Financial Freedom : FIRE or WATER

F.I.R.E – Need I explain it? Everyone who is interested in reading about personal finance (and hence this blog) is already familiar with the term. In case you do not know, here it is:

Financial Independence Retire Early. 

The concept is very simple, where you accumulate a target amount (net worth) or cash flow, through which you can substitute your working income and retire earlier than usual. 

The main motivation of FIRE enthusiasts for retiring early is to stop working in a 9-5 routine and be able to do what you want, like travel or pursue your hobbies.

However like everything, there are two sides to the Financial Independence coin. One side is retire early as in F.I.R.E, the other is retire slow and enjoy working as long as you can. 

I decided to write this blog post to unravel my thoughts on this.

While the FIRE approach seems lucrative to achieve, there are some disadvantages to that approach.

Similarly the retire slow approach may work well for most people, but it needs to be done with discipline so that as you grow old, the work does not become a necessity to fund liabilities.

With disciplined and good personal finance habits, you can glide into retirement and enjoy the journey as well as the time in retirement. 

Since the first one is called FIRE, metaphorically lets call the second one WATER.

Let me first explain why the first one is more like a FIRE and may have disastrous consequences if not handled properly.

  1. One of the main strategies of achieving FIRE is to earn, save and invest aggressively. Most of the times it means extreme sacrifice (read minimalism) to save 50-70% of the income to reach that magical number.
    • For the family too, the pursuit of FIRE can mean unnecessary sacrifices to not being able to afford (at least artificially) a nice vacation, car, a restaurant meal or even a latte.
  2. I have read and watched some couples on YouTube who are pursuing FIRE. A few characteristics are:
    • They are always looking for deals and the cheapest way to get things done.
    • They are too focused on money, possibly ignoring more important aspects like career growth. For example, a young professional in his/her 20’s, if so focused on earning more will fail to build marketable skills, and will jump from one domain to another as soon as he/she smells more money.
    • Numbers are good, but if every daily action of theirs is dedicated towards achieving that magic number in a bank, I am not sure how enjoyable that journey is.
    • Finally ask yourself: Is that all I am excited about?
  3. Lets say a person reaches his/her number, and now retires early.
    • In the pursuit of money, he/she would not have done what he/she was naturally good at. Imagine if every artist, every scientist, every sportsman just obsessed about financial freedom and retiring early.
    • Once he/she retires, the person would have lost the age and opportunity to work on something really satisfying. In many 9-5 jobs, people are doing great things and achieving life changing experiences for themselves and for others. For example, people working in the high-tech industry who are changing the world everyday should not think about retiring soon.

On the contrary to F.I.R.E, if you work in your field with passion and make the money gradually (making it a secondary factor instead), you would have still achieved F.I.R.E but in the slow and steady way. Disciplined personal finance is neither about aggressively chasing a number nor indulging in unnecessary luxuries.

This slow, steady wealth building and never retire attitude can be compared to WATER. 

Like a body of water – it builds up from a small stream travelling through the river, and then into a mighty ocean, but nature does not let it stop there. The ocean can be considered the final destination, but an ocean never retires. It carries on its work day in and day out, sustaining a diverse form of life and occupying 70% of the earth, controlling huge natural consequences for the planet. That’s the freedom of the ocean.

In this WATER way, you work with all your talents and grow yourself bit by bit everyday. As your talent and experience grows, you achieve big things and gain pride in yourself when you look back. It makes you do more and achieve new goals and heights in your job and business. This is how most entrepreneurs (and intrapreneurs) live their life. They move from 9-5 jobs to opening businesses and do not intend to stop ever. 

There is no retirement in the WATER approach. You keep flowing always like a river, then get into an ocean and still carry on till death stops you.

Note that in this approach, there is no money number and no mention of how you can earn more, negotiate a higher salary and likes. Money will follow as you gain more experience and achievements. 

That does not mean though you should not save and invest. You can still lead a comfortable life and grow your net worth while indulging in meaningful luxuries. It makes the journey much more worthwhile and since there is no hard destination or number, you learn to enjoy the journey more.

The Net worth vs. Cash flow debate

For me, I don’t know if ever I will reach my magic number (I know mine though). Hurrying and worrying about it will not make my life better.

I will rather focus on working hard, learning, managing my money and writing about my experiences and thoughts in this blog. In the process I develop money systems and principles that I like to share. 

Five components of a personal finance system

The Starter Kit

I will hopefully never have to say “I have reached my number, and retired.”

I will keep flowing and see you in the next post. 

nature forest waves trees
Photo by Pixabay on




2 thoughts on “Financial Freedom : FIRE or WATER”

  1. 100% true, can tell you from personal experience. I was intensely set on retiring to escape the “rat race” until I noticed that early retiree’s lives were no better (some got worse) after they retired, even though they claimed to be. I wish I had read and REALIZED this post was true before starting down that path (though, it probably would not have done anything because I had blinders on, haha). Now I never want to retire.

    Liked by 1 person

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