What exactly is FIRE and how does it work?

FIRE (Financial Independence, Retire Early) is a movement focused on aggressive saving and investing to achieve financial independence decades before traditional retirement age. Typically involves saving 50-70% of income and living frugally to build an investment portfolio that covers living expenses.

How much money do I need to achieve FIRE?

The common rule is 25x your annual expenses, based on the 4% safe withdrawal rate. If you spend £30,000 annually, you'd need £750,000 invested. Some variants use 3.5% or 3% for more safety, requiring 28-33x expenses.

What are the different types of FIRE?

Lean FIRE (minimal lifestyle, ~£25k/year), Fat FIRE (luxury lifestyle, £100k+/year), Barista FIRE (part-time work for benefits), Coast FIRE (invest early, let compound), and Geo FIRE (move to low-cost areas). Choose based on your lifestyle goals and risk tolerance.

Is FIRE realistic for someone with an average income?

Challenging but possible with strategies: house hacking, side hustles, career advancement, geographic arbitrage, and extreme frugality. Many achieve FIRE on £30-50k incomes through high savings rates (50%+) and smart investing. It may take longer but remains achievable.

What are the biggest risks and downsides of FIRE?

Market risk (bad timing), inflation risk, healthcare costs, longevity risk (outliving money), lifestyle inflation, and potential regret. Also requires significant sacrifice and may impact social relationships. Many recommend building in safety margins and flexibility.

How does FIRE work with UK-specific considerations?

UK considerations: State pension age, NHS healthcare, ISA allowances (£20k/year), pension tax relief, and higher living costs. Many UK FIRE followers use ISAs for tax efficiency and factor in the State Pension as a safety net in later years.

What if I change my mind about early retirement?

FIRE provides flexibility - you can work part-time, change careers, start a business, or take sabbaticals without financial pressure. The goal is freedom, not necessarily stopping work entirely. Many 'retire' then find fulfilling work they enjoy.

Your Guide to Financial Freedom

Discover how the FIRE movement can transform your relationship with money and help you build the future you deserve.

What is FIRE?

FIRE stands for Financial Independence, Retire Early, a powerful movement focused on intentional living and financial empowerment.

At its core, FIRE is about reaching the point where your investment income covers your living expenses, giving you the freedom to choose how you spend your time. It’s not about escaping work, but about having the power to design your own life, whether that includes work or not.

The Core FIRE Formula

When your annual investment income ≥ annual living expenses = Financial Freedom

Find Your FIRE: A Spectrum of Lifestyles

FIRE isn't one-size-fits-all. It’s a flexible framework. Find the path that aligns with your ideal future.

LeanFIRE

For the minimalist. You live on a lean budget, allowing you to achieve financial independence with a smaller nest egg. The focus is on efficiency and valuing experiences over possessions.

FatFIRE

For a luxurious retirement. You aim for a large portfolio that generates a substantial income, affording a high-end lifestyle without financial constraints during retirement.

BaristaFIRE

The semi-retirement option. You have enough saved to cover most expenses but work a part-time job you enjoy, often for benefits like health insurance. It's a bridge to full retirement.

CoastFIRE

The "let it grow" approach. You invest enough early on that your portfolio will grow to a full retirement fund by age 65 without adding another penny. You just work to cover current living costs, removing the pressure to save.

The 4 Pillars of Your FIRE Journey

Define Your Freedom Number

Based on the "4% Rule" from academic research, a common starting point is to multiply your desired annual retirement income by 25. This gives you a target investment goal. Use Delphina's tools to track expenses and refine this number.

Calculate your retirement number

Maximise Your Savings Rate

Most FIRE pursuers aim to save 30-70% of their income. This is achieved by boosting your income and optimising your "big three" expenses: housing, transportation, and food. Every pound saved accelerates your journey.

Optimise your budget

Invest for Growth

Build a diversified portfolio, typically focused on low-cost, broad-market index funds and ETFs. This strategy minimises costs and harnesses the power of compound growth. Delphina helps you monitor your asset allocation and stay on track.

Start investing

Track and Optimise

Regularly monitor your net worth, savings rate, and investment performance. Seeing your progress is a powerful motivator. Delphina's dashboard simplifies this, helping you stay on course and celebrate milestones.

Track net worth

Your FIRE Questions, Answered

Is FIRE only for high earners?

Not at all. While a high income accelerates the journey, FIRE is fundamentally about your savings rate, not just your salary. A person earning £40k and saving 50% is on a faster track than someone earning £100k and saving only 10%.

How do you handle a market crash?

A robust FIRE plan anticipates volatility. Key strategies include using a more conservative withdrawal rate (e.g., 3.5%), maintaining a cash buffer (1-2 years of expenses), and having a flexible budget to reduce spending during downturns.

What if I don't want to "retire" in the traditional sense?

That's the beauty of it! Financial Independence gives you options. Many use it to "recreate" their careers, starting businesses, pursuing creative passions, or working on projects they love without worrying about the paycheck.

Illustrative FIRE Journeys

Consider Emma (LeanFIRE)

Emma, 32 years old, reached her Lean FIRE goal by consistently saving 65% of her income. She focused on intentional spending and invested in low-cost index funds. Now, she has the freedom to run her own small business and travel the world.

Consider James (CoastFIRE)

James, 45 years old, hit his Coast FIRE number at 40. With his retirement portfolio growing in the background, he transitioned to a less demanding job he loves, covering his daily expenses without the stress of needing to save for the future.

How Delphina Ignites Your FIRE Journey

Gain Financial Foresight

See how your choices affect your FIRE timeline with our advanced projections.

Build a Unified View

Track net worth, budgets, and investments in one place for holistic FIRE planning.

Create Personalised Scenarios

Model different FIRE paths and get recommendations that adapt to your unique timeline.

🇬🇧 UK FIRE Resources & Tools

Build your UK-specific FIRE strategy with these tailored resources: