Early retirement wisdom from 50+ top finance writers

Early retirement is becoming more popular, seemingly by the day

If you read much personal finance content, you know that early retirement is an increasingly popular topic these days.

Reddit has a financial independence subreddit with over 450,000 subscribers, has been burning up with posts and comments about early retirement lately.

The retirement blog genre has mostly given way to the early retirement blog, and books like Early Retirement Extreme and Your Money or Your Life are flying off the shelf.

The FIRE Movement Heats Up

The Financial Independence, Retire Early (FIRE) movement is burning up on the internet, with hundreds of blogs focused on the subject, and with a rapidly increasing amount of discussion in mainstream media.

According to J Money at Budgets Are Sexy, there are even four types of FIRE now.

While being able to retire at 55 might have seemed early as recently as a decade ago, the recent bull market has buoyed the hopes of many people to be able to achieve financial independence much earlier.

Dramatic stories of people saving and investing significant amounts of money and walking away from full-time work in their 40s, 30s, or even 20s, are almost becoming commonplace.

But there’s a lot of uncertainty out there as to whether even a few million dollars will be enough for an individual or a family to pay their bills for the many decades that could follow such an early retirement.

The FIRE Extinguisher?

Earlier this fall, Suze Orman released a cloud of proverbial carbon dioxide on the FIRE movement by opining on Paula Pant’s Afford Anything Podcast that, “You need at least $5 million, or $6 million…You might need $10 million,” to retire early.

FIRE enthusiasts were hot under the collar when Ms. Orman remarked, “You will get burned if you play with FIRE.”

The reality, though, is that, despite those types of concerns, early retirement is becoming an increasingly common goal.

50+ Top Finance Writers (and a few FIRE Enthusiasts) Share Their Wisdom

Terms like early retirement and financial independence are familiar to many of us.

But personal finance is, well, personal, and the meanings can vary based on our circumstances.

So, we reached out to over 50 top finance writers and some prominent FIRE enthusiasts, and gave them a 10 question survey titled, “What does FIRE (Financial Independence, Retire Early) mean to you?”

This survey was an excellent opportunity to learn more about how the personal finance community views financial independence and early retirement, and we hope you enjoy seeing the results.

Financial Independence Defined

How would you define financial independence?

Is it able to pay all your bills indefinitely?  Does it include not having to work? In a family finance scenario, how do the numbers differ when compared to a single person?

Here are the answers from some of the over 50 top finance writers and FIRE enthusiasts we polled.

“Financial Independence” is:

Passive income > future expenses.” – Wealthy by 40

“Ability to experience enjoyment for me, family & friends.” – Millennial Boss

“Having enough money put aside that I do not need to work to earn money.” – Back On The Road Again

“The ability to not have to work to live and the freedom from financial stress.” – Fetching Financial Freedom

“Financial independence is being able to cover all of your expenses with passive income, whether from investing or other income projects. It is important to note that to have true financial independence. You don’t alter your lifestyle to the extremes.” – Wealthy Wishing

“Having enough financial wealth to live life on my terms without the need to spend my time actively earning money.” – Life Zemplified

“Having enough money not to have to work at a job if I don’t want to. Which for me, means not working rather than continuing to work.” Tuppenny’s Fireplace

“I’ll know I’m financially independent when I no longer have to work for “the man” because I’ll have reached my savings goals.” – Baby Boomer Super Saver

“Not being dependent on a normal income (i.e., a job) to live.” Joe’s GitHub Blog

“When work becomes optional.” – Ms. Liz Money Matters

“You have enough money that you can quit working and be financially fine for the rest of your life.” – Slow Sipping Coffee

“Working for money is optional, not required.” – Am I Making Cents

“The ability to live life on my terms and make decisions without being forced to compromise on the quality of life for financial gain.” – Your Money Blueprint

“Building up enough wealth to control your own life. You’re no longer tied to a job or specific locale and can live as you choose.” – Smile and Conquer

Financial Independence By The Numbers

Even with all the definitions of financial independence we received, its meaning still seemed a little subjective to us.

