Picture this: It's lunchtime at the hawker centre. You & your colleagues are queuing up for cai png. Auntie's serving spoon is poised, ready for action.
"Siew yoke, long beans, & omelette," says your friend.
"Steamed fish, tofu, & kailan," you order.
"Curry chicken, brinjal, &... eh, add on some fried egg," chimes in your colleague.
Three totally different meals, yet somehow, you all end up paying $3.50.Â
Same price, different choices, yet everyone is satisfied.
Turns out, the journey to financial independence isn't so different. Just like how you can customise your cai png order, you can tailor your FIRE (Financial Independence, Retire Early) journey to suit your preference, lifestyle & goals.
There isn't just one recipe for FIRE success. In fact, there are four main types of FIRE, each catering to different tastes & appetites for risk & reward.
Curious which FIRE dish might satisfy your financial cravings? Let’s unpack the recipe behind the different FIRE types first.Â
1. Fat FIRE: Living Large in Retirement
Fat FIRE is for those who want their retirement to look less like a HDB flat & more like Sentosa Cove.
Who it's for – High earners or ambitious savers who want a luxurious retirement.
The strategy – Save & invest aggressively while maintaining a comfortable lifestyle.
The goal – Early retirement with high annual expenditure.
The reality check – This is the most challenging FIRE to achieve. You'll need to be earning big bucks or be a savings superstar.
Fat FIRE means you can still enjoy your weekend brunches at Dempsey Hill now & in retirement. But it'll take some serious financial chops & hard work to get there.
2. Lean FIRE: The Minimalist's Dream
Imagine living your best life on a budget that would make even your thrifty ah ma proud. That's Lean FIRE for you.
Who it's for – The minimalists who can live happily with less.
The strategy – Aggressive saving & bare-bones spending.
The goal – Retire early with lower-than-average expenses.
The reality check – You might be eating more maggi mee than mala xiang guo.
Lean FIRE might mean trading your Orchard Road shopping sprees for Bugis Street bargains, but hey, if it gets you to early retirement, why not?
3. Barista FIRE: The Best of Both Worlds
Named after the idea of working part-time as a barista, this FIRE type is all about flexibility.
Who it's for – Those who want to escape the corporate rat race but don't mind some work.
The strategy – Save enough to cover most expenses, then work part-time to fill the gap.
The goal – Transition from high-stress careers to more enjoyable, flexible work.
The reality check – You're not fully retired, but you have more freedom to choose your work.
With Barista FIRE, you might trade your suit & tie for a barista apron at a hip cafe in Haji Lane.
4. Coast FIRE: The Long Game
Coast FIRE is like planting a durian tree. You do the hard work upfront, then sit back & wait for the sweet (& pungent) rewards.
Who it's for – Patient savers who don't mind working, but want options later.
The strategy – Save aggressively early, then let compound interest do its magic.
The goal – Build a nest egg that will grow on its own by retirement age.
The reality check – You'll still be working, but with less financial stress.
With Coast FIRE, you might keep your day job, but you'll have the peace of mind knowing your retirement is sorted. No more panicking about CPF top-ups!
Finding Your FIRE
Now that you're familiar with the different types of FIRE, you might be wondering which path is right for you. Everyone's financial journey is unique, much like how we all have our preferred cai png combinations.
To help you navigate these options, stay tuned to our campaign to find out more about the different FIREs & learn about your financial goals, risk tolerance, & lifestyle preferences.
Editorial Note:
Opinions, analyses, reviews or recommendations expressed in this article are those of the author alone, & have not been reviewed, approved or otherwise endorsed by any third party. Our campaign serves as a starting point, but remember your FIRE journey is yours to customise.
References
[1] DBS (2024). "Is FIRE for you?"
[2] Investopedia. "Financial Independence, Retire Early (FIRE): How It Works."
https://www.investopedia.com/terms/f/financial-independence-retire-early-fire.asp
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