ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -As per the FIRE movement, the amount of money needed to acquire financial independence equates to 25 times your annual spending. This figure is referred to as your “FIRE number”. To understand this better, consider you currently spend ₹5 lakhs each year. By this logic, your fire number would amount to ₹1.25 crores.

Detailed explanation-2: -Adherents of the FIRE movement-short for financial independence, retire early-aim for a target of 25 times your annual income in retirement. The figure, known as your “FIRE number, ” is based on the idea that you can safely withdraw 4% of your portfolio per year, adjusted for inflation, without running out of money.

Detailed explanation-3: -FIRE stands for “Financial Independence, Retire Early.” The goal is to attain enough wealth to retire early through a combination of a very high savings rate and a frugal lifestyle. And we aren’t talking about retirement at 55. Most FIRE practitioners aim to retire in their 40s or even earlier.

Detailed explanation-4: -You should start by investing 15% of your income into tax-advantaged retirement savings accounts, like 401(k)s and Roth IRAs. The key is to get into a regular habit of saving and investing every single month.