Awakening A Sleeping Giant: Has The Pandemic Killed The FIRE Movement?

Frankly, the very question baffles me.

The Coronavirus-inspired pandemic has killed businesses, locked down communities and sent thousands of people scrambling to find those unemployment forms as companies layoff or furlough their staff in droves.

The U.S. Labor Department said that over 36 million people filed for unemployment benefits in two months, which is a rate that – as the media loves to say, is the “worst since the Great Depression“.

Drama sells, after all.

Thus, I’ve been asked if this is the end of the FIRE movement, and the question throughly confuses me. Why on earth would a dramatic rise in unemployment, an unsteady stock market and unclear future do anything other than boost the life-changing concept of financial independence?

Financial independence reduces risk and removes our dependence on external forces that we cannot control.

It has not killed FIRE. In fact, it may have done the opposite.

The FIRE movement is just getting started

Over the past several years, the FIRE movement has exploded. FIRE is an acronym that stands for Financial Independence Retire Early, and it describes a growing movement of people who are rapidly saving money, cutting back on their lifestyle, and quitting their full-time jobs.

I am a devout FIRE proponent. I’ve done it.

Often in life, there is no better teacher than reality. Supporters of the FIRE philosophy could expel the virtues of financial independence until they are blue in the face, but most people won’t listen. They go, “Uh huh…”

Why? Because talking about money is an emotional topic. Our money relates directly to our choices, habits and lifestyle.

And during the recent bull market, everybody made money hand over fist. And, a sudden job loss was the last thing on most people’s minds.

Consumerism was alive and well, pushing the total consumer debt in the United States past $13.8 trillion.

Saving money for an uncertain future seemed like worry over nothing.

Until a killer airborne virus shut down the entire world.

Reality is the best teacher

Since the Great Depression – well before the larger FIRE movement, no other set of events could have proven the wisdom behind achieving financial independence better than the pandemic.

The pandemic taught us that:

  • sudden job losses happen
  • things can change on a dime
  • the stock market is irrational
  • saving for a rainy day is always smart

And, all those teachings directly relate to the core tenants of the FIRE movement. Emergency funds, controlling your lifestyle and investing in appreciating assets with the understanding that most stock investments are built for long-term growth are all crucial elements of the movement.

Early retirement may not be for everyone. But, financial independence remains a worthy goal that everyone should have.

And so, when someone asks if the pandemic has killed the FIRE movement, the answer is as simple as it is poetic:

The FIRE movement is only just beginning.

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I am not a financial advisor. Before making big money decisions, speak to a certified financial advisor for a tailored financial plan made just for you.