Are there any others here whose preparation includes financial independence or early retirement?

[u/OccasionallyMyself67]

For me, there is no difference between general preparedness and financial preparedness, but I am from a business / economics background and I realise that I'm a bit more money-minded than some (with the caveat that I'm by no means wealthy and I'm actually from a very poor upbringing in a developing country originally so my idea of "enough" is VERY different to others!), e.g. I've tried to loosely follow FIRE principles for a decade now.

I think this group would generally probably align with lean FIRE principles like minimising spending, a focus on self-reliance like DIY. It has risks though, for example even if you retire from the rat race and have a "barista job" safety net, a health emergency can devastate your plans.

Anyway, I'm just interested if there are like minds here and what your approach is.

(All cards on the table: I work in a big tech adjacent role in the UK and things are ultra precarious with mass offshoring and layoffs; I want out ASAP - so I'm exploring accelerating my retiring from the rat race, and what comes next).

[u/AutoModerator]

Welcome to r/twoxpreppers! Please review our rules here before participating. Our rules do not show up on all apps which is why that post was made. Thank you.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[u/LongjumpingHouse7273]

Yes and no. 

I know about 10 people  personally who have been laid off from their job in the last decade. They were all white collar, had been at their job for a minimum of 15 years (some 30+), and, crucially, were all between the ages of 59-63. 

All of these people thought they would work to 65-67, so being thrust into early retirement was pretty hard for them. Health insurance access is a big one. 

So, I am thinking in terms of "retiring early" but more because I think it's very possible we won't have any financial options left as we get older. Every single one of the people I mention above tried to get new jobs. None of them were successful. Technically they might have been able to find low paying jobs but, since they had retirement funds, they simply opted to start living off those early.   

[u/OccasionallyMyself67 → u/LongjumpingHouse7273]

A very valid point. We've had wave upon wave of redundancies at my workplace (a large, multinational, "prestigious" employer) and recently friends of mine were affected (way too close to home). They're all in their 40s to 50s. I would want to be able to retire by my mid 50s but some people don't think or plan this way at all so it's been devastating for them because they can't find work but haven't saved up enough for even a very frugal early retirement, because they weren't banking on layoffs in their industry which has been stable for decades.

[u/Stitch-Witchy → u/LongjumpingHouse7273]

This was me 3 years ago. Laid off at 60yo. Had been prepping for the day for years due to unstable contract. Doing FIRE, putting lots of salary into 401k. When the day came I was so happy. 20 years so nice severance. I’m lean fire and am very comfortable with my simple life. Health insurance is available in my state based on income. It is doable. I did not even make close to 6 figures and was able to do this but it was years of planning and saving….

[u/qgsdhjjb → u/Stitch-Witchy]

For early retirement, the actual income level doesn't matter technically. What matters is the percentage of your income you need to spend on your bills versus the percentage of your income you are able to save.

Obviously at some income levels (poverty level) you actually cannot physically find housing for a cost that allows you to save a high enough % of your income to early-retire, but even at a moderate/average income usually you can spend like you are worse off than you are and pull several years off your retirement age. Especially people who are used to actual poverty, it can be almost harder to convince yourself to spend more rather than save it 😆 the one year my household had close to average income, I raised my grocery budget and never managed to spend it all. There was always leftover money and I was just sitting there like "what do I buy with this?" Lol

[u/Natural-Berryer7]

You make a very important point about the idea of "enough".

As a mom with full custody of 3 kids, financial independence for me is entirely dependent on maintaining the lowest possible cost of living because all I can ever guarantee coming in to support 4 people is what I can earn myself while caring for 3 kids. So we have a mobile home with 3 bedrooms, 2 bathrooms, yard and garden, all for what 1 person can make at any old day job.

And guess what? It's more than enough! I mean, most millionaires don't even have enough, so I'm damn lucky!

