People don’t like to be told they can’t have it all. It’s one of the reasons frugality as a way of life is a hard sell.

Enter the followers of the FIRE movement, which stands for financial independence, retire early. They advocate a frugal lifestyle in an effort to save 40 to 50 percent of their income or more.

Admittedly, those of us in the personal finance media are obsessed with FIRE people. Their life stories make for compelling reading and often elicit such questions as, “How does she do that?”

It certainly was my reaction to a recent Wall Street Journal article: The New Retirement Plan: Save Almost Everything, Spend Virtually Nothing

The article features a 38-year-old Seattle lawyer who wants to retire at 40 with $2 million, and she’s well on her way. To accomplish this, she’s saving 70 percent of her $100,000 net income. She buys brown bananas, walks to work and borrows Netflix passwords from friends. Oh, and she’s single with no children.

Such stories do not endear people to the FIRE movement. It’s too extreme and unrealistic for many. And that’s a problem because it makes it seem as though financial independence and/or early retirement for the masses is an unobtainable goal — a pipe dream. It makes people who are able to save only 10 or 15 percent of their income, if they’re fortunate, feel like a financial failure.

But the superstar members of FIRE also don’t quite capture the essence of what the movement is trying to do, which is to encourage people to live on less so that they don’t have to work themselves to death.

You may want to work into your 70s, 80s and even 90s, but a lot of folks don’t. They want to have command of their lives. They are looking forward to several decades of doing what they want, when they want.

Of course, the reality is that many people aren’t saving anything or nearly enough to retire at 65, let alone quit working in their 30s or 40s. So, I applaud a movement that inspires individuals to at least try to cut back on their expenses, not sink so much money into a depreciating asset like a car or tether themselves to a mortgage they have to take into retirement.

If FIRE is going to gain traction with the general population, its image has to include more than folks living extremely frugal lifestyles. To that end, TD Ameritrade had Harris Poll conduct a survey of 1,500 U.S. adults ages 45 and older with at least $250,000 in investable assets. The goal was to clear up misconceptions about FIRE.

“Despite its buzz-worthiness and recent media coverage, two-thirds of Americans surveyed have never heard of FIRE,” JJ Kinahan, chief market strategist for TD Ameritrade, said in releasing the results of its survey. “So we think it’s important to help consumers understand what it is, and more importantly, what it isn’t.”

Here are three common misconceptions the survey by TD Ameritrade debunked.

Myth: FIRE is all about quitting work and retiring early.

The reality: Seventy-five percent of financially independent respondents said financial security is more important than retiring early. Only 35 percent said they were motivated by the prospect of leaving a 40-hour-a-week job. People said they were just looking for work-life balance.

Myth: FIRE means extreme frugality

The reality: The majority of financially independent survey respondents (67 percent) said FIRE isn’t worth it if they have to live as though they’re broke. When asked what they were willing to give up, 40 percent said they would limit travel or going on a vacation. In fact, when compared with folks who hadn’t achieved financial independence, FIRE folks had similar responses about what they weren’t willing to sacrifice.

Myth: FIRE means living lean in retirement

The reality: Sixty-eight percent said they would rather retire at a normal time than retire early and live a low-cost lifestyle in retirement.

This survey found that people didn’t have to live to the extreme to save more in a quest for financial independence and the goal of retiring on their terms — early or late. FIRE followers, many who start aggressively saving and investing in their 30s, understand the power of compounding. They are proving that if you give up some things now, you can achieve financial independence.

But even if you can’t cut and save your way to retire early, the principles of the movement will at the very least set you up for a more financially secure retirement when you do stop working.

Read more:

Your Thoughts

Let’s continue this conversation. How much more could you cut your budget to join the FIRE movement? Send your comments to Please include your name, city and state. Put “FIRE” in the subject line.

Retirement Rants and Raves

I’m interested in your experiences and concerns about retirement and aging. What do you like about retirement? What came as a surprise?

If you haven’t retired yet, what concerns you financially?

You can rant or rave. This space is yours. It’s a chance for you to express what’s on your mind. Send your comments to Please include your name, city and state. Put “Retirement Rants and Raves” in the subject line.

In the past several weeks, readers have been sharing their concerns about long-term care. I share them not to scare you but to highlight how families are coping and the challenges they face.

Karen Carroll of Virginia wrote, “We currently have a long-term care policy for my husband, age 67. His family history and current medical condition would indicate that he might need it at some point, and, selfishly, I don’t want to be bankrupted by his care if I outlive him, which I expect to do. I am 60, in excellent health; my mother is 88 and going strong; and my grandfather was 94 when he died. At this point I have no LTC insurance. We can’t afford the premiums for both my husband and for me.”

“I am 66, plan on drawing Social Security when I’m 70,” wrote Eva of Centreville, Va. “While I have no appreciable retirement savings, the $3,000 per month I will get from Social Security will provide 70 percent of my current take home pay. I don’t see myself ever retiring from working. I may quit my current, full-time job and pursue something fun part time, which will probably make up the difference without needing a change in my lifestyle. I do plan on moving to a warmer climate (i.e., North Carolina or Georgia) where it’s cheaper to live than Virginia. My car will be paid off, and I will have no credit card debt, so I’m pretty optimistic about my future as an old lady. Fingers crossed that health stays the same (good).”

Judy Dunkley of Glen Ridge, N.J., wrote, “I’ve spent the last several years dealing with the cost of long-term care. My stepfather developed sudden onset dementia in early 2012. He had been caring for my mother, who was diagnosed with Alzheimer’s in 2010. Panicked, I called the Alzheimer’s Association, which not only took time to explain my options but sent me a package with all kinds of information, including assisted living facilities in my area that had secure memory care units. Fortunately, my stepfather was a prudent man who had saved up in case his wife needed care. Instead, his entire saving was spent on his own care, which included two years of assisted living, numerous hospitalizations, multiple stints in rehab facilities, and finally a nursing home. By the time he passed I was literally one month from having to apply for Medicaid because his funds were about to run out. It was an extremely stressful time. My mother would not allow anyone in the house to help her, so I was left to run between her house and whatever facility my stepfather was in, shop for my mom, clean her house, cook for her, and take her to the doctor when she would allow it, all while juggling a full-time job and a family of my own that includes a special-needs child.”

“This is my main worry: what to do if I can’t care for myself and my husband,” wrote Esther from California. “I’m 80. So here’s my plan. My only asset is my duplex owned free and clear. I will have a caregiver live in what is now the rental unit, get a reverse mortgage for expenses. We have no children, so no help there. Of course if we get dementia, all bets are off. The whole thing is scary.”

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