So we also asked our survey participants a few quantitative questions that may paint a more concrete picture of what it means to them to be financially independent.

How Big Is Your Household?

First, we asked respondents how many people are in their immediate household. Here’s the chart capturing their responses:

People in Household chart
The Money Mix

We were surprised by a few of the numbers:

  • Almost 55% of the families in our survey had three or more people,
  • Nearly 40% lived with one other person,
  • Less than 8% of respondents were single, and
  • Less than 8% of respondents had households with five or more people.

How Much Money To Reach Financial Independence

Second, we asked respondents what would be the minimum amount of money necessary for them to become financially independence.

Minimum Money chart
The Money Mix

Here are some of the statistics we found interesting:

  • Over 7% believe less than $250,000 is necessary to reach financial independence,
  • Over 45% believe less than $1 million is essential,
  • Over 36% believe somewhere between $1 million and $2 million will be enough,
  • Less than 20% feel more than $2 million will be necessary, and
  • Less than 11% feel more than $3 million will be required.

How Long To Achieve Financial Independence

With books like Early Retirement Extreme setting the bar high, and we were curious how long our respondents thought it might take them to achieve financial independence for themselves and/or their households.

Minimum Time chart
The Money Mix

Here are some of the numbers we thought were worth sharing:

  • Over 14% already identified as financially independent,
  • Another 41% believed they would reach their financial independence number within five years,
  • Another almost 22% thought they’d reach their number with ten years, and
  • Less than 23% thought it would take more than ten years to achieve financial independence.

Early Retirement Defined

Early retirement can be as subjective of a term as financial independence.

How would you define early retirement?

Is there a certain age attached to retiring early? If you retire at 55, did you retire early? Can you work during retirement and still be considered to be retired? How much?

Here are the answers from some of the over 50 top finance writers and FIRE enthusiasts we polled.

“Early Retirement” is…

“Leaving consistent employment before the traditional retirement age.” – Femme Cents

“Not being dependent on your primary job- having the ability to chose to work or not to work. Having the freedom to choose what to do with your time.” – Passive Income NZ

“When you struggle to find people your age to hang out with during the day time.” – 5 AM Joel

“Ability to walk away from W2 earnings to pursue personal interests without fear of meeting expense responsibilities.” – HackToFI

“Not NEEDING to work 40 hours a week for someone else to meet our needs. It’s the ability to work on what we WANT to work on.” – Heartland on FIRE

“Early retirement for me was quitting the 9 to 5 and no longer needing to work for a living.” – Freedom Is Groovy

“I don’t believe in retirement anymore. If I have an income-producing method I enjoy, I’ll work until I’m in my grave.” – Life Reboot Project

“Quitting your career to pursue other interests in life without worrying about a paycheck.” – Caught on FIRE

“Less than twenty hours a week of active work.” – Stop Ironing Shirts

“Trading in the 9-5 type job you “have” to work at for something you honestly “want” to do.” – Mr. and Mrs. Money Magnet

“Retiring before age 50.” – Debt Free Odyssey

“Ability to step away from full-time work and not worry about ever working again. but if you want to work on a passion project, that’s fine too.” – Josh Overmyer

“Doing what you love.” – AMV70R

“I think people get too hung up on defining retirement. Once we reach financial independence, we will choose to work and/or not work based solely on desire.” – Living Life Loving Us

Working During Early Retirement

There was a lot of variation in the answers we received about what it means to retire early.

So, we asked respondents whether they thought a person could work during retirement without losing the meaning.

Work in Retirement chart
The Money Mix

Almost 95% felt a person could keep working during early retirement and still be considered to be retired.

Less than 5% thought otherwise.

How Much Work Can An Early Retiree Do?

Since we asked the question, it’s fortunate that so many of our respondents believe a person can do at least some work during early retirement.

Here’s the question we asked:

How much work do you think a person can do during early retirement and still be considered to be retired? Is it a specific time or dollar amount or something different?

