Beyond expense ratios and CAGR; why the intangibles of FIRE may matter more than the quantitative factors. My perspective based on ~8 years of early retirement.

I am submitting this post to promote discussion about what I believe to be potential dangers associated with the pursuit of FIRE and to highlight the importance of, throughout your life, attending to the qualitative factors that I believe are essential to a successful retirement. My goal is to encourage those of you on the road to FIRE to take whatever steps you deem necessary to avoid these potential pitfalls.

I believe that, for some, FIRE becomes some sort of amorphous goal that provides both a degree of hope, as well as an excuse to avoid working on the aspects of life that really matter: social connections, meaningful goals, physical and mental health. This is especially true for people who, while highly intelligent and well educated, are relatively less adept at enhancing and developing the qualitative aspects of life.

Some of you may remember me from my previous posts. Recently I have started to think more about what accounts for post FIRE happiness, meaning, fulfillment and health. I believe that, just as it is important to devote X percent of your salary to an IRA throughout your life, it is equally important to devote X percent of your time to physical and mental health, maintaining or rekindling old friendships and cultivating new ones. Failure to do so puts one at risk for an unfulfilling and unhealthy retirement.

It's as if some FIRE aspirants are saying to themselves: “Yeah, I’m in poor physical health, depressed and socially isolated and I hate my job. But that’s ok, because, one day……”. But then that day comes; you are FI, but with nothing with which to fill the void. I have seen this before. Retirement is often accompanied by a huge let down. Some become depressed and drink. Some stay at home all day, every day leading to friction with their SO. Some blow vast amounts of money on baubles in a vain attempt to find some sort of justification for the decades they had sacrificed to get to this point.

I am eternally thankful to my parents who were wise enough to facilitate and support my nascent hobbies and passions. Because of them I had endless things to motivate me when I stopped working. I am equally aware that my natural tendency to reach out to old friends, work colleagues etc. meant that I had a deep and wide pool of social support when I need it. Nevertheless, I have struggled with periods of loneliness since I stopped working ~8 years ago, long before I had ever heard of FIRE. My new girlfriend has both added tremendously to my life and strengthened my understanding of the vital importance of close interpersonal relationships.

There are lots of young, highly educated people who are generally dissatisfied with the ‘rewards’ of their sacrifices. They are exhausted by meaningless work, narcissistic supervisors, back stabbing colleagues and no identifiable path to a better work life. They are left to ask” “Why the f**k did I sacrifice so much? For this?”

I suspect that, to varying degrees, most of the people who are aspiring to FIRE are life long hard workers who have, throughout life, been rewarded for delaying gratification and have received accolades for their performance.

Unfortunately, this focus on career progress can lead to a self-reinforcing dynamic if you devote so much of your time and resources to work that you never develop hobbies, you become socially isolated and your physical/mental health declines.

I imagine that for more than one reader of this subreddit, your first three decades go something like this: You buckled down in school and got yourself into a solid university. You moved to one city for undergrad, then a different city for your first job…by the time you are 30 you are likely to be living in a city to which you have few ties, far from home, old friends and family and with little in your life other than work. Eventually, you become dissatisfied with this life. If only…..FIRE! You begin to fantasize about the day when things will be ‘different’, and you work ever harder so as to hasten the arrival of FI/RE. This can lead to a dangerous and self reinforcing cycle in which the unrelenting pursuit of FIRE comes with further neglect of the qualitative factors that are playing a significant role in life dissatisfaction.

FIRE is not a panacea that will address all of the root causes of your dissatisfaction. That is a much more complex process. Meaning in life, like financial independence, can be compared to tending an orchard. In both cases is imperative that you nurture your seedlings/trees regularly, over the course of decades and long before you plan to eat the fruit. If you wait until you are hungry, you are in trouble. I know that this is easier said than done, but just as it is important to begin saving and investing early and well before your planned FIRE date, it is equally important to maintain health, social connections and meaningful, non career activities while you are working towards FI.

TL;DR The quantitative aspects of FIRE are arguably less important to a successful retirement than the various, and often neglected, qualitative factors. I believe that many FIRE aspirants are so motivated to attain financial independence that they don’t consider the potential negative consequences of pursuing the quantitative aspects of FIRE (e.g., savings rate, CAGR, etc.) at the expense of what are potentially more important qualitative factors (i.e. relationships, health, etc).