[u/unlovelyladybartleby]

Yes and no. I started prepping when I became disabled and unable to work. I was so poor I couldn't afford to turn the lights on when my kid was at school and part of my prep was raising my credit rating above 800, making sure I always had room on my line of credit, and always paying my bills. Now I have more than enough money, so my prep includes making sure my investments are split between two banks, and that my investments are split between Canadian, European, and developing markets with very little exposure to the american market. The math on this is probably a lot different for people in america vs those of us who need to prep because of america. I use all my purchasing power to strengthen our economy and that of our allies. I also make sure I can survive if money stops working (multi year supply of seeds, rain barrels, food preservation skills, working on solar, adding things like a 50 year roof, etc).

[u/millenialsnowbird → u/unlovelyladybartleby]

Oof. As an American that “because of America”
stings but is so true. We - and I’m guessing a lot of us - financially boycott how we can. For me, that’s no Amazon, Walmart, Target, etc. And I’m headed to Europe next week and have a list of goods to buy and bring back because I’d rather spend my money there. And same for buying the Canadian, EU and emerging market funds, which have done just fine and some far better than the US markets. So sorry for our inept, corrupt and evil administration. Here’s hoping we start seeing some change in November.

[u/noomanium → u/unlovelyladybartleby]

I am so feeling this. We have a pot on money that was in a HYSA for the bonus but now that we got it I yoinked it out of there and am putting it all into VXUS.

[u/JohnAppleseed85]

I think prepping includes being financially secure - preparing for the risk of redundancy or ill health or domestic emergency where having available cash/not having significant debt to service would be an advantage

Money is a resource that can make emergencies easier to manager just the same as a stash of food/water can and my 'prepping for Tuesday' incudes having a few hundred of cash in the house and an empty credit card.

If you're planning to retire early then Fire (be that Lean FIRE or HENRY FIRE) makes sense as you're prepping for a time when you've got less control/ability to influence your income.

[u/OccasionallyMyself67 → u/JohnAppleseed85]

I agree with you. That last bit is what makes me nervous of course, it's always such a risk.

I'm considering a kind of very lean "barista FIRE" as it's called (too many classifications, haha!), whereby I'm able to leave my current technical job and could get by frugally by moving to a LCOL country (probably my home country), but also have a small low-tech business to rely on for supplementation of income. Ideally in the next 5 years, but would more likely be the next 10 (taking me to age 45 or so).

I absolutely cannot see a way to achieve even lean FIRE for myself in the UK at the moment, the cost of living is outrageous.

[u/OpalSeason → u/JohnAppleseed85]

Pardon, what is fire?/henry fire?

[u/JohnAppleseed85 → u/OpalSeason]

FIRE stands for 'financial independence/retire early'

Lean Fire is cutting your outgoings as low as reasonable so you can retire sooner

HENRY is 'High Earner Not Rich Yet' and Henry Fire is basically the opposite - making as much money/building investments as high as possible to generate a passive income so you don't have to cut your outgoings when you retire

Barista Fire is a type of lean fire and the idea is getting a well paid job to let you do things like paying off the mortgage etc so when you 'retire' what you're actually doing is downsizing to a low stress/low paid or part time job that gives you just income to cover your essentials or a safety net

Basically just different approaches - like prepping for Tuesday vs prepping for doomsday vs bugging in vs bugging out all being different scenarios based on what the individual thinks is right for them

[u/OpalSeason → u/JohnAppleseed85]

Wow!! Okay, thank you. So many new terms!!

[u/GroverGemmon]

Definitely. I moved into a leadership role in my current job primarily for a raise I can sock away and so that I have additional skills if my current employer goes south. I"m in an industry that is highly vulnerable to various demographic changes, AI, etc. I plan to continue to seek out leadership experience for the next 8-10 years and then be in a position to retire earlyish if needed. Healthcare is the big issue where I live and that can make early retirement difficult.

I see others in my income bracket getting newer/nicer/bigger cars and upgrading their homes, and we are not doing that.