Here are some of the answers we received:

“Anything that makes you happy and does not feel like work. Doing what you love doesn’t feel like work.” – Saving Joyfully

“For me, I would still consider someone early retired if doing a passion activity that can bring with it some income. I would limit the upper amount of hours to 16 hours a week.” – Xrayvsn

“I don’t know that it can be defined by the amount of time or a dollar amount. If their investments generate enough income for them to live on, then anything else they want to make on the side would be like bonus income.” – Mostly Always Right

“It’s whatever the person wants. The point is they get to choose what they do with their time.” – Every Day By The Lake

“That’s a tough question. Going by my definition, I think you can still earn and spend time working while you are ‘retired.’ The problem is that the word retirement brings to mind no work, all play, living off of your investments (typically at an older age). If you are young and you can live off of your investment income, but you choose to work; still, I might consider that retirement because you no longer work out of necessity. Maybe there needs to be a new term.” – Capital Matters

“It’s not the time that is worked but rather how the time is spent. It’s a mindset.” – MikedUp Blog

“In my mind, it’s time, but there are also stages of retirement. Stage 1 is no longer needing W2 income to fund your lifestyle comfortably; Stage 2 is never having to work again. Working 8-10 hours per week during Stage 1 FIRE feels like a good balance of working as little as possible without going crazy from boredom.” – The Incredible Cash Dummy

“10-15 hours a week.” – Dr. Linus at Dads Making Cents

“I think as long as the work is a choice and not a need, it’s still retirement.” – Ms. Fiology

“I think a person can most certainly work when they retire early. There is a big difference between working to pay the bills and working so that you can afford the extra luxuries life has to offer (travel, dining out). It would have to be work that either passive, a hobby, or something that does NOT have to be done to afford being retired.” – Lucky Mojito

“I don’t think there’s a set time or dollar amount; it’s work that you don’t have to do. You do it because you enjoy it.” – Frugal Husband

“I think if you are still actively working for income, then you are not fully retired.” – Money Saved Is Money Earned

“If they don’t need the money and have declared themselves retired I don’t think there’s a time or dollar amount that makes someone ‘unretired.’” – A Purple Life

“It is as much about the terms of that work as the hours, is it up to you how many hours you work, who is in control?” – Back On The Road Again

“Less about money and time, it’s more about doing what you love. Isn’t there a saying, if you love your work then it doesn’t feel like work.” – We Saved Together

“As long as what they are doing to make money doesn’t interfere with what they are doing for their quality of life. Retirement is not feeling like you HAVE to do something to survive anymore. You could also call it freedom.” – Netta Marie Woods

“As much as they like as long as it is their choice and not a necessity.” – Looking After Your Pennies

The Maximum Age For Early Retirement

Finally, we thought it would be interesting to see what age people thought would be the maximum for early retirement.

If a person were to retire at 55, would that be early? What about 60?

Here’s a chart capturing what our respondents had to say:

Early Retire Age chart
The Money Mix

Here are some of the numbers we thought were interesting:

  • No one thought a person needed to be under 40 to retire early,
  • Less than 31% thought a person needed to be under 50 to achieve early retirement,
  • Over 52% thought a person required to retire at 55 or younger to be an early retiree, and
  • Over 87% thought a person would have to retire before 60 to be considered early retirement.

Closing Thoughts

After surveying over 50 of the top finance blog, retirement blog, early retirement blog, personal finance blog writers of the best personal finance blogs, money blogs, and money savings blogs, we learned one thing…

If you asked us how to define terms like “financial independence” or “early retirement,” we’d give you the same answer:

“It depends!”

The definitions of financial independence and early retirement depend on things like who you’re talking with, what their family situation is, where they live, and what their goals are.

It’s hard to say what the next 5-10 years will bring for the FIRE movement.

Will a recession stop some FIRE walkers in their tracks?

Could a contagious FIRE cause a recession? We think that only time will tell…

What do you think?

This article first appeared on The Money Mix.