FIRE, which stands for Financial Independence Retire Early, is a system that involves saving aggressively, spending judiciously, and investing smartly to achieve financial freedom and retire early. One of the main benefits of the FIRE method is that it allows you to retire at an age much younger than the traditional retirement age of 65 i.e. you can retire at 40, 50, or even earlier. Additionally, implementing this financial independence strategy will provide you with a sense of financial security and peace of mind knowing you don't have to live paycheck to paycheck or depend on someone else.
There are three main components to implementing the FIRE strategy to early retirement 1. Saving Aggressively: This means living below your means and saving as much as you can. Ideally, you should aim to save at least 50% of your income. 2. Spending Judiciously: This means being intentional about your spending and avoiding unnecessary expenses. To do this, you'll need to create a budget and track your spending 3. Investing Smartly: This means putting your money to work for you by investing in assets that generate passive income, such as stocks, real estate, or index funds. To invest smartly, you'll need to educate yourself on different investment options and create a diversified portfolio that suits your risk tolerance.
👉 Video Chapters: 00:00 Financial Independence Retire Early 00:56 The FIRE Method 01:52 1. Save Aggressively 03:31 2. Spend Wisely 04:18 3. Invest Smartly 06:49 The 4% Rule of Early Retirement 08:20 FIRE Calculator & How It Works 11:00 Shankar's Viewpoint
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