Much More With Less
Moving to the country, living on less and making the most of it.

FIRE and sustainability

Picture of my husband and son out for a walk in the woods

The best things in life aren’t things at all

 

One of the big attractions for me of the financial independence, retire early (FIRE) movement is that it encourages a more sustainable lifestyle.

That’s why I was excited to be asked to take part in Radio 4’s Money Box Live at 3pm today, all about FIRE (listen here). Yup, that’s me, introduced as ‘caller Faith’ ๐Ÿ˜‰

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Pinterest size image of a green woodland walk for my post on FIRE and sustainability

What is FIRE?

Have you come across FIRE before? It’s been hitting the headlines in recent years, with extreme examples of people who save 70% of their income so they can retire in their 30s. 

Fundamentally, FIRE is all about creating a gap between the money coming in and the money going out, then investing the difference.

Devotees aim to build a big enough balance so that they can live off the income, without ever needing to work again. As a rule of thumb, that means saving up 25 times your annual living expenses, so you can withdraw 4% a year, rising with inflation, without running out of money. So if for example you need £20,000 a year, you’ll have to stash away at least £500,000.

Given many people don’t even have £100 in savings, that’s a mountain of money. 

My article about FIRE for The Sunday Times

Picture of a rice with leftovers for lunch for my post about FIRE and sustainability

Reducing food waste

FIRE and sustainability

Pursuing FIRE doesn’t only have financial advantages, but also environmental benefits.

Saving money for early retirement isn’t about ‘Wow – I’ve saved 50% on this handbag’. It’s about saying ‘You know what, I don’t actually need another handbag’.

I buy less, and what I do buy, I want to last for as long as possible. I get a lot of stuff second hand, then try to repair and reuse what I already have, so I throw less away. I’m always looking to reduce our food waste, to include more plant-based meals, to walk rather than take the car, to cut our energy bills.

All these small changes add up. Yes, they save money. But it also means we’re consuming less of the world’s resources, using fewer fossil fuels, putting less into landfill and creating less environmental damage.

Previous posts on Plastic Free July food, household products and ethical investing

Rejecting the pressure to consume

Pursuing financial independence makes you question why you buy and resist pressure to consume. It’s choosing not to be defined by your possessions, but perhaps by the lack of them.

I don’t need to spend my entire income, and more, pursuing fancy designer clothes, cars, holidays and other status symbols. Sure, I might need some of those things, but I aim to get them for less, and use less of them.

Every single day, we are surrounded by marketing and advertising, encouraging us to buy, buy, buy. How many ads to you see saying ‘spend less and save more‘? As the quote runs, don’t be pushed into buying things you don’t need, with money you don’t have, to impress people you don’t even like.

Getting outdoors is far better for health and wealth than being stuck inside a shopping centre, or sitting behind a screen, shopping online. As you can tell from my Instagram posts, I quite literally prefer taking time to smell the roses.

Previous posts: 30 tips to stop shopping  and How to stop impulse shopping

Picture of a couple of colourful cocktails for my post about FIRE and sustainability

More cocktails, less retirement

More financial independence, less retire early

To me, financial independence isn’t about retiring completely, to sit on a beach sipping margaritas.

The important part is financial independence – rather than hoarding enough money to quit work. I’d never suggest anyone stays trapped in a job they hate, just to raise some magical FIRE amount of money. But building financial independence can give you the freedom to quit and find more rewarding work.

What financial independence really brings is freedom from money worries and crushing debt. Money can’t buy happiness, but lack of it can be incredibly destructive. 

Financial independence also brings choice – the choice to quit a job that isn’t working for you, leave a relationship that’s wrong, or move to a different home. Cushioned by savings, and with lower living costs, it’s possible to achieve a much better work / life balance.

As a family, we lucked out on house prices. By moving from London to the country, we cleared our mortgage completely, so our living costs are lower. It gave us the financial freedom so that my husband could return to working for the charity sector and I could continue working freelance from home, part time around school hours.

I enjoy writing about money – I don’t actually want to quit! But I certainly wouldn’t want to return to my first job, with all the stress, crazy hours and longer commuting. As a family, we made a choice to prioritise time together, rather than money.

I’ve seen frugal living criticised as time consuming and less convenient. But because we made the move, and cut our hours, we have the time to walk or cycle, to cook from scratch, to spend time with the kids rather than forking out for expensive presents and outings out of guilt.

Financial independence as a spectrum

As I said earlier, it’s the extreme examples of FIRE that hit the headlines. 

