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There’s a debate raging about how much it really takes to retire early.

On one side there’s personal finance guru Suze Orman, who cautions that retiring early without a significant nest egg could crack early retirement plans.

And then there are members of the FIRE movement who aspire to retire early.

In case you don’t know, FIRE stands for “Financial Independence, Retire Early.” It’s a community of folks who say you can retire in your 30s by living on far less than you earn and investing what you don’t spend.

If you’re willing to commit to extreme frugality, you don’t have to wait until 65 to retire, members of the movement say.

FIRE got a jolt of attention after comments made by Orman, the New York Times best-selling personal finance author who made her millions coaching others how to save and spend less. She was the host of her own show on CNBC.

Orman poked her nose out of retirement, where she’s living on a private island, to comment on the FIRE.

“I hate it. I hate it. I hate it,” Orman said during the Afford Anything podcast.

Tell us what you really think, Suze.

She was concerned early retirees wouldn’t be adequately prepared for the long haul should the economy tank or they get sick. Here’s part of the transcript of the podcast with blogger Paula Pant.

Orman: “Listen everybody, I know you want to retire at 25, at 30 and 35, but here’s the problem as I speak to you at 67 years of age, approaching 70. As you get older, things happen. Not only do things happen as you get older, things happen when you are younger. You’re hit by a car. You fall down on the ice. You get sick. You get cancer. Things happen. . . If you have $20, $30, $50 or $100 million, be like me, okay? If you have that kind of money, and you want to retire, fine.”

She goes on to say having a “few hundred thousand dollars, or a million, or $2 million” won’t be enough. "If a catastrophe happens, if something goes wrong, what are you going to do?”

Orman says early retirees should be worried about the financial stability of Social Security and Medicare, the possibility of higher taxes and the ever-growing federal deficit.

Here’s a legitimate point from Orman: “If you’ve achieved financial independence, and you’re no longer now putting money into your retirement accounts, you are losing the compounding years of your life. . . So now you’re living off of the money that you have. How do you take advantage of your compounding years?”

Pant: "What would be a safe amount at which a person can say, 'Alright, at this point, given the size of my portfolio, I’m comfortable enough that if I did get hit by a bus, I would be fine.”

Orman: “It would have to be in the millions . . . You need at least $5 million, $6 million.” (She later says $10 million to account for taxes.)

FIRE proponents fired back at Orman that she has it all wrong.

Their goal isn’t to stop working, but to live a better life doing what makes them happy.

And Orman may have lost some perspective with her megamillions, living a lavish life that is far above the standard of the average American. She talked, for instance, about spending $30,000 a month to care for her mother.

My father-in-law was in a really nice assisted-living facility and the cost was about $3,500 a month.

There is a middle ground here folks in which you don’t need $5 million to retire early.

An early retirement is doable. Here’s how.

What I like about the FIRE movement is there are people who have come to understand they don’t need as much as the advertisers say they need. They are deciding to live their best life on less. And if they are successful they let their money work for them so they can work or live as they please.

“We have low and easily controlled expenses,” wrote Mr. Money Mustache, who retired at 30 and is a leading advocate of the FIRE movement. “Remember, we got here precisely by being good at controlling our spending. Instead of focusing your energy on leasing BMWs or dressing yourself up fancy, you have learned to live happily and work on your skills, health and friendships. It’s a package that will make you wealthier in good times and bad.”

Retire early or keep on working? How to prepare for either choice.

Orman backed off a bit from her criticism of the FIRE, writing for Money, “If you want to retire from a long commute, a corporate hierarchy you loathe and work that you don’t look forward to, I am 100 percent cheering you on. But that assumes your next goal is to segue into a new ‘career’ that speaks to you, and that yes, brings in some money.”

But let’s also put this debate in perspective.

Many people aren’t saving enough to retire at all – early or late.

Read more:

Retire early or keep working? How to prepare for either choice.

Is $1 million enough to retire? Why this benchmark is both real and unrealistic.

Should we retire the concept of retirement?

Color of Money question of the week

What do you think of the FIRE movement? Are you a devotee? Send your comments to colorofmoney@washpost.com. Please include your name, city and state. In the subject line put “FIRE.”

Live chat today

Let’s talk about your money. I’m live at noon (ET) today to take your personal finance questions.

My guest this week is Mark Kantrowitz, publisher and vice president of research for Savingforcollege.com. We’ll be talking about 529 college savings plans.

Read more: The average 529 college savings account hits a record high. But it’s still not enough.

It’s also “Testimony Thursday” so share with me your success stories. Have you paid off debt? Did you finally reach your emergency fund goal?

To join the live discussion click this link.

Stock market losses

The stock market is still turbulent and keeping some folks up at night.

Last week I asked: How are you coping with the recent stock market seesaw?

“I keep reading different gloom and doom stories, and then there are the ones saying this economy is so strong,” wrote Dave. “Didn't we have banks too big to fail, but failed anyway? It's easy to ignore this volatility if you have many years to go, but when you're thinking about retirement, dropping $20,000 is not ideal for your plans.”

Read more: Dow plunges more than 600 points in another day of losses, officially wiping out its 2018 gains

G. Lukos of Beaverton, Ore., has some advice on handling a day of big stock market losses: “Turn off the news. Since you have already set up your portfolio with an asset allocation appropriate for your personal situation (in my case, in retirement) you have done what you can to handle inevitable market gyrations. Don’t react after the fact. Prepare ahead of time.”

Don Barrett of Arlington, Va,. wrote, “The big problem is that the average investor has no idea how to manage risk. For example, using risk management strategies such as trailing stops to get out before the losses become devastating, position sizing to ensure that the risk is evenly spread among asset classes, and planned asset allocation among uncorrelated assets to ensure diversification, can help ensure that one has the funds to continue through the rough times to achieve success.”

The investment strategies Barrett suggest are probably way over the heads of a lot of investors. But if you’re interested in finding out what he means, read the following.

-- How to Use Trailing Stops

-- What is ‘Position Sizing’

-- Correlated and Non-Correlated Assets: Learn About Why Asset Correlation Matters

Color of Money Columns This Week

Knowledge isn’t power. The right knowledge is power.

Stay informed about your money.

In addition to this newsletter, please read and share my weekly personal finance columns.

-- You didn’t win the Mega Millions? Good.

-- Here’s one way to cut the cost of college

Newsletter Comments Policy

Please note it is my personal policy to identify readers who respond to questions I ask in my newsletters. I find it encourages thoughtful and civil conversation. I want my newsletters to be a safe place to express your opinion. On sensitive matters or upon request, I’m happy to include just your first name and/or last initial. But I prefer not to post anonymous comments (I do make exceptions when I’m asking questions that might reveal sensitive information or cause conflict.)

Have a question about your finances? Michelle Singletary has a weekly live chat every Thursday at noon where she discusses financial dilemmas with readers. You can also write to Michelle directly by sending an email to michelle.singletary@washpost.com. Personal responses may not be possible, and comments or questions may be used in a future column, with the writer’s name, unless otherwise requested.

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