FIRE starter

[Mia85]

This is a thread for discussing FIRE (Financial Independence Retire Early) and supporting each other in planning for the future.

For anyone new to FIRE, the idea is that you live significantly below your income and invest the surplus, usually in low cost funds. The aim is to amass enough that you can live off the returns. At that point you are finanically independent and you are free to spend your time as you wish (which might include working if you want to do that).

There's a huge amount on the internet about it. Lots of news stories e.g. here and here One of the main gurus of the movement is Mr Money Mustache and his website is a good starting point www.mrmoneymustache.com

A lot of the FIRE discussion out there seems to be very US based and/or men in their 20s with no kids trying to retire extremely young so I though it'd be great to talk here and hopefully find likeminded people.

yellow I am so, so sorry. Big hugs to you.

Oh @yellowspanner - this is rotten. Sometimes distraction is good and so Mumsnet can be extra useful. Hugs.

Thank you all. It means a lot even if you are strangers. I think you are like minded strangers.

Re the Budget. I was on the phone to my mother and she said something about "income tax rises by stealth." ..I ignore speculation usually but she was flapping about pensions too so I had a look.

A lot of speculation seems to be based on promises that were made by previous governments for the future. I ignore those anyway though. AFAIC someone saying "by 2023 we will increase the threshold to x" is meaningless. I'll believe it when I see it.

Sorry to hear about your loss yellowspanner.

Wrt side hustles, I've been a matched bettor for the last few years. Currently use a proportion of my 'winnings' to overpay my mortgage each month. If anyone is interested in taking it up I've got a referral
code for profit accumulator you can have!

@AgnesWaterhouse1566, could you tell us roughly how much proxy you make and how many hours you spend on it? Because it’s gambling does that mean it’s tax free?

I’m trying to make as much as I can from side hustles but wary of the tax implications. I understand you can make up to £1k from a hobby, so I count surveys in that, but not selling my stuff as it’s not been purchased to sell on for profit. I don’t think the cashback for food shopping would be taxable either as those are refunds for food items purchased. I know any competition wins aren’t either.

With my holiday let, that we will be paying tax on, when it’s up and running, but it will be kept separate to everything else. I need to get advice on this as to how to manage the taxation as whilst I don’t want to dodge it, I also don’t want to pay too much if I don’t need to. My weekend was spent DIYing in there with DH, I’m knackered but the good weather and FIRE enthusiasm has been very motivating.

I logged on to check my pension payment had made it and my pension is now worth £414 less than I have paid into it, 😳. I know it will go back up, but it’s just a little off to see it fluctuate so much. I’m just not used to seeing so much variation in my accounts.

Fingers crossed for those of us with Premium Bonds as well!

Daschel I average about £500 a month from it although I'm trying to get a bit more time efficient with it as I spend most evenings doing offers (I'm a LP so would rather spend my time making money than watching tv!)

Any money made is classed as gambling winnings so isn't taxable.

Some do make a lot of money from it however the offers have reduced a lot over the last few years, and so it's a bit harder to turn a profit on it. I mainly do casino offers now which is a bit more variable.

Dashel I did not know that about hobbies. I will look into it.

I have Premium Bonds but I don't really know why. I think I thought I might win something.

Like Agnes, I also do MB and make a steady £500 a month tax free from it. It's not a super long-term thing, as the bookies do get wise to you and start restricting your accounts, but I've been doing it for over a year and am £10k up.

Check out the Team Profit website and FB group, there's loads of info on there.

@Effzeh

Like Agnes, I also do MB and make a steady £500 a month tax free from it. It's not a super long-term thing, as the bookies do get wise to you and start restricting your accounts, but I've been doing it for over a year and am £10k up.

Check out the Team Profit website and FB group, there's loads of info on there.

Oh right I wondered how the bookies were allowing this.

£500 per month... Blimey that’s a great monthly (investment?) stash. How many hours does this take?

£500 per month... Blimey that’s a great monthly (investment?) stash. How many hours does this take?

It's quite time-consuming at the beginning when you're learning the process - I started during the first lockdown last year, when work pretty much dried up for me. There are always new offer types to learn, so it can take as much time as you have to spare.

I have a few offers that I do every week, and I know when those need to be done. I have the 'Boosts' thread on the FB page sitting in the background on my computer which sends me alerts during the day if there's something worth doing, which takes about 5 mins each time, a few times a day. on a good day. On a busy weekend I might spend an hour a day in total setting things up?

Some people really hammer it, but it depends how much time you have. And also if you go too hard you're more likely to get restricted quicker. It's not a long-term income replacement, but it's a very nice sideline.

Sorry to load more bad news but it is relevant

I've just heard of the sudden passing of a local man, former neighbour, only knew him to exchange hellos and when I moved, it was ten minutes away so I still saw him en route to the station and waved hello.

He was retiring in April! The person who told me said he was so looking forward to it. He used to make me laugh because if he saw me arriving home he'd punch the air and say "we're home from the wars" 😂

So sad that he missed his retirement. Keep up the FIRE!

Impressive @effzeh

@lunaheather - very sad. Living for now is important as well as saving hard.

