Some Retirement Plans Are On FIRE

Financial Independence - Retire Early. FIRE. It’s a retirement savings plan several young adults are adopting.

The sacrifice is extensive but the payoff even more so, according to Financial Samurai Sam Dogan, who is living the dream.

“I define it as having enough investment income to provide for your best life, without having to work,” Dogan tells KTRH News.

The plan is to work as many jobs as you humanly can, spend as thriftily as you can muster, and invest the majority of your money in assets that will pay dividends in the near and long future. Property that can be leased, for example. Dogan was making about $40,000 a year when he embarked on his retirement goal, living very frugally while investing wisely. “In 2012 my investment income generated about $80,000 a year,” says Dogan, looking back seven years.

The plan is to be able to move away from a paycheck working for someone else to not having to work and letting your investments work for you in roughly 10-15 years’ time. The means of attaining that are not spending. No luxuries. No Starbucks. Get a roommate. No eating out. It’s not an easy life.

Until you’re there.

“Now my wife is a stay at home parent, as am I, and we earn about $200,000 in investment income a year,” says Dogan. For him the realization he needed a better plan began after the market crash in ’08-’09. “The crash really jolted me awake, and I think jolted a lot of people awake to say there is no security in our jobs and our investments could go ‘poof’ in a matter of months that took us years to build,” he adds.

At a time most people struggle month to month with expenses, FIRE is an old “new” idea that is paying off for many.

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