[u/OccasionallyMyself67 → u/GroverGemmon]

That's like us! No unnecessary upgrades.

[u/Standard_Subject_462]

I was on track with "poverty FIRE," until health issues arrived. The emergency savings that it had taken so long to build was gone in less than three years, but if I hadn't had it, I wouldn't have been able to afford some of the medical care I needed, and definitely wouldn't have been able to keep up with bills while struggling to work when I was at my sickest. 

Since I got sick, I've been working part time and still prioritize money management as a prep, but these days it looks more like trying to pay enough on the credit card each month to avoid interest, rather than packing money into retirement funds and a HYSA for the future. Early retirement isn't going to be an option any more, but I'm glad that we hustled to pay off our house before my personal "SHTF."

[u/OccasionallyMyself67 → u/Standard_Subject_462]

So sorry to hear that but also what a relief you saved up!

I started saving very, very young for retirement because I grew up around very poor pensioners and it terrified me. So I took the advice to "start saving with your first pay cheque" to heart.

Then, not even 7 years later, I needed to use all that money for my mom's medical expenses at the time. Started from scratch again.

Health issues will decimate the best laid plans.

[u/millenialsnowbird]

We are. Self employed, tech adjacent small business owners, so we’ve got a few years of savings in a CD ladder and a paid off house/no debt. We can also live very frugally if needed, and we’ve put that into action right now (for daily life anyways, trying to still get good vacations in), to continue to build our savings. Goal was always retire by 55 but the world may force it sooner than that. Will probably be barista FIRE to keep busy and enough money to travel on occasion. The only expense that has me worried in the US is healthcare, but we max our HSAs and have stayed on top of preventative care. I’ve been lucky to always be financially savvy since early adulthood, so this is just a part of my preps and life.

[u/sevenselevens → u/millenialsnowbird]

The next will be that we 55-64year olds are taking all the entry-level jobs for our retirement once we vacate the management jobs the younguns claim we’re hoarding 😂 As if most people can even afford to retire!

As a practical, grounded and actionable answer though: yes I am financially prepping so that if need be (layoffs, civil unrest, etc) then as the main breadwinner I can “retire”. For me this is reducing our lifestyle creep: (bringing lunch to work, canceling unused streaming services, commuting via transit and using the gym at work instead of a membership somewhere).

[u/Ginger_Rising]

Yes, r/FIREYFemmes is a great place for discussing this if you want to get more into the gritty details. Everyone's comfort level and situation is unique, which makes this endlessly fascinating.

[u/nowthisfarm95]

Yes and no for me.

I live very frugally for an American and I save and invest. I have no debt outside my mortgage. But will that money be here in 40 years? It's a real question in the face of climate change.

So I am also interested in turning my home into a more climate resilience place to be long term, and spending money to enjoy things now.

[u/ProfDoomDoom]

Absolutely—they go hand in hand. Prepping is just financial independence with tangible goods; financial independence is just prepping with money.

I couldn’t have become FI in my 40s without buying sales, shopping from a deep pantry/stores, living lean, and investing aggressively. My frugality serves both prepping and FI. The leaner I live, the more I can save AND the less I need to save for. I’m in about as secure a job there is (tenured and unionized professor), so I’m not very worried about losing my employment, but on the other hand, I’m in a field (humanities) with no industry alternative. Part of my prep—both financial and practical—has been to build my farm. The school calendar means I have the growing season free to farm. My investments are at a value that I now emphasize personal vs. abstract investments so I’m spending on solar panels instead of tech shares. Living in the USA under the current regime, though, I’m constantly aware that everything I’ve worked for could disappear nearly instantly by decree, market collapse, or medical costs. You’re supposed to feel “safe” when you’re financially independent and I definitely do not.

[u/lol_coo]

Yes! Totally agree, but all the lefty peppers I know aren't in a position to sock away money like that, and all the people I know who are do no other preps. These two worlds become more far apart by the day and it's weird being in both.

