FIRE vs FIAR – Which One Makes Sense for You?

The FIRE Movement

The FIRE movement, which stands for Financial Independence Retire Early, is a lifestyle choice among working professionals to save a huge chunk of their income with the intent of retiring in their 30s or 40s. If you’ve spent much time in the personal finance space online, you’ve probably heard of it.

Ambitious earners aim to live ultra frugally, save as much as 75% of their incomes, and generally invest in low-cost stock index funds in order to reach financial independence within a short time period. Time frames for retiring early can be anywhere from 5 to 20 years, but typically fall within the 10-15 year range.

One of the benefits of FIRE is that once you retire, you retire forever. In order to retire, you save up enough cash that you can live off of 4% of your investments per year. For instance, if you saved a million dollars, you would withdraw $40,000 per year to live off of.

The FIRE movement has a dedicated subreddit community and has become very popular on the web, if you want to learn more.

So what’s FIAR?

FIAR is an acronym I created that stands for Financial Independence / Abbreviated Retirement. The concept of FIAR is that instead of saving up to retire forever, you save up to retire for a short period of time – 6 months up to 2 years. During your time off, you fulfill a lifelong dream or goal.

Your dream could be to hike Mt. Everest, or circumnavigate the globe in a sailboat. Your dream could be to relocate to China to teach Chinese children English, or go on a mission trip to help starving villages in Africa. Maybe there’s a career you’ve never tried because you couldn’t afford to start over.

Whatever your dream is, you take a year or two off from your day job and insert yourself fully into that dream or mission.

After your abbreviated (shortened) retirement period is over, you can re-enter corporate life, or pivot to something new. You get to decide. Flexibility is one of the greatest attributes of FIAR.

Tim Ferris, author of the Four Hour Work Week, has talked extensively about taking mini retirements throughout your life. FIAR is a similar concept, but focuses more on planning and saving for a single, life-changing, short retirement that allows you to try something new or experience a life-changing adventure.

My husband and I are focusing on FIAR instead of FIRE. We want to sail around the world, and we don’t want to wait until we’re old to do it. We’d like to spend 1-2 years out on the water, and then decide after if we return, or continue on.

We will focus on spending time with our young children, experiencing foreign cultures, and working on creative projects (like possibly a Youtube vlog) while we are traveling. The challenge of learning how to sail, saving up enough money to go, and crossing an ocean is very exciting to us.

Benefits of FIAR

There’s benefits to both mindsets and goals, but here are some specific differences that make FIAR more appealing to  us:

  • Faster – With FIAR, our savings doesn’t have to cover our cost-of-living for the rest of our lives. It only has to last as long as we decide to be retired. Instead of saving for 10-15 years, we only need to save for 2-5. Instead of needing $1.5M dollars or more for FIRE, we only need around $350k for FIAR.
  • Easier to Stay Motivated – Because its a shorter time-frame, and because we are saving up for a crazy, awesome adventure, it is easy to stay motivated.
  • Specific Adventure or Experience – The cool thing about FIAR is how you’re saving for a specific, major bucket-list experience. FIAR doesn’t work well for the person who wants to quit their job and do nothing for a year or two. Why? Because that would be difficult to explain to a hiring company when re-entering the workforce. Think about it. Your potential new boss asks you, “So why did you take two years off of work?”
    • Answer A – “I had a dream of circumnavigating the globe, and wanted to accomplish that before I start experiencing health issues.”
    • Answer B – “I was tired of corporate life and wanted to just chill for a few years.”
  • Try Before You Buy – With the concept of FIAR, we get to try out a new lifestyle without committing to it forever. We may decide we don’t like it, or don’t want to stay with it as long as intended. We may love it so much we go full FIRE when our initial mini-retirement ends. Having the mindset that we don’t need all the answers today really helps keep me motivated.
  • New Outlook – Taking extended time off from our jobs gives us an opportunity for a new or refreshed outlook on life. We may not even return to our old jobs – we may have encounters or experiences that lead us in an entirely different direction. Who knows!

5 Travel-Centric Ideas for a Mini Retirement


FIRE vs FIAR Infographic

Both FIRE and FIAR offer solutions for those seeking financial freedom. Both mindsets require discipline and planning to pull off. Retire forever when you’re 35, or take a couple of years off and then re-assess?

In my view, FIAR provides more flexibility, and can be achieved faster. However, it won’t last forever.

It all comes down to what your goals are. I think back to the movie “Office Space” and a conversation between the protagonist and his friend. Here’s an abbreviated version of the conversation:

Friend: “What would you do if you had a million dollars?”

Protagonist: “Nothing. I would sit on my ass all day. I would do nothing.”

Friend: “Well you don’t need a million dollars to do nothing.”

The benefit of FIRE is that you are set for life. You can do absolutely nothing until you die, if you want. If you save up enough money, you might even be able to afford to do something.

Choose the one that makes the most sense to you and your family, and then go all in.

Are you saving for FIRE or FIAR? Share in the comments below!


FIRE vs FIAR - Which One Makes Sense for You?


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