An introduction to Fear FIRE

What is fear FIRE?

FearFIRE is a type of Financial Independence Retire Early (FIRE), first coined here.  FearFIRE is having a large enough amount of money to retire early but being too afraid to pull the trigger and retire.  It has some things in common with the other types of FIRE, but the difference is that you have the money for FatFIRE, LeanFIRE, BaristaFIRE, or CoastFIRE, and you’re just too afraid to use the value that money provides to change your life.  FearFIRE could also be referred to as FearfulFI or FearfulFIRE.

There are many different types of FIRE:

There are many types of financial independence or FIRE approaches out there.  And you certainly don’t need to have a specific “type” or name on your financial independence goal to succeed. Still, I think it can be a fun and helpful way to keep you motivated on the journey towards a goal.  Naming your approach can also help you associate with communities of like-minded people.

If you’re less familiar with the different types of FIRE out there, one of my favorite summaries of the FIRE movement and the types of FIRE out there is on the Fioneers blog.  They do a great job of summarizing Lean FIRE, Fat FIRE, Coast FI, Barista FI, Slow FI, and more!  I never personally related to these types of financial independence, as I was dealing with a different set of circumstances and limiting beliefs.  This is what led me to put a name on my feelings, and in the end, that name was fear.  I’ve decided to coin a new term and a new type of financial independence in the spirit of naming things.

The main differences between Fear FIRE other types of FIRE:

• FearFIRE is not a destination; it’s a state of mind. And it’s not a great state of mind to sit in, but like many things, pushing past it can feel very good, and you can learn a lot from the journey.
• FearFIRE is not something you should be purposefully striving for. It’s something that may exist, and if it does, you should be actively working to push past it.  I’ve included some ideas below for starting the journey to push past fear.
• FearFIRE is a phase or stage on your broader financial independence journey. Let’s call it a pit stop.  You may find yourself there for a short or long period, perhaps more than once.  The goal, in the end, is to move past this stage and get to the other parts of this journey.  Below are many thoughts on how to push past this pit stop.   

How do you know if you have Fear FIRE?

• You’ve done the math, you know you have enough, yet you’re still not able to take the plunge. Fear may not be the reason that you’re not willing to take the plunge into early retirement, but it also could be.  Yes, it could instead be that you enjoy your job, and it’s not limiting any of the other things you want to be able to do with your life.
• You’ve diagnosed yourself with the one more year syndrome. One more year syndrome is the idea that you want to retire and you’re financially ready, but you’re not willing to take the plunge, and you keep thing I’ll work “one more year.”  And that one more year can quickly turn into five years or ten years.  It has some similarities to FearFIRE, as they are likely both rooted in some level of fear.  You might keep thinking that you want to work “one more year” because you’re afraid you won’t have enough money, you’re not sure what you’ll do after retirement, or you’re scared to leave the community and relationships you’ve built at work.
• You’ve diagnosed yourself with the bag lady syndrome. And yes, bag lady syndrome is a real thing.  The term was first coined in the 1970s, but I first learned about it when I read The Bag Lady Papers over a decade ago.  It finally put a name to a feeling I had since I started making real money after college.  One of the many reasons I was frugal was that I constantly felt like I needed to “save for a rainy day.”  I constantly felt like no matter how successful I was, it could all disappear overnight.  There’s a great book titled “The Bag Lady Papers: The Priceless Experience of Losing It All” by Alexandra Penney.  I recommend you read the book, but the quick story is that a woman worked hard, became very successful, and then lost almost her entire life savings after investing with Bernie Madoff.  It’s my worst fear come true.  But then, when I think about it, it’s not my worst fear.  My worst fear is more something life or death; it’s losing a child, losing my husband, or getting sick myself and not being able to see my children grow up.  And a reminder of my actual fears helps alleviate other fears like my own bag lady fears.

