The F.I.R.E. movement is all about achieving financial independence quickly and retiring early (as normal the actual “retire early” part is not a mandate, just an option if you would like to). If you have not read other posts, or blogs, or books about the F.I.R.E movement, this post will still be helpful but you may want to start with some of the posts that discuss the basics of F.I.R.E. If you are already here and are like, “Screw it, I’ll just read it anyway”, more power to you. If you are one of the readers that has already consumed much of the F.I.R.E knowledge, this post is a quick consolidation of the pillars or fundamentals that everyone can (and maybe should) be doing to go from 0 to 100 on their Financial independence trajectory.

I want you to have a something super basic to look at, almost like a checklist, to make sure you are doing everything in your power to maximize your likelihood of being financially independent, FAST! That is what this post (Part 1) is for. For a getting to financially independent fast analogy, I want you to go from the average American middle school gym class mile times to at least the mediocre college kid track team mile runner. If you can go straight up to Olympic qualifier or champion mile runner, that is even cooler. But for most people that might be a little bit too much. Still, in this analogy, if you are a college track kid conditioned mile runner, you are running laps around most Americans (figuratively and literally). But how does one get to be financially free faster than the average-Joe? These pillars/fundamentals will help.

Side note, as I mentioned above, this is going to be part one of the series. I am just going to go over the outline of focus areas here, and then in part 2, onward, we will deep dive a little more. These fundamentals are not ground-breaking, but doing them all together will not only create far more income for you to keep and invest, it will also allow you to live a simpler, less stressful life. The point here? Cut expenses and create more income so you can invest more and retire in your 30s, 40s, or 50s, instead of working 40 years or more of your life.

The Fundamental steps of F.I.R.E (outlined) are:

1. Cut Your Unnecessary Spending Costs – To be simple here, most of us spend too much money on stuff. Sometimes this is out of laziness to change. Sometimes it is out of lack of knowledge. Sometimes there is a mental block that says “Wait, I can’t do that. What will people think?”. Just for a heads up though, people don’t think about how much stuff you own unless they think you own too much. So don’t worry about all of a sudden being smart with your money. Either way, some of the major areas of savings that are discussed in F.I.R.E to get to financial independence fast are:
   • TV subscriptions/cable – I hope you are not paying for cable still, that is so 2006. Save yourself the money and put it towards something better (like not having to work as much anymore). If you are an avid subscription/streaming person, I hate to blow your mind, but you don’t need four streaming services at once. Choose one until you are done watching what you want, cancel it, and move to another one for a while .
   • Phone Plans – Did you know you can pay like 300% to 400% less for your phone plan? I sure you do (don’t tell me your wandering eyes didn’t notice the sexy Ryan Reynolds in the Mint commercials), but hopefully this helps you actually look into it more. Find the discount phone plan carriers in your area and stop by to check them out.
   • Food Costs – The average middle income American household spends almost $750 a month on food (Link to USDA website). Guys, what the crap? For a 3-person household, that would be an average of $8 a meal per person (31 day month) and means you are eating out waayyyyy to much. Want to retire quickly? Keep your average, per person meal costs to between $1.50 to $2.50 and you will save yourself thousands, even with a few splurge nights thrown in.
   • Housing Costs – For most people, the biggest expense item is housing. Things such as focusing on locations that are less expensive, learning about house-hacking, and being intentional of your housing cost-to-income ratio can lead to dramatic increases in your speed to financial freedom. The savings discussed above on phone plans, food costs, etc. may save you $100 to $300 a month, each. Saving on your housing (especially with house-hacking) could save you $500 to $1000 a month pretty easily. So, this is an important focal point for us all (not that the others are not).
   • Vehicle Costs – Man I have an internal hatred with the vehicle costs people pay. Did you know that the average new car payment is over $700 a month? That may have come down a little with inflation coming down some, but still. Even average used car payments show as over $500 a month. That means many two driver households are paying $1000 to $1400 a month in car payments (not including gas, insurance, repairs, and maintenance). Want to know how much I pay a month? $0. You can (and should) to.
   • Recap – just to make sure you understand this section, if you followed each of these savings areas (I’ll show you how in later posts), you could potentially save somewhere around $1500 a month or more. Even if you only did that for 10 years of your life, and invested that savings (which is the key) with a 6% rate of return, you would have built over $240,000 in investment assets. Obviously if you do it for longer than 10 years, you will see more significant growth.
2. Cut Your Interest Costs – For simple explanation, get rid of debt. You likely cannot get rid of a mortgage ultra fast, but if you save yourself money in these areas discussed above and below, and apply the savings towards your debt, you can get rid of every other interest cost, in haste. Debt can slow your progress massively. Get out of debt and do it fast.
3. Cut Your Investment Costs – What the financial world doesn’t want you to know is that you, very possibly, are paying huge amounts in fees on your investments (unless you are savvy to ways of the financial world). One of the easiest things you can do is lower your investment costs to improve your investment returns and get to financial freedom faster. This, no joke, can likely save you HUNDREDS OF THOUSANDS over your investing life.
4. GET ALL YOUR FREE MONEY – Shockingly, many people still don’t utilize all the free money they are offered by their employer via HSAs, 401ks, and so on. Don’t leave free money on the table, especially when it can be invested and make you more, free money.
5. Increase Your Income – Another way to improve your time frames to financial independence is by increasing your income (and not increasing your expenses along with it, of course). If you can do a side hustle, or create a promotional opportunity, and also cut many of these expenses discussed here, you can create a much larger sum of money to invest every month. This is like adding nitrous oxide to your street racer in Fast and The Furious.
6. Focus on Your Savings Rate – You have noticed that I have mentioned “investing the difference” numerous times already. This is a massive key to your understanding of how fast you can reach financial independence. A key factor in your fixation on being free should be your “savings rate”, or the percentage of your income that is being invested.
7. Cut Your Current and Future Tax Costs – Wow, taxes are so much more important of a cost in your budget than most people think. If you know how to focus on lowering your tax bill, you can get laps a head (back to the mile running reference, just for good measure) in record time.
8. Cut Your Travel Costs – Whether you just love to travel or you have to travel (because family is a long ways away, etc.), travel costs can be huge budget killers. If you know how to successfully navigate this part of your expenses, you can not only save yourself a ton of money, you can make travel more enjoyable.
9. Learn Constantly and Track Your Growth– This should be simple. Read and learn more about personal finances so you can improve your finances faster. And track your numbers at least quarterly (I recommend monthly) so you know how close you are to your goals.

To simplify these fundamentals, let me give you a synopsis.

Increase more of these:

Your mindset and tracking, your income, your savings and saving’s rate, and your net worth.

Decrease more of these:

Your debts, your unneeded/lazy monthly expenses, your investment fees, and your effective tax rate.

Alright. This, again, is not the tips on how to move forward with the action items, but merely an outline on some of the biggest focal points in our discussions of fundamentals and pillars on the road to F.I.R.E. I am going to include a few other posts to read to help you understand the importance of saving money in these areas before we go into each of the pieces in more detail. Do not take these pieces lightly. Small changes can create huge impacts and I want you to enjoy your freedom before you are too old to enjoy it fully.

Check out some of these posts and move on to part 2.

Part 2