this post was submitted on 17 Jul 2023
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FIRE (Financial Independence Retire Early)
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I’ll guess I’ll kick off this week’s discussion thread with some questions. Where does everyone see themselves on the FI spectrum from lean to fat? Assuming you’re focused on early retirement, what are you optimizing for in retirement?
I’m in the chubby camp. I want to have a big enough pile to have options. In some of the other communities I’ve been in I’ve heard it phrased as having enough money to do almost anything, but not everything and that resonates with me.
My main goal is to have enough money that we can do some fun stuff, help out the kids if needed, and just not need to worry or think too much about money otherwise.
While my kids live at home, regular fire due to living in HCOL. Once they are off to college, I'd love to move somewhere cheaper and live a lean fire life. In other words, I should hit my number once they leave home.
It's an interesting question, because the spectrum of lean to fat seems to have shifted a lot in the last half decade. What used to be in the middle now seems to be perceived as lean, and what used to be lean now seems to be perceived as unthinkable. This is going purely off sentiment in the other place, but I see lots of "I have $5m, can I retire?" posts, which feels like the very definition of a redundant question to me.
So a few years ago, I would say our ambitions of retiring on our current spending (which we've kept under control) would have been mid-tier. Now, it would very much be seen as lean.
I think the definitions are subjective and can be contentious. People seem to love debating the one true list of dollar amounts for each level, which then invariably spirals into a cost of living, size of household, and inflation debate.
I was trying to side step that by just asking where people see themselves and not the underlying numbers. I think what you’re aiming for, regardless of whether we’re using exactly the same definitions, conveys a lot about your risk appetite, desire for luxuries, etc.
You mention your expenses would now be seen as lean — do you actually agree with that or is it more your impression of community sentiment?
Community sentiment, definitely. I'm quite comfortable that our numbers have been reached from years of measuring how much we spend, so how much we'll need.
I'd say I'm looking for an average fire or slightly leaning towards chubby. I basically have enough to lean fire right now, but I'd have no extra money for hobbies or other luxuries. I'm basically planning on doubling my savings to afford my expensive hobby, travel, and other occasional luxuries once I pull the plug.
Are you thinking in terms of fixed and flexible spending and eyeing something like VPW to budget the flexible spending or are you thinking more in terms of a fixed withdrawal rate that’d cover your expected fun budget too?
I mostly just plan in terms of a fixed rate that should cover all of my spending. While I expect in retirement I will probably see more of a variable withdrawal rate, I haven't worked that level of calculations into my plan. That probably won't be a consideration for me until I'm actually at my number and starting to calculate out if I'm comfortable retiring at it or not.
I'd like to be able to maintain my current lifestyle, which is probably somewhere in the middle of the spectrum (or maybe a bit lower). I don't want to work long enough to reach fat fire and I'm not interested in cutting back from where I am now. I do want to move internationally, but going from MCOL USA to (probably) Italy wouldn't really change my lifestyle much (in terms of expenses).
Do you have EU citizenship already and speak the language?
No to both at the moment. I'm helping my wife and kids get their Italian citizenship by descent. That will take a few years, but after that we should be able to move there whenever we are ready. I would like to get citizenship by marriage as well once my wife has her citizenship worked out.
I have started learning the language, but there are no classes available locally, so I have to do it all self-paced with digital courses, which is challenging. I'd like to become fluent by the time we are ready to go, but even if I can get some basic skills, I can work on immersion learning once we are there. Our current plan is to avoid putting ourselves in an expat community where we can get away with never learning the language properly.
Going a little off-topic here, but do you mind if I ask which resources you're using to learn? I'm in a very similar boat, so far I've been using the Language Transfer and Michel Thomas courses, but I'm always on the lookout for more.
I think lean probably... fat FIRE seems highly unlikely in my situation. I like the idea of working part time in the future without being so stressed for money. Just want to have enough to live on in my current home, help my parents in their old age, and not be too bored in the future.