9 tips for overcoming Fear FIRE and moving into a new phase of FIRE:

1. Be kind to yourself and accept that fear is a normal part of this process. First off, you should be kind to yourself and remember that it’s normal to have moments of doubt and fear.  And it’s even more normal when you’re on a unique journey and path in life.  If you’re striving for FIRE or financial independence of any kind, then you’ve chosen to take the road less traveled.  And when you choose the road less traveled, it’s pretty much expected you should have some fear.  Fear comes with new and unchartered territory.  Yes, you can go online and find tons of other people on the FIRE path, but it’s less common to find them as your neighbor, in parents at your children’s school, or within your community.  And with that less common path comes more fear of change and the unknown.  If you accept this as a normal and expected feeling and are kind to yourself in the emotions you’re having, then you will feel better about it.
2. Remember that courage isn’t the absence of fear but is instead the ability to push through your fears. To be resolute in your path to early retirement, you don’t need to strive for a total absence of fear or doubt; you need to have the courage to stay on the path despite these doubts.  You will hit many inflection and reflection points along the way; feel the feels during these points and know that it will take courage to continue your journey.  Dig deep and find your inner courage.  Many of the following steps will help you find that courage.
3. Read and listen. The more you learn about personal finance, the more educated and confident you will feel on this path.  Don’t just read one book and think that’s going to cut it; read or listen to lots of books, listen to different podcasts, read a bunch of blogs, and watch a ton of YouTube videos.  There are so many high-quality and free resources out there; there is something for everyone!  If you’re not vibing with a specific type of content, that’s cool; put it down and look for something else.  I feel like there’s an overwhelming amount of content out in the world, so you must be selective to choose the content that works for you.  Here are a handful of my favorite personal finance books.
4. Know your numbers. I highly recommend you track your net worth and track your monthly expenses.  These are two of the most powerful things you can do to improve your finances and propel you on your path towards early retirement or financial independence.  Yes, it can be a tedious activity if you don’t love google sheets or excel, but it’s so powerful.  I encourage you to push past the tedious nature of it and commit to doing it for some time.  What gets measured gets better.  And aside from measuring things making them better, the knowledge of knowing your numbers brings power with it.  Knowledge brings power, and in this case, it brings the power of having confidence in what your numbers are and how you’re going to fund your FIRE goals.
5. Write down all the things you’re afraid of. Though I’ve never been able to stick with journaling personally, I do believe there’s value in putting pen to paper and writing things down.  Take some time to write down all the things you’re afraid of.  My list is long if I let myself write them all out.  Some things are simple (e.g., medical insurance), and some are more complex and harder to put into words (e.g., my identity and ego tied to work).  Do your best to write out all your fears.  At the very least, it’s cathartic to get it down on paper.  And if you want to go a step further, you can rank-order them, prioritize them, or group or organize them in some way.
6. Calculate your fears. This may sound a little funny, but I suggest you put numbers against your fears.  After you’ve written down all the things you are afraid of, put an actual dollar amount next to the items where you can.  Not everything will make sense to put a dollar amount next to, but many will.  Some of my financial fears that I’ve been able to put dollar amounts next to include: to cost of health insurance, unexpected medical costs for ourselves or our parents, that I’m going to want and need to spend more on travel than I’ve estimated, unexpected car trouble, unexpected housing expenses, or that college or other kids’ activities cost way more than I expected.  And when I did an exercise to put worst-case scenario numbers against all of these, they totaled about $1M, and I was being very generous in my estimates too, so this was genuinely worst-case.  The value in putting numbers against these things, whether large or small, is that it reminds you that you can deal with them if they come up.  Many of them will never happen, but some of them might.  You can prepare in advance for them by working one or two years longer, or you can deal with them as they come and decide to go back to work part-time or get a new job when the time comes.  The point is that you have options.
7. One very tactical way to dissuade your FearFIRE is to ensure you’re well-diversified.  Diversification minimizes your risk, and minimizing risk can reduce fear.  If 100% of your life savings is invested with Bernie Madoff, well then, you’re not diversified because if something goes wrong with this single person’s decisions, you’re in a jam.  But if your lifetime of assets is instead diversified across a mix of real estate, domestic stocks, foreign stocks, bonds, and cash, then you’re most likely in a much better position.  You could say the same thing about diversifying your income streams so that if one is impacted, you still have some level of income remaining.
8. Remind yourself how resilient you are. To help alleviate all of the fears mentioned above, it can help to remind yourself of your resiliency and, more specifically, your future earning potential.  If you decide to retire early, it doesn’t mean you can never “go back” and find a way to make money again.  I am personally in the process of retiring early from a 20-year career in Corporate America, and with that comes all sorts of emotions and fears.  I always try to remind myself that I have strong earning potential, whether in small or large ways.  I could go back and get the sort of job I have now and earn more money, or I could get a part-time job or more transactional job (e.g., working at Starbucks) if I truly needed to deal with an emergency or something unexpected.  I can earn money if and when I need to.  If you’re reading this blog right now, I would guess you also have that capability, and it’s an important thing to remind yourself.
9. Leverage the power of community. Surround yourself with like-minded people who positively motivate you and spend less time with those who don’t.  This has been huge for me; I’ve seen and experienced the benefits.  Every single person I have interviewed on our friends on FIRE podcast, met at a conference, or talked to on Instagram has helped me in some way, either small or large.  They have helped to dissuade my fears, and they have helped to encourage me to forge ahead towards my dreams and goals.  Do not underestimate the power of community.  Community is often-times free, and it’s incredibly powerful.  You get to make choices every day on whom you spend your time with, whom you surround yourself with, and what social media influences you allow in your life.  Make good choices and build a community to support you and fight down your fears!

