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Achieving FIRE is important
Being able to save and consistently invest some of your money is a key step to retire early. Most of us will eventually retire when we are older, but there are some people that have the goal of retiring early. They want to live a free life, away from corporate stress. They want to be able to make their own decisions without any restrictions. Saving and investing is one of the ways you can achieve this faster.
The FIRE movement
The financially independent retirement early movement has been gaining new adopters since the last decade. A vast number of younger individuals who start their corporate jobs are looking for new ways to live their lives. Perhaps driven by their parents’ life experience. They seek to work hard during their 20’s and 30’s so that they can retire early, travel the world or enjoy whatever they want. This restrictionless life is the dream for many entrepreneurial young people. However it is not so easy to achieve, and besides extreme frugality, it requires constant saving and investing.
Save = Investment
To achieve fire the first thing you have to do is to save. Ideally, you should want to focus on saving over 20% of your income. Do not forget to set aside an emergency fund in case something extreme happens. After you have put aside a large enough emergency fund, you should focus every month on channeling your savings to investments. These can be made in stocks, index funds, real estate, commodities, and the list goes on. It is important for you to keep your investment portfolio diversified so that you are always protected against several risks.
The faster you convert your savings into investments, the faster you will be able to achieve your fire goal.
Stick to the plan
To achieve FIRE, the most important attribute is the focus. You need to focus on your end goal, so you can carry out everything as planned. Try to maintain some targets, and make sure you reward yourself along the way. Keep your saving levels steady throughout the year. Of course, there are some monthly or seasonal variances, but overall you should be able to achieve what you initially plan.
Prepare different income sources
Use your investments as future income sources that you can receive during your retirement. This is another important aspect that allows you to easily collect income, without much effort. Having these passive income sources is a great way to ensure you reach FIRE faster. One of those sources of passive income can be growing dividends.
Umar Nisar was born and raised in the busy city of Abbottabad. As a journalist, Umar Nisar has contributed to many online publications including PAK Today and the Huffing Post. In regards to academics, Umar Nisar earned a degree in business from the Abbottabad UST, Havelian. Umar Nisar follows the money and covers all aspects of emerging tech here at The Hear Up.
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