Achieving financial independence requires making big decisions and sacrifices: Should you downsize your home? Will you start saying no to happy hour more often? But for some people, it wasn’t as far of a leap after watching their parents do the same.
That was the case for Jessica, a blogger behind The Fioneers and a member of the FIRE community (which stands for “financial independence, retire early”). Jessica’s parents didn’t call it FIRE, but they retired in their 50s — and probably could have retired even earlier, she said. She watched them always live below their means, find ways to save at the grocery store and look to spend the least amount for the value of a product.
Now she’s on her own journey to financial independence, and she has internalized the lessons her parents taught her. When she joined Americorps after graduating college, she made $10,000 a year and lived in New Jersey with her husband. “We did everything we could not to go into debt,” she said. One strategy was to avoid dining out for an entire year unless they had a gift certificate or someone else was treating them to the meal.
FIRE is a relatively new term — coined within the last decade or so — but the concepts and qualities that make it possible have been long practiced. The lifestyle relies heavily on frugality, but also on discipline and delayed gratification.
Of course, the lifestyle comes with its fair share of challenges, including saying no to some social activities, forgoing some of the latest fashions or trends and building investment portfolios and savings accounts so they last for decades. It isn’t the right choice for everybody.
But some of the parents who did live frugally, or spent intentionally, left a mark on their children. Sam, who blogs at Government Worker FI with his wife and started working toward financial independence in 2018, said one of his earliest memories as a kid was watching his father go to the library to look through periodicals about every stock, and then photocopying pages about specific companies and investments. His father retired at 55 with a state pension. His grandfather, who came to the U.S. as a child, also retired in his 50s — and invested in stocks before World War II.
Some other lessons Sam’s father and grandfather taught him: He learned about side hustles — his grandfather bought and sold chickens in the ‘40s and ‘50s — and how to fix any broken or damaged fixtures in the house. “I like holding on to things until the last possible minute, until it’s all used up and needs to be discarded,” he said. “Anytime something broke in our house we always fixed it ourselves.”
A woman who blogs at A Purple Life and asked to be anonymous, is on track to retire in 2020 at age 30, inspired by watching her parents and grandparents quit the workforce in their 50s. Her parents’ lifestyle helped her understand what worked for her — and what didn’t.
“I learned from watching [my mother] what I didn’t want, specifically in transit,” she said. Her mom’s commute where she grew up in Atlanta was an hour and a half each way, and she didn’t want so much of her time spent in standstill traffic, so she moved to Seattle, where she could cut costs on transportation.
Her mother also never scrimped on the things she valued, like luxury vacations or her child’s education. “When things mattered, she was not afraid to spend,” she said.
Some parents may have learned about FIRE too late to leave the workforce in their 30s or 40s, but they still want to help their children reach those goals. Cody Berman, is already on the path to an early retirement at 23, thanks in part to his mom. She never knew anything outside of the traditional portrait of retirement, where you work until you’re in your 60s or 70s, but came upon the idea of FIRE after reading Mr. Money Mustache’s blog post about the math behind the lifestyle. She jumped on the opportunity to pursue financial independence, with a goal of hitting it in her mid-to-late 50s, and she encouraged Cody to do the same, he said.
He’s running full steam with that support. After seven months into his first corporate banking job, he quit because he realized his side gigs were generating a substantial income, even though many of his family and friends (minus his mom) were concerned about the decision. He drives the same car he’s had since high school, keeps food and drink costs down and saves about 80% of his income. He has a blog and podcast about financial independence, called Fly to FI. “My mom is my No. 1 fan,” he said. “It was a lot easier for me as a 19 year old to dive into this head first.”