Moving away from Fear FIRE into a place of trust and love

If you are experiencing FearFIRE as I have, I hope it’s only a brief stop on your more significant journey.  It’s normal to be afraid of change.  Our brains are wired to associate change with the unknown and to react with feelings of caution and fear.  And people want to be in control, which is a common expression of fear.  On the flip side, someone with no fear could be reckless.  So, fear can play a good role in our lives.  I’m afraid of getting burned by boiling water, so I would never stick my hand inside a boiling pot of water; it’s good my brain is wired this way.  This wiring stops us from doing irresponsible things.

The opposite of fear is trust, or perhaps love.  Trust and love can liberate our fear.  If we trust ourselves and love the people around us and in this world, we can overcome fear.  When we can show our vulnerabilities, we can discuss and face our fears and push past them.  We can build resiliency.  If you’ve had experiences in your life where you have failed, and I think many of us have, then it reminds you that you won’t be destroyed by a failure or two of three.  You can choose to get back up again and keep trying.  And every time you do, you build even more resiliency.

Ultimately, I have decided that I can’t let fear rule my decisions or my path in life.  And this realization decision didn’t come overnight; it came after years of overanalyzing and overprocessing a lot of thoughts, emotions, and feelings.  It came from many moments I experienced or watched happening to others around me.  You know these moments; they are the moments where you’re reminded that life is short, and nothing is promised or guaranteed to us in that short life.

I’d also be remiss not to recognize my privilege here, especially as I discuss the concept of FearFIRE.  It’s a huge privilege to have been born into a life with the support and resources for me to have a safe roof over my head, a safe neighborhood to live in, afford to attend college, have the support and resources to get a good job, and so on.  Even with a life of privilege, you can still have vulnerabilities, fears, and problems.   Granted, these “problems” are more easily surmountable and pale in comparison to many problems in the world.  It’s one issue not to have enough money to put food on the table or provide a safe home for your kids; it’s a whole other type of issue to have what most would define as significant money and not be willing to spend it enjoying your life.  This is one of the many reasons I strive to practice more gratitude and push the fear I have out of my life.

I am currently pushing past my FearFIRE and into a life of early retirement in these coming months.  And this journey is wrought with fear, but I am pushing past it.  I am following my own advice above to push past it.  I aim to focus on the positives and my trust in my resilient self and forge ahead into the next chapter of my life.  And this now makes me think of Coach Taylor from the TV show Friday Night Lights, and how he would be saying to me one of his famous sayings like, “clear eyes, full hearts, can’t lose,” or perhaps “you’ve earned the right to win.”  These messages are about hope and optimism, and they win over fear most days!  Here’s to winning over our fear and understanding yet pushing past any fearFIRE you have within you.

Written while listening to The Hardest Cut by Spoon

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