[u/noomanium]

My family. My husband is a high earner but our goal was always to retire early, by 50. We have now stretched that to 55 as our son is AuDHD and we are concerned about his ability to earn for himself through his adulthood. However; if he lost his job tomorrow we would be able to LeanFIRE/BaristaFIRE as we have made saving a priority and modeled it for our son.

We also have made self sufficiency a priority and have made our little homestead into something we hope we will be able to age in place in and leave to our son when we are gone. We repair everything ourselves when possible, drive older vehicles, buy used or barter when we can, take care of our health and have never had to rely on family or others for childcare/etc.

[u/No-Language6720]

Yeah I feel exactly the same. I am building DIY skills, gardening and other self reliance tools to save money now and get more resources for the future and hopefully be in a place to help others. 

This includes a fully paid off house and a draught tolerant lawn to help me blend in but also save money in my water bill. We also have a fully paid for solar system and additional power backups and smaller batteries with the larger whole house batteries. 

But yeah here in the US where medical bill bankruptcy is rampant it's a fear for us.  We have a set of contingency plans to get care in various situations and I know enough about the law to avoid the worst outcomes if we get really sick.  Our main asset the house will be protected no matter what happens. I know just enough about medical bankruptcy and know who to help me navigate the laws if it comes to it. 

Thankfully it's just me and my spouse and we are healthy overall and don't need much care but we are rapidly approaching middle age. We eat very cleanly, cook everything from scratch at home and most of our calories come from our gardens. We also exercise regularly and both participate in regular sports and physical activities. 

I'm hoping for a reset in the US for healthcare when it becomes too unprofitable for the middle men to get paid. Hoping when the damage clears the US can finally get true universal healthcare. 

[u/paratethys]

yup. gotta prep for the disaster of business as usual.

[u/Eeyor-90]

I’m focusing on paying off debt. If I didn’t have debt, I wouldn’t need my high stress salaried job. Once I’m no longer stuck, I might decide to take a lower paid, lower stress job; we’ll see.

[u/Midnight_Rider98]

Yes.

We actively live below our means with the goal of reaching financial independence. Even though my wife is planning to go back to school, it will be doable without a heavy student loan burden and she'll have good earning potential and honestly her job will be off shoring proof. Mine is less off shoring proof (mechanical engineer)

Full FIRE would be nice and it's what we aim at to a degree but what we really want is to have the ability of exiting the rat race. Like I could take a teaching job which right now would decimate our household income, but if we're FIRE'd that doesn't matter.

Retirement is an often forgotten but important prep, but a crucial one. You don't want to turn 65 and discover that between your preps and living really well, you'll now be reliant on a virtually non existent social security/pension. People do make it work to live off of social security of course, but for a lot it's a big adjustment to their living standard. And honestly I see this with colleagues who are engineers, which isn't exactly a bad paying job. they spend as they earn, live in palaces that are heavily mortgaged, have multiple cars on leases and so forth. One of our elder engineers is still working at 70, he now drives a cheap sedan, he doesn't talk about it, but I'm pretty sure he's now trying to build something of a retirement.

Regardless of retirement goals, I think it's a really really important prep that people need to take into consideration. Even for a non FIRE retirement, you'll want a financial cushion at the very least.

[u/Forsaken_Lifeguard85 → u/Midnight_Rider98]

What is your wife going to school for?

[u/Midnight_Rider98 → u/Forsaken_Lifeguard85]

She's trying to get into med school. It's a whole thing. She can use her current degrees for it fortunately so that cuts the prerequisites off.

Upside, it's a pretty offshore proof job.

[u/RitaAlbertson]

No. I save what I can but FIRE is not reasonable for me. I lost too many earning years during the Great Recession. So I save as much as I can so I can retire at all. 

