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EP: 009 F.I.R.E: Charting a Healthy Course Toward Financial Independence w/ Allen Mueller

F.I.R.E. How much money do you need to be truly Financially Independent? And how to get there there the right way.

EP: 009 F.I.R.E: Charting a Healthy Course Toward Financial Independence w/ Allen Mueller
F.I.R.E : Charting a Healthy Course Towards Financial Independence w/ Allen Mueller and Host Jim Grace

In this episode I talk with Financial Planner Allen Mueller about F.I.R.E, Financial Independence Retire Early.  What it is and isn't, how to go about seeking financial independence and things to consider if you plan to retire early.

I've been really intrigued about F.I.R.E for a while now. The "movement", if you can call it that, has been around for a long time but really gained steam around the same time COVID was unfolding across the globe.

However the concept of seeking Financial Independence seemed to have gotten highjacked by a lot of people who simply wanted to quit their jobs.

As you'll hear in the episode, Financial Independence is simply having enough money that you don't require earned income to maintain your lifestyle. That's a goal all of us should be working towards and it's something we advise clients on all the time.

However the "F.I.R.E" movement can sometimes feel a little aggressive with some members of the "community" saving and investing as much as 60% or more of their income so that they can quit their jobs as soon as possible. During the time that seemed to align with the height of COVID lockdowns, there was a blurring of lines between sound strategies aimed at obtaining financial independence and significant risk taking, betting on meme stocks and things like NFT's.

Allen helps us sort through the healthy vs. unhealthy approaches when embarking on your own financial independence journey. It doesn't have to be an all or nothing concept.

Just because you want to scale back your lifestyle and focus on what's truly important doesn't mean you have to live in a tiny house in the woods and only eat Ramen noodles.

As you'll hear in the conversation, simply being "Financially Independent (FI) Enough" can be a really empowering target to shoot for. "FI Enough" means you have enough money saved that you don't have to keep your current job that you might hate. You might not be ready for retirement though either. You can take a pay-cut and go follow a passion and still make it to and through a healthy retirement.

Again, doing the things we want to be doing and having the financial independence to do so is something we should all be working towards.

So if you are like me and were a little put off by the whole "F.I.R.E Movement" and the noise that has surrounded it recently, but still value the concept of Financial Independence I hope you'll check out the conversation.

I think you'll come away with a new found appreciation for Financial Independence and the importance of understanding what's truly meaningful to you.

YOU WILL LEARN ABOUT:

  • F.I.R.E - What it is and isn't.
  • Allen’s journey from engineer in a cubicle to being an independent financial advisor on his own path toward financial independence.  All of which was driven by a “Desire for a control of my time”.
  • Retiring "Away" from something vs. Retiring "To" something else.
  • Having the ability to live your lifestyle without earned income.
  • Saving and investing enough to retire “earlier” than normal.
  • Calculating your FI # (Financial Independence #) = Household spending x 25. 
  • Coast FIRE  & Being FI Enough > Taking a pay cut to follow a passion.
  • If I didn’t need the paycheck, would I still be doing this?
  • Tips to Follow When Seeking Financial Independence:
    • Being as efficient as possible
    • Fees need to be low
    • Taxes need to be optimized 
    • Picking the right types of accounts
    • Proper planning for the "what if’s" of life 
  • An alternative to "Budgeting" = "A Conscious Spending Plan".

TOOLS:

  • FireCalc - Online calculators to help you understand your FI # and how to get there.
  • Monarch Money - Financial Dashboard, Budgeting App & Planning Tool to help you get organized and manage your finances.

READ + LISTEN + LEARN:

WELLBEING: 

  • Allen explains his thoughts on overall wellbeing telling us that, “Heath is wealth.  What’s the point of being retired early if you can’t enjoy it".  Therefore Allen likes to stay fit and focused on eating a healthy diet. 

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