How you could achieve a ‘comfortable retirement’ using the FIRE movement

Expert reveals tips on how to save for retirement

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The idea of retiring early is attractive to many people who may be tired with work, looking for a new challenge, or simply more of their own time. However, what is the key to a comfortable retirement? While some say finances, there may be other issues at play. To find out more, spoke exclusively to James Norton, Head of Financial Planners at Vanguard UK.

He discussed the FIRE movement, its growing popularity, and what Britons need to do if they want to meet the goal.

Mr Norton explained: “There aren’t hard and fast rules about FIRE, and it does come down to individuals. But the earlier you start, the more advantageous it is likely to be.

“People in their 20s have more time, but people in their 30s are probably earning a bit more.

“If that person in their 30s has adjusted their lifestyle, then they are in a really strong position. This is the case even for people in their 40s.

“But it does come down to the spend/save mentality and where the person rests on that.

“Investing and saving is about sacrificing in the short-term for a long-term enjoyment.”

Mr Norton highlighted the idea of deferring “happiness” now to enjoy life later down the line.

This is a principle often considered central to the FIRE movement, but it does come under some criticism.

The expert did not reject the notion, and instead appeared to suggest a compromise on the matter. 

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He added: “I think people need to get the balance right when it comes to what they want and what they need.

“With that being said, it is important to enjoy yourself now, as you don’t know what is going to happen tomorrow.”

The FIRE movement first started in 1992 in America, and many people both in the US and UK follow it diligently.

However, there are individuals who may be applying its principles to their lives perhaps without even realising it.

Mr Norton acknowledged this, and said: “Not a lot of people have made a conscious decision to step on the FIRE bandwagon, but they could be working towards it anyway.

“Let’s be honest, a lot of people are on the bandwagon. We’re caught up by what we’re doing, saving for a house, or a bigger car or a better holiday.”

However, for Mr Norton, money is not the only important part of the FIRE movement.

Instead, he says individuals should also consider the matter of present happiness with their lives.

He added: “Helping people who have said enough is enough, and they are happy with where they are is really powerful.

“Some people are willing to accept a slightly lower material standard of living to make them materially happier.

“Individuals have more time to enjoy themselves, they don’t get burnt out, and they have reached that comfortable retirement they are hoping for.”

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Mr Norton stressed the idea of flexibility in FIRE ambitions as being central to the idea of retiring early. 

He said there are no hard and fast rules for Britons to work to, and changing according to circumstances is likely to be key.

This could be a matter of re-thinking the age at which one is set to retire, or having a flexible strategy when it comes to retirement spending. 

Mr Norton concluded: “There’s plenty of research out there which looks at how much money you really need to be happy. Actually, it isn’t as much as most of us will think or be hoping to achieve.

“No one on their death bed talks about wanting more material things.

“People want to spend more time with friends or family, or follow their passions or pursuits, giving back or becoming more spiritual.

“Bags of money are not at the core of happiness, and more and more people are realising this.”

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