Many of us dream of what life would be like as a millionaire.  In their book Quit Like a Millionaire , Kristy Shen and Bryce Leung tell the story of starting dirt poor and eventually retiring millionaires in their 30s.  The book is a cross between a how-to guide and their personal stories that works quite well to keep the reader engaged.  The main criticism is that the authors don’t seem to have realistic ideas about how the stock market is likely to perform, but this doesn’t take away from the practical ideas and motivation to help readers achieve financial independence. The book covers the usual subjects like education, debt, housing, banks, investing, taxes, travel, and retirement, all woven into Shen’s personal story.  She grew up dirt poor in rural China, and after coming to Canada made a series of steps ultimately leading to wealth.  If she can do it, you likely can too, and the authors set out to show you how. It’s common to hear that you should follow yo...

“Whether you think you can, or you think you can't―you're right.” ― Henry Ford Retiring in your 30s or 40s seems like an impossible dream for most people. But the FIRE (Financial Independence Retire Early) movement is filled with people whose goal is to retire well before the usual retirement age. Critics say these FIRE penny-pinchers deprive themselves of any joy in their lives, and that FIRE is impossible for reasonable people. There is some truth to this, but not much. The truth is that most adults have created a life for themselves that makes FIRE impossible without huge changes. They bought a big house far from where they work and own cars for commuting. They’ve committed almost all their income for the foreseeable future to a lifestyle they’ve chosen. No amount of eating in or other penny-pinching will make a big enough change to make FIRE possible. That isn’t to say that smaller changes don’t help. Cutting out small amounts of spending here and there can i...

The hugely popular term FIRE stands for Financial Independence, Retire Early. There are countless articles and blogs devoted to the FIRE movement. But what does FIRE mean? The answer is different from what many would guess. Financial Independence Let’s start with the FI part of FIRE: are those who say they’ve FIREd financially independent? Here’s my definition: You are financially independent if you have enough money or other assets to cover the costs of living the life you want for the rest of your life without having to earn more money along the way. You can be financially independent if you depend on truly passive income such as dividends, capital gains, interest, or a business you own but where you don’t work. However, there should be sufficient margin in your assets and passive income to cover possible market crashes or increased spending needs with reasonably high probability. Based on this definition, few people who have FIREd are financially independent. Some s...