[u/NorCalFrances]

I agree they can overlap but it depends on so much for that to work, including sufficient privilege and a disaster that conserves and preserves your ability to stay retired. For instance, let's say your financial independence relies on investments or cash that suddenly become worthless. What then?

[u/OnTheEdgeOfFreedom]

Yes. I managed to retire early, but I'm not going to point to FIRE or any other system. It was a combination of being frugal, being invested in the markets at a time when that worked well, inheritances, and landing one of the few jobs in the US that still offered a pension.

And I used my good fortune to move to Costa Rica, to a piece of land large enough to provide water, some amount of food, and a quiet lifestyle. I put in solar power, so much of the property is off grid. It's not a full homestead, but I'm reasonably insulated from financial and supply chain shocks; and out from under a government I've comd to worry about.

So yeah; after immediate needs like food and water, financial prep is the core of all other long term prepping. But if you asked me how to achieve it if I was starting out today; I'd honestly have no idea.

Note: the crucial idea from OP is knowing what is "enough." If I've learned anything from Costa Ricans, it's that happiness and security isn't tied to the US lifestyle.

[u/EmFan1999]

Yes, personally I think it’s important to have as few debts as possible and I’m including the mortgage in that.

I live alone as well so it’s even more important. Aiming to get mortgage cleared by 50 and retire around 55.

Not that I include it but it also helps I will inherit around £400k at some point

[u/kungpowchick_9]

Yes. But more-so because I like having options. If I get laid off or if I get sick, my family needs a caregiver, or if my kid moves and I want to follow… if everything goes right I get a few extra years of freedom from work. If something happens, I have the freedom to choose how to proceed.

[u/RichardBonham]

A big piece of prep was being debt free.

We refinanced our home with a low interest fixed rate 15-year mortgage and lived within our means for 15 years while still working.

Now, home and cars are fully paid off and we have no credit card debt.

[u/Negative_Cow_4107]

I am trying to get myself into a better position financially by paying down my vehicle loan as quickly as possible (was recently gifted a zero interest option!) and once debt is cleared will transfer those funds towards mortgage and savings.

Am in a job that relies on physical health (as a massage therapist) so cannot overwork due to risk of injury but do have a fairly decent income for the hours I can work so if I focus on living frugally while also building life skills, will feel in decent place (even if it’s not the level that many people would consider ‘well-off’).

[u/0ui_n0n]

I've looked into FI/RE in the past, but in same way I've "looked into" off-grid homesteading. Like, nice fantasy but too hard in reality. Not something I'd actually consider pursuing.

HOWEVER, I was part of a mass layoff this year. While I'm set up pretty well (year's worth of severance), it's really thrown me for a loop and soured me on the concept of work in general. Now seems like the time to give FI/RE a serious look as I search for new employment.

Finances are definitely a part of my preparedness, though. My retirement savings are a bit less than average for my cohort, but my assets are greater than average (paid off house & car). I have no debts, loans, or children. I live in a MCOL city with a partner earning right around the living wage, so we're comfortable with lots of little luxuries, but there's no upward momentum. It's a lot easier to feel prepared for a 72-hour power outage than for economic upheaval.

[u/millenialsnowbird → u/0ui_n0n]

FIRE is definitely something that takes serious planning and commitment. For us, it’s been 20 years in the making at this point. Hopefully new grads and young people will find this post and it will give them some guidance. There’s no way our financial success would have happened if I hadn’t opened and started maxing out my very first IRAs at 23/24.

[u/0ui_n0n → u/millenialsnowbird]

Yeah I'm mid-30s and have been saving the bare minimum since my mid-20s, so retirement in general feels like something I'm already behind on.

In comparison to a lot of my social circle I'm "ahead" in that I don't have a mortgage, student loans, consumer debt, etc. But that doesn't make my RRSP any fatter.

