Planners scoff, but young retirees have lessons for rest of us

The financial writer Suze Orman may be the highest profile baby boomer to blast the hopes of some younger workers to retire maybe 30 years early as just ridiculous, as she put it in a popular podcast.

To most of us it probably does sound at least a little ridiculous to try to build up enough savings in a dozen years or so to call it a career. But to question something like a rate of return assumption or how much you would need to save to quit at 35 seems to miss the point of this popular movement.

Focusing on these details sure makes it harder to see any useful lesson in what the FIRE enthusiasts are trying to do.

FIRE, a catchy acronym for "financial independence, retire early," isn't really about a sensible plan to retire at age 30 or 35. It's about willingly trading away material things that don't add that much to your life anyway for the flexibility to live without needing a paid job.

That might not be a bad way to live even if you plan to retire at 70.

It's easy to find lots of examples of this thinking just from FIRE bloggers here in the Twin Cities, who generally seemed to be both entertaining and informative.

The FIRE bloggers like pen names, which makes sense given that it seems normal to post family net worth down to the penny on the internet. Here in the Twin Cities the bloggers include Cubert, writing at Abandoned Cubicle, and the Financial Panther and Krystel at All She Saves.

Cubert, who appears to be in his mid-40s, wrote this summer that he's a year away from retirement. His journey started in 2014, he wrote, when he was so overwhelmed with a busy job in information technology and two young children at home that he started looking into early retirement. He quickly found the blog of Mr. Money Mustache.

In the financial independence community, Mr. Money Mustache is obviously an inspiration. His name is Peter Adeney and he's a retired engineer in Colorado now in his 40s who bagged the world of salaried work at age 30.

The main point of his blog is that retiring that early is possible if you are careful not to squander money on things that he considers wasteful, like driving a car.

Mr. M on his blog sure sounds busy, though, and not exactly retired. In the FIRE community working hard isn't the problem. It's jobs.

Job satisfaction has increased seven years in a row, according to the most recent figures from the Conference Board. But still barely half of American workers report being satisfied with their jobs, a far lower number than in the 1980s and 1990s.

"Most people start off in the movement with, 'I hate my job, get me out of here,' " said Gwen Merz, who until recently posted from Minneapolis to her blog called Fiery Millennials. "I started off roughly that way. I got into a corporate job and went, 'Ooh, this isn't fun, 40 hours a week in this chair … People do this for 40 years? This is crazy.' "

What FIRE believers seem to write about at least as much as "retirement" is not having to go to a job they don't enjoy. You can go to a job all the way through your 65th birthday if you want, but the point of financial independence is that the family's needs can be met whether you have a job or not.

Another issue in the FIRE community is the burden of all the student debt people accumulate training for regular jobs.

Krystel at All She Saves had more than $77,000 of loans from getting her college degree. She writes that one day she realized she had to change course or she would be making big payments for 10 or 20 years. The Financial Panther, Twin Cities attorney Kevin Ha, had even more debt that financed law school, with few options upon graduation other than getting a high-paying legal job.

Ha found that his job at the Minneapolis law firm of Dorsey & Whitney was a long-hour, high-stress way to make six-figure pay. The "normal" thing to do, he wrote, was to keep the high-paying law firm job, buy a lot of nice things and chip away at his student loans.

He opted for weird, repaying $87,000 in student loans in about 2½ years.

He could then afford to take a more rewarding law job in government for about $50,000 less in annual pay without crimping his lifestyle. He also enjoyed his "side hustles," which included dog sitting, figuring that since he had to walk his family's dog anyway, he might as well make some money by taking along another dog.

He appears to have plenty of hustle and enjoy working, yet he's not sure how much longer he will want a regular office job.

"A lot of FIRE people are really entrepreneurs," Ha said. "And what they are is risk-averse entrepreneurs. They want to do something different or start up something, but they're too scared to do it without a complete safety net."

Merz said she never worked harder than as a freelancer and entrepreneur in Minneapolis, putting in many more hours than she did at her IT job at Deere & Co. She's still committed to financial independence, but she's now looking for a corporate job again.

"I thought that I could live off of $25,000 a year and be happy, and it turns out that I don't like doing that," she said. "I like spending a little more than I thought I did."

"I'm going back to work so I can earn more money to save. So I can spend more later."