For the past few years, I’ve been actively following and participating in the Financial Independence Retire Early (FIRE) community very closely. I’ve also started my journey towards achieving Financial Independence (FI). As for the Retire Early (RE) part, it’s an option as I have the ability to choose what I want to do with my time once I no longer have to work for money.

What Is Financial Independence Retire Early?

In short, Financial Independence Retire Early is a financial milestone that once achieved, would allow you to cover your living expenses for the rest of your life. This financial milestone is normally 25 times (or more) of your annual living expenses or a certain amount of net worth. For me, my FIRE financial milestone is $2M in net worth and I am already 70% there.

Why Would You Want To Reach FIRE?

Sometimes, when I asked people if they would like to achieve FIRE as soon as possible and I would get an answer like, “I love my job and I don’t want to retire early. Achieving FIRE is not necessary” With such answer, I think that some people may be putting more emphasis on the Retire Early part rather than the Financial Independence part. This leads me to the question, “why would you want to reach FIRE?” Here are my ten compelling reasons to achieve financial independence retire early.

10) Fewer Money Worries And Eliminates The Fear Of Unemployment

The most obvious reason to achieve FIRE is to have fewer money worries. Once you don’t have to worry if you have enough money to pay for the next mortgage payment or put food on the table, it’ll lead to a reduction of other stresses in your life. The side effect of fewer money worries leads to the elimination of your fear of unemployment.
 

In today’s fast-changing economy, there is no such thing as job security anymore. As long as you are still dependent on your job to pay your bills, the fear of unemployment will always be there. Your financial health can be jeopardized if you suddenly lose your employment income. The only way to eliminate your unemployment risk is to achieve FIRE.

9) Easier To Earn More Income

It takes money to earn money. Once you have a certain amount of money, it’ll be very easy for you to earn more money. Though I only reached about 70% of my FIRE net worth goal, I can see the great effect of my money working for me. With a great second quarter this year, my net worth increase by almost $110K. This is the effect of accumulating assets and the commitment to reaching FIRE.
 

Comparing to five years ago or earlier, I’ve never thought that increasing my net worth by $100K per quarter would be possible. With my current net worth, every quarter going forward, the possibility of increasing my net worth by a $100K is quite possible. As time goes by, it’ll be easier and easier as the value my assets increases.

8) The Option To Give An Inheritance

I am a strong believer in raising financially responsible kids and allowing them to find their own ways to build wealth. However, I experienced first hand how difficult it was to pay off my student loans with minimal financial assistance. If I have the money, it would be nice to give my kids a head start in life after they finish post-secondary school. I would like to give them an inheritance earlier instead of after my passing. I think that an inheritance would be of greater help earlier in their lives rather than later.

7) Able To Negotiate Better Deals With Your Financial Institutions

The more financial assets you have, the more valuable you are to the financial institutions. Hence, you can make more requests and negotiate better deals when you have assets. A couple weeks ago, I was able to negotiate better borrowing rates, fees waived for my accounts and received a bonus reward of $1,300 when I moved my investments from one investment brokerage to another.
 

I discovered that when you don’t have assets, you’ll be paying your financial institutions to get any kind of services. However, when you have assets, your financial institutions will pay you for the opportunity to serve you. Wouldn’t you want to be paid and receive a service that you need anyway?

6) Getting Better Perks With Credit Cards

On top of being able to negotiate better deals, I am also getting better product offers and more free perks from my financial institutions. I don’t want to brag, but I actually feel important and am getting free services without having to ask for it. A few months ago, I received two awesome VIP hockey tickets to the Maple Leafs games with seats that were just four rows from the penalty box. Toronto hockey fans will definitely know how hard it is just to get any tickets to the Leafs’ game in Toronto.
 

When I apply for credit cards, most often, the cards that I am being offered now are mostly the World Elite Mastercards. This class of credit cards have some of the best rewards and are mostly free of annual fees. Check out my best credit cards combination post to see the what free perks that you can get too.

5) Able To Help Others That Need Financial Assistance

Being in a more fortunate financial situation gives me the ability to help out others around me. When you are in a stable financial situation, it gives you the peace of mind to know that you can lend money to other without the fear of not seeing your money again.
 

When I just started saving, it would be very difficult for me to lend a significant amount of money to anyone. At my current net worth, I feel a bit more financially secured and I am able to accept the risk of losing my money when I lend it out. I am able to lend out my money based on a compassion point of view rather than a monetary point of view. (This doesn’t mean that I am actually giving my money away if I lend money to other. I still want every penny back. I am just forgoing the opportunity to make money with that loan.)

4) Achieve A Higher Standard Of Living

When you achieve your FIRE financial milestone, many options open. One of those options is to live on a higher standard of living. Since you are at a stage where you don’t need the extra income, you can freely spend the extra money that you make and enjoy a bit more luxury in your life. If you have worked that hard to achieve your financial milestone, you definitely deserve to enjoy the better stuff that life has to offer.
 

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3) Pursue Unfulfilled Dreams Or Passions

Do you have an unfulfilled dream or a passion that you want to pursue? Once you achieved FIRE, it’s never too late to pursue your unfulfilled dream or passion. For me, being able to play a musical instrument fluidly had always been a dream of mine. I will be able to afford piano or guitar lessons once I achieved FIRE because I have both the time and money to do so.

2) Spend More Time With People That Matter To You

One thing that I am not able to do right now is being able to spend more time with the people that matter most to me. I spend at least ten hours away from my home on a daily basis. On most days, I am actually spending more time with people at work than with my family. Not that I don’t like the people that I work with, I definitely prefer to have the choice to spend my time with the people that matter to me.

1) Freedom To Choose What You Want To Do With Your Time

I think that the person who describes FIRE best is Tony Robbins. Here is one of the inspirational money quotes that pretty much sums up my entire FIRE post, “Do what you want, when you want, where you want, with whomever you want, and as much as you want.”

My Two Cents

Don’t think of achieving financial independence retire early as an end to your work life and the start of retirement. Instead, think of it as the start of a new beginning. A beginning of a life where you have all the opportunities to pursue whatever you want and spend your time with whomever you want. Do you like this sound of it?

 
So, readers are these reasons compelling enough for you to pursue FIRE? Are there any reasons that you think are more compelling for others to achieve FIRE? Do you have a plan to achieving Financial Independence?