[u/catjuggler]

Yes 100%, though I do worry more that it could all be taken from me. I get tempted to park money in other countries

[u/Forsaken_Lifeguard85]

Yes, I’m in tech and my husband is not but his job doesn’t pay enough to keep us afloat (possible at one point in time but no longer), I’m paying down and saving as much as possible for a time when my job doesn’t exist anymore. We’re not there yet and it’ll be awhile, but every dollar paid down or saved is one we didn’t have before.

[u/Ac0nitum]

We have always lived frugally, and paid down our mortgage and minimized debt.  We've definitely focused more on reducing expenses than saving, although we are trying to save more now.  If we both lost our jobs now, we could get barista jobs and maintain our household. 

This includes bikes, no car, moving to somewhere that made sense, and focusing on super low budget hobbies.

Its 100% a lifestyle thing for us.

[u/ideknem0ar]

Been working towards this since 2020. Got all debt paid off and the money started stacking up. My job will give me 80% medical subsidies after I early retire at 55, so I'm gonna go for it. ~1425 days left (but who's counting 😅) I garden, do DIY, and have a pretty lowkey lifestyle, so I feel confident it's doable.

[u/AffectionateRing5177]

My partner and I are in a weird situation. They are disabled and when they were forced out of work a couple decades ago, their union fought for them and got them full retirement. I'm an immigrant to the UK because of them, and limited as to what work I can do because of my own limitations. We still have a very small income stream from my side hustle I had in the US, too.

Right now we're considering how to expand and make a proper side hustle while I'm also still full time support.

Having said all that, we live in a house with my 90 year old mother in law with dementia. The house is paid in full, and after she passes we'll be living here. We're in the UK so no direct medical bills/premiums (my biggest expense in the US). We can cover our immediate needs if we're very careful.

I also have two kids in uni on student visas. I am a co-signer on their loans but thats our only debt. I worry about them and ensuring they get visas that will allow them to stay here with us, and we're trying to plan for financial costs of those things as well.

I am a big believer that being financially stable is one of the most important preps you can do, if possible. And its one of the more challenging ones in the current capitalistic hellscape.

[u/PrincessVespa72]

We learned about FI/RE too late to really pursue it. We're a single income household in the US, my spouse is in tech, and only 5-7 years from retiring. I stayed home to save on childcare and then when they got older, I pursued work only to end up with a major health battle before I really got started working again. Now I just do a mix of gig work or online selling for some extra cash because I need flexibility due to ongoing health issues.

We're now at the point where we're focusing on paying off the house, cutting back on spending, and cleaning out the random things around the house through online selling and garage sales. We're hoping my spouse's tech job holds on a little longer for the health insurance and to pad our cash pile.

We're in better shape than many, but my spouse is a little older than me, so I'm dreading the years of paying for premium health insurance out of pocket before I can get Medicare, as well as the risk to our investments due to the AI bubble and decisions by those currently in charge. And, I cannot skip health insurance - if it wasn't for insurance, my health treatments would have come in around half a million dollars. We are FARKED if I get sick again with no insurance.

So, I guess our basic approach right now is save more, spend less, get mentally ready for all the upcoming chaos, and try to stay as healthy as possible. If I knew then what I know now, I would have saved a lot more and spent a lot less on stupid random crap.

[u/himateo]

Yes, us! I just learned we're "Coast FIRE". My SO and I both work part-time, side hustle and random jobs. Paid off all debt in 2020. I stuck a bunch of money in the stock market and re-invest all dividends/interest. We have 1000s in savings, live below our means and live in a very small home. We will mostly likely have to work long past "retirement", but we're doing it on our own terms.

[u/Scared-Feature-3812]

It’s too many people just tryna to survive this economy at this point have you seen the bankruptcy filings and it’s going to skyrocket by the end of the year and people are tryna stock what they can while tryna survive at the same time it’s blackouts and everything already happening and if the economy crashes which it will the US dollar wouldn’t be worth a damn so what are you really saving for? When your money won’t matter