Camp FIRE Finance
In the world of FIRE and early retirement is that “what” and financial independence is the “how.” Simply stated: no FI, no ER.
Financial independence, or FI for short, is when you’re investments generate enough cash to cover your expenses. That’s the holy grail because it means that money is no longer an object. You’re financially free!
Not Everyone Should Pursue Early Retirement, but EVERYONE should absolutely strive to become financially independent.
When you’re financially independent, you’ve got options. You can go to work or quit. Take a vacation or lie on the couch all day. What you do doesn’t matter because you’re financially free.
The best thing you can buy with your money isn’t more stuff – it’s freedom. When you no longer have to trade your time for a paycheck, then suddenly you can do whatever you want with your time. You’re free! And that’s what financial independence is all about.
Achieving FIRE is something many people aspire to achieve – but these goals require a lot of hard work. It can be difficult to retire early when you simply work for someone else throughout your life, so many early retirees guarantee their independence through investments and by starting their own businesses.
The burnout rates in practicing physicians and physicians in training (medical students, residents, and fellows) are simply alarming. The problem seems to be getting worse with the decreasing autonomy, unhelpful/encroaching administrators, and the ever increasing financial burden of our student loans.
While you may think that physician burnout only impacts doctors, evidence shows that it unfortunately leads to bad medical care for our patients, too. With that big of a problem, what would you think if I told you that financial independence may have the power to save our physicians?
Let’s dig in.
The steps to financial freedom are not ‘one size fits all.’ Many people believe that financial freedom is all about their finances, there’s more to it than just that – it’s about more than money.
Sure, you can achieve financial freedom through proper financial planning and following all of the key personal financial ratios.
You should follow solid financial practices like creating a budget, monitoring and controlling your expenses, and saving a good percentage of your money.
Generating multiple sources of income and making numerous investments to help increase your cash flow will also help you achieve financial freedom. But, there is more to financial freedom than just the state of your budget and your portfolio.
Many that pursue FIRE become obsessed with financial independence. People will set a date when they expect to retire. Some shout it out to the world, while others keep it to themselves, afraid of jinxing it if they share it publicly.
We create excel sheets and compulsively check the numbers by running them through different retirement calculators. We zoom in on THE DATE and suddenly, it becomes the focus of our existence.
Suddenly, we find ourselves living in negative numbers.
Financial independence and early retirement might seem like an impossible goal, but it’s not an all or nothing deal. Along the way there are six layers of financial independence, each one giving you a bigger and better taste of that freedom that you’re after. These are the steps to reach financial independence.
