As I’ve said on the home page High Income Financial Independence Retire Early is about having enough money to be financially independent and able to retire early on a high income. I’ve got a number of personal goals that I’d like to hit along the way to getting to that high income FIRE.
First and foremost I want to build up my wealth and more importantly income to the stage where the passive income from our investments outside of super covers our essential living expenses of around $17.5k a year. That is stuff like paying the utilities, groceries, car bills etc and is a pretty austere lifestyle at best. As it happens this is pretty much where we’re at currently, so it’s great to know that if everything went pear shaped with my job there is money for food on the table and the bills are getting paid.
The next goal is having enough passive income to cover what I consider to be a more generous version of fixed living expenses so that it includes things like health and personal insurance, kindergarten and swimming lessons for my eldest child. This still isn’t a lifestyle that is going to include a whole lot of fun stuff like eating out or going on holidays, but it’s all the basics covered. I’m estimating that this goal which needs about $30k a year is about another 6 years from being achieved. I guess this is pretty much lean FIRE.
After that I start aiming for having some of the nice stuff covered with the passive income from outside of super and would include money for going to shows or sporting events, eating out once a week or so, giving a bit of money to charity etc. There would potentially be a bit of domestic travel in there as well, but no overseas trips. This would require around $40k a year and should be another 3 years or so on from the previous goal, so 9 years from now all going as planned. I’ll note here that things will almost certainly not go as planned and there will be a blog post on why at some point in the future. (Future HIFIRE here, this is the post I was planning way back when!
My second last goal is having enough to cover all of our current lifestyle living expenses with passive income from outside super. So that’s food on the table, all bills covered, all insurances in place, going to shows and eating out, and going on a decent overseas holiday every year or two. At this point we’d need about $50k a year and would be at what I guess most people would consider FIRE. I’m hoping that this will be another 3 years on, so 12 years from now.
Last but not least, my final goal is having my wife and I both being fully retired and having a high income of around $80k a year for that retirement, whilst continuing to build wealth. This is what generally gets called fat FIRE although I prefer HIFIRE myself. Getting to this stage should allow us to lead a very comfortable life in retirement with plenty of the nicer things in life like eating out, going to shows and sporting events, and lots of big overseas trips.
Happily enough we should actually reach this at the same time as the previous goal. How is this you ask? Well this final goal includes taking into account our superannuation which should have built up to a pretty decent level at that point. There will be a fair few years between actually being retired and being able to access that super so I will need to sell down some assets during that period of time, but the super should be growing at a faster rate than this so on an overall basis we will still be building wealth. Our children will also still be in school at this point in time which will likely limit the amount of extended overseas trips we can do and thus the expense in which case we might not need to sell down assets after all.
So that’s what I’m looking to get to, and hopefully it will mean only another dozen years of working before retiring on a very nice income!
What do you think of these FIRE goals? What are your own FIRE goals? If you liked this post and would like to read more like it then please subscribe using the link on the right!
Glad you shared your goals. $80k per year is our target as well. We’ll see if we need it by conducting a soft test along the way (maybe when we get to 30 or 40k passive income). My wife loves her career and we have no kids, so if I am not working full time we expect that I’ll have more time to cook, make lunches etc as a house husband! (with time to pursue my passions as well)
Enjoying your blog so far 😉
Good to see someone else out there aiming for a high income FIRE! I’m hoping that I won’t actually need that much money but I want to have plenty of room to cut costs if necessary and it’s a hell of a lot easier if there is a lot more money coming in. My wife is a SAHM to our two kids at the moment but hopefully will be back out in the work force part time in 4 or 5 years to help us save even more towards our goals.
Glad you’re enjoying the blog, have you got one I can have a look at?
Young family of 3 in Late 20s, aiming for paid of home in next 5 years. Then 750,000 investments over next 7 years. But once first 100,000 hit will reassess our career paths. I’m working in mining related industry and would like to find a work with passion and purpose to enable a lifetime of enjoying work. Long term would like 1 million but isn’t really a end goal of RE.
Getting that home paid off ASAP will make a big difference over the long term! Once that is smashed out you can get some serious money into investments and hopefully get to do whatever you want to do!
Welcome to the Aussie FIRE blogging community! I’ve really enjoyed poking around a few of your posts, and I’ve enjoyed the more detailed finance angle.
I have approached it a very similar way, with two objectives roughly equating to ‘average FIRE’ ($58k) and ‘FatFire’ ($80k). I have had multiple objectives almost since the start of my journey 15 or so years ago, and even though I iterated them through time, I did find it really motivating reaching more basic objectives more quickly than slogging towards a single immoveable number.
If you haven’t seen already, this is an interesting recent take on the same topic:
https://fi180.com/2017/06/26/the-milestones-of-fi/
Thanks for the warm welcome, particularly the shout out on your own blog! I’m glad you enjoyed the detailed approach, I’ve worked in a lot of different roles in finance so I do plan to do plenty more technical posts.
Looking at your blog you’re almost at your next objective which is great, I would think it would be a fantastic feeling to be at that stage although you’re feeling somewhat nervous I take it? I guess everyone reacts differently.
It may well also be that I continue to break down my own goals into even smaller ones as it can be hard to keep motivated otherwise on a multi year journey.
That link was quite good thanks. It’s an interesting take on FU money, having worked in investment banking FU money was short hand for having enough to retire and live a life of luxury or at least never have to work again and have a reasonable income ie HIFIRE. The version on that blog is just having enough to cover pretty basic living expenses for a year or two which is a very different thing.
Yes, that was the way I had first understood the phrase as well, so I had the same cognitive dissonance. It’s very comforting to read a FIRE blog not predicated on living on $30 000 through various life hacks, will enjoy reading about your journey!
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Are you taking inflation into account for your FIRE numbers? Remember that a target drawdown of 50k per year in today’s dollars, will mean a higher real drawdown in 12 years time when you expect to reach that stage of FIRE.
Yes I’m taking inflation into account for what I want so it’ll end up being more in dollar figures than what I’m talking about here.