By: Nadia Busseuil
The movement is gaining popularity, but the news still hasn’t reached the majority of women. F.I.R.E. is an acronym that stands for Financial Independence Retire Early. Even if retiring early is not your main agenda, the premise of F.I.R.E. can help many women improve their lives financially.
How Much Do You Need?
One of the first questions when it comes to is wrapping your mind around how much money it would take to retire early.
Instead of trying to answer such an intimidating question, start small. Ask yourself the following:
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How much money do I need to stop living check to check?
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How much money do I need in order to have all of my bills paid on time and emergency savings that covers 6-9 months of expenses?
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How can I lower my expenses?
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How can I create passive income to replace the money I currently make from my job?
When you ask and answer these questions in this order, you are creating a map to reach financial independence. Once you reach financial independence, you can then choose if and when you want to retire.
No matter if you make $30k or $300k a year, the same questions and principles apply. Being honest with these answers and hitting these milestones, can put anyone on the path to Financial Independence regardless of income.
Supercharging Your Path to Independence
Relying solely on your savings and lowered expenses to reach financial independence can be done, but it takes a long time.
Additionally, given the low interest rates that are paid on most savings accounts, you have to factor in the opportunity costs of keeping the bulk of your money in those accounts.
Your money can grow faster in other vehicles such as stocks, ETFs, and index funds.
Investing your money can act as a turbo booster on your path and cut the time it takes to reach financial independence.
Despite the volatility of the stock market, it is still one of the best places to put your money for future growth.
Check out this article from FINRA which gives you more of an idea of the risks and rewards of long term stock market investing.
Additionally, competition to gain new investors as clients has never been tougher for investment brokers. These are the middle men that you need to get into the marketplace to buy stocks a.k.a the stock market.
Investment brokers are now offering new investors the capability to enter the stock market with the lowest barriers ever. You can now trade in the stock market without paying any fees and have access to a wide variety of investments vehicles.
If you are worried about risking a lot of money, because you are new to investing, you can start out small with fractional shares.
Fractional share investing allows you to invest as little as $1-$5 dollars into the top 500 companies in the United States.
Using fractional shares, you can become comfortable with trading. What’s more, if you purchase dividend stocks, you can start earning passive income money just for holding shares in that company.
Time is your friend when it comes to investing so there is no time like the present to start!
If you want to learn more about fractional shares and how to begin purchasing them, this article we created on fractional shares walks you through step by step.
Start Early and Stay Consistent
For most people, financial independence may seem like a lofty goal. However, if you start early and stay consistent you can reach it without much of a struggle.
The earlier you start, the more time your money has to work for you. If you are starting later in life, use tax free accounts to help you catch up.
Additionally, even if you do not want to retire early , just answering the questions to get there will make you more aware of your finances and how to better use your money.
The bi-product is that you will at least be financially comfortable and maybe even financially free!
Either way, F.I.R.E. has the potential to change the lives of many women and families to disrupt the financial inequalities that now exist.
Nadia Busseuil is an entrepreneur, investor, and partner at www.wealthtwins.com. She’s from New York City and holds a B.A from Columbia University and worked 13+ years in Investment Banking and Financial Services. She reached Financial Independence in her 30’s and is passionate about showing others how to achieve the same.