Let’s be clear right now. Anyone who is scraping by on a minimum wage, zero hours contract, barely covering the essentials, isn’t going to be able to retire in their 30s just by saving 10p on each pint of milk.

Saving is only possible if you have some disposable income, after covering your essential bills.

However, I get frustrated when people dismiss FIRE based on insane examples of extreme frugality and immense income. FIRE is just a bunch of individuals making their own decisions about money, it’s not got compulsory rules you’re forced to follow!

Instead, look at how powerful stashing some cash can be, even if you never hit the mountain required for early retirement.

Clearing debt is a major step along the road to financial independence. Creating an emergency fund removes money worries if your boiler blows up, washing machine breaks down or car grinds to a halt – and sod’s law states that all three will happen at once.

I envy the lucky few who can go through life without suffering a relationship breakdown, job loss, illness or time out caring for someone. Savings can help stop major life events becoming a financial crisis. Buying a home, and then clearing the mortgage, means no-one can remove the roof over your head.

Previous post: What does it feel like to be mortgage free?

Early retirement or any retirement?

For most of us, saving more isn’t about hitting early retirement. It brings the possibility of retiring at all. The state pension is low, state pension age is getting ever older, and state pension payments are never going to increase in real terms, as with an ageing population, the costs are just too expensive. In today’s brave new world, with vanishing final salary pensions, most of us are responsible for our own retirement income.

Previous post: What is a pension and why you should care

However, by increasing what we save, we can retire earlier. Maybe not in our 30s or 40s, but still earlier. 
Check out this post by FIRE cult hero Mr Money Mustache, about the shockingly simple maths of early retirement. If you can increase your savings rate from 10% to 15% of your take home pay, you can cut your time to retirement by 8 years. I remember watching the London premier of the film Playing with FIRE, organised by FIRE bloggers Barney and Ken, when The Mad Fientist pointed out that just by cutting one car payment, the couple could retire 5 years earlier.

 

Now over to you – what do you think about FIRE and sustainability? Can you see environmental benefits from frugality? Or do you just view FIRE as utterly unrealistic? Do share in the comments, I’d love to hear!

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112 Comments

  1. Liz
    6th November 2019 / 9:52 pm

    ‘Fire’ was my entry point into personal finance. I had always been well paid, so didn’t have credit card debt, but didn’t really think to save. A few hiccups, illness and a changing family situation, made me realise how precarious my finances were.
    I started with an article in the Guardian about the Frugalwoods but it was Cait Flanders (The Year of Less) and Vicki Robin (Your Money or Your Life) that made me see how changing my relationship and approach to money would result in less anxiety, more security and a better sense of myself and what is ‘enough’.
    I have been able to save up enough in a couple of years to build an emergency fund and change jobs (getting paid ยฃ20k less) to do something with much more satisfaction. And as woman I now feel more confident about providing for my own future which gives me the freedom to avoid toxic relationships.

    Reply
    • Faith
      Author
      10th November 2019 / 7:46 am

      Hi Liz – Can’t tell you how delighted I was to read your comment. So brilliant that reading about FIRE inspired you to change your approach to money, so you can pursue more rewarding jobs and relationships. Share your enthusiasm for the Frugalwoods, Cait Flanders and Vicki Robin – I wrote a review of ‘The Year of Less’ here: https://www.muchmorewithless.co.uk/review-the-year-of-less/

      Reply
  2. Jacky
    11th November 2019 / 9:45 pm

    FIRE was also my entry point into personal finance. I had always earned good money and tracked our spending but struggled to stay out of debt, largely due to lifestyle inflation. Redundancy in 2012 allowed me to clear this debt and I was determined never to go back there. We stayed in London but downsized the house, cleared the mortgage and helped our daughter with a flat deposit. A couple of years later when an old endowment policy paid out we helped our son buy a flat. In 2016 I discovered FIRE through a mention about MMM on another website. The shockingly simple maths post was an epiphany. Four years later having built up a substantial savings cushion I will shortly be handing in my notice and at 58 won’t ever have to work again, but of course can if I want to. I try to drum the principles into any one who cares to listen! Especially my children!

    Reply
    • Faith
      Author
      12th November 2019 / 4:52 pm

      Thanks so much for sharing your story. Delighted redundancy helped put you on a new path and many congrats on being able to hand in your notice at 58! I also find that particular MMM post very powerful, and try to link to it whenever possible. Finding FIRE really can be life changing, and as I keep shouting at some media coverage, doesn’t only apply to those in their 30s.

      Reply
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