Yes, I agree that always and only preparing for a better future, which isn't guaranteed to actually be reached is a mistake. So many people speak of those who didn't make retirement or only had a year within it, at whatever age that retirement was.

There must be some kind of balance of enjoying life now and in the medium term, rather than just sacrificing for some distant point that might not be reached.

And yes, it's true that lots of people can be easily pleased and happy with few material things. I guess we all have to decide what are the things in the here and now that we really love and want to ensure we have now too, as well as preparing for the future and they are different for everyone and cost different amounts.

I'm aiming to stop work at 55. It seems reasonable for me and things will be pretty good then. That 55 point, rather than 45 point has meant that I will have more in retirement and also had more whilst working and saving moderately rather than extremely aggressively. As my kids reach the stage where they will leave home, I've been prepared to spend on some big holidays which we didn't previously have, just because there won't be loads more chances for those. It's worth it for me. Not everyone will choose to do this. Likewise, I could finish work at 45 if Inwas prepared to have a very pared down life after that...but I want more than this will deliver. Other people will value stopping work at 45 more than I do. Being able to plan ahead and choose feels such a luxury and privilege. I know I could have made choices to finish at 45 or to finish at 65. I've been free to choose and have what works for me and my family. I'm very grateful that I had enough money savvy (never heard if FIRE until last year) to be able to see the choices and outcomes early on. So many people are just in a cycle or have no choices which then seem to create even fewer choices.

It is true that you can't take it with you!

I think it's a balance I'm 53 have retired from working from NHS though have my own 30hour a week business run from home ( I'm not expanding it as 30 hours is enough) I used to be very stressed and I get tired easily I get my NHS pension at 60 and have a policy maturing when i'm 55; DH is older next year I will have enough years for full state pension DH already has enough but he doesn't have a private pension though has some savings ,Our aim is for us both to retire completely when DH is 67, though we are not working full whack just now,
Our aim is we just don't spend above £X without being intentional about it and discussing budget; we don't dip into savings easily and never without discussion, we are semi frugal but not tight and we buy quality rather than quantity if we want to eat out we eat out to celebrate whatever and we don't go to cheapest place in town but neither do we eat out just because we have nothing in fridge if I don't feel like cooking there is frozen pizza or whatever or cheese and biscuits. we will downsize when DD finishes school not tiny because DH likes a workshop and i like a craft room and we like folks over for dinner
Often FIRE goes with a little frugality and some minimalism
I think it is about having clear goals financially and otherwise and a budget ( that also allows for the unexpected)

To me fire is about having choices. It's about having enough money that you can do whatever you want. If that's continue working or retire at 45 that is a choice you are able to make. Most people don't have the choice.
I do a lot of voluntary work for a charity, which is fine. I love it and it's part of my hobby.
I spend a lot of money each each travelling (at least I did before Covid and before DP became ill).
I fully intend to travel again..to remote places where the diving is good.
But I wouldn't buy more things no matter how much money I had.
FL brings independence and choice as far as I am concerned.

Yes to choices and balance...

This week’s FIRE action is to transfer my stocks & shares ISA to a cheaper provider. Nutmeg is 0.98% fee wise. Can’t help noticing that Vanguard is 0.23 or similar. The NUTMEG’s performance has been average to poor whilst my other half’s ‘MoneyFarm’ ISA has performed very well in the same timeframe. Not sure on fees though...

@yellowspanner - your volunteering, travel and diving plan sounds wonderful!

I don't have S&S ISA.

How quickly can you sell/ cash in? Thanks.

@LunaHeather Vanguard says up to 7 working days as you need to sell your investments and then withdraw the cash

www.vanguardinvestor.co.uk/need-help/answer/how-do-i-make-a-withdrawal

@yellowspanner I love to dive too. It’s not what you call a frugal hobby is it? Unless you are a free diver and they are amazing!

With regards to choice, I would love to see more people think that just because they earn X they need to spend X and when they get a pay rise they can spend that too and so the houses and cars get more expensive, the number of takeaways goes up, the supermarket gets upgraded and the clothes get more expensive and the entertainment budget goes up.

Everyone has a different solution as to what works for them granted, but saving for whatever life goal you have, has to be better than getting an extra takeaway a month, a Sky upgrade and going from Tesco to Waitrose.

Thank you Dashel

So the value would be at the point you declared intention to sell?

Maybe instead of transferring an old ISA to the princely interest of 0.5, !!!

I should look at S&S ISA instead.

@dashel- agree that your expenses creep up when you are aware of a pay increase... it takes discipline to maintain similar outgoings. I’ve not always had that discipline...

@LunaHeather yes, the value will be when you sell it, it’s a bit strange to me, the fluctuation of my pension and this ISA - at least when my documents have been verified and I can invest.

Interest rates are shocking at the moment, it seems like it’s worth trying something new.

@PensionsYes I haven’t always been super frugal, but I have never had a new car, or paid more than £3100 for one. That seems to be an area I know a lot of people spend a lot on.

@LunaHeather - interest rates are really poor... especially in comparison to my S&SISA performance.

0.5% in Marcus for example is hopeless also when you compare it to inflation...

I don’t know how advisable it’s good to hold cash for with such low interest rates. I wonder if the new NS&I green bonds might offer something better?