By Karishma Vanjani Published: Sept 14, 2019
2:12 p.m. ET
The FIRE movement focuses
on finances, but not so much on emotional well-being
You made it! Now what?
Jordan, a physician from
Illinois, earned a fat paycheck, was frugal and had real-estate investments — a
perfect candidate for early retirement, some might say.
When he learned about the
FIRE movement, short for “Financial Independence, Retire Early,” Jordan knew
his savings were enough to quit a practice that was slowly burning him out. But
the idea of being financially independent made him anxious. Jordan felt he
would not only be leaving a job, but the identity of a doctor that he worked so
hard to build.
“I knew I was getting
tired of it, but it was never a reality to stop being a physician and start
being something else,” said Jordan, who prefers to be called by his alias Doc G
and blogs at DiverseFi.
Because he never envisioned a world where he wasn’t a physician, the option of
quitting work made him “scared, worried and anxious.”
Having enough money in
the bank and the potential to never work an office job again excites many
people on the journey to FIRE, but they often overlook the possible downsides.
To combat these feelings,
Jordan chose to slowly transition out of his scrubs and into the field of
public speaking, instead of giving up his practice all at once.
FIRE has been gaining a
lot of traction on social media. From Reddit threads to Facebook groups, the
community of individuals scouring the internet for saving hacks, investing tips
and simple calculations to retire well before they hit 65 has grown
considerably. Some people cut out all the nonnecessities from their budgets,
downsize their homes and work extra jobs to save enough. Others pick up
investment books and read through personal finance bloggers’ posts looking for the
right figure before they call it quits.
FIRE bloggers write about
the challenges and trade-offs associated with pursuing financial independence —
the skipped happy hours, the rice and beans in lieu of take-out dinners and
delaying a vacation or two — but not everyone opens up as quickly about the
impact on one’s mental health, before or after achieving it.
Anxiety and self-doubt
In his blog MadFientist, Brandon talks
about how he grappled with feelings of self-doubt and apprehension in the year
before he hit financial independence. He worried about whether quitting a
great-paying job was the right segue to his other life goals.
“I always assumed after
‘FI’ [financial independence] I would become an entrepreneur,” said Brandon.
“But to be honest, most of the business ideas I had just weren’t appealing to
me after ‘FI’ anymore because money wasn’t a motivating factor.”
Anxiety, one of the
lesser-known aspects of FIRE, plays a prominent role in this movement. So,
while retiring early with hundreds of thousands of dollars (or more) saved
sounds great, it’s common for anxiety to creep in when you don’t have too many
people retiring around you, said Brad Klontz, author of “Mind Over Money” and co-founder of the Financial Psychology
Institute. “In some ways, retiring at a standard age is easier.”
Retirement at any age can
shake a person up emotionally. Depression and binge drinking is common, as is loneliness and
deteriorating health. Getting psychologically ready to shed the
identity you have built over the years can be unnerving.
With FIRE, you take that
emotional vulnerability and turn it up a notch. Going against the classic tide
of life can add in a lot more worry: concerns about running out of money,
doubts of making the right choices and fears of no longer being useful to the
world. Not to mention the “I-told-you-so’s” from unsupportive friends and family
members if your plan fails.
Tanja Hester, an early
retiree who achieved financial independence a little over a year ago (and
MarketWatch contributor), said she had these thoughts on her journey. “A lot of
anxiety was over our savings — was it enough?” Hester said. “We did act on the
anxiety and made sure we saved, as some people would say, more than what we
needed.”
Apart from the degree of
emotional vulnerability, Hester, who is the author of the Our Next Life blog about
early retirement and the book “Work Optional,” pointed out another key
differentiator between the early retirement and retiring at a traditional age.
“Mental health and sense
of loss are similar but traditional retirement comes with benefits such as
Social Security and Medicare!”
Your health over
financial security
Klontz says FIRE
followers often fall into an existential crisis by focusing more on financial
security instead of planning what their lives will look like when they have
financial independence. “Part of what you need to think about is what
psychological needs are being met at work.”
His one advice for FIRE
pursuants is to start early thinking about ways to replace that feeling of
belonging and the social engagement they find at work.
Jordan and Brandon
wrestled with their own unique fears and anxiety, but both swear by one rescue
tactic — dropping money as a factor. “We have to start looking at what our true
identity and purpose are and what type of connections in the world are important
to us,” said Jordan.
Think big picture
While immediate
gratification after FIRE might seem fulfilling, it is short-lived. Passion and
purpose are the main drivers of enjoyment once the long vacation plans are
accomplished.
Klontz believes in going
long and creating a detailed vision after accomplishing FIRE. “Think about year
5,10, 25,” said Klontz. “Everyone has a list for the six months, very few
people have a plan for what they are going to do after their vacation.”
Find your identity
through discipline
While FIRE might seem
like a journey toward a life of no restraint, Brandon who achieved financial
independence in 2014 says following a routine and being disciplined makes him
feel like he’s making progress.
Bart Brewer, a financial
adviser, believes in the same philosophy to prevent yourself from being a victim
of restlessness after FIRE. “People who retire early typically have been
focused and disciplined to be able to get there,” said Brewer. “That same focus
and discipline will be required afterward — especially if one is considering
serving a purpose greater than themselves”
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