Choose FIRE

JC Project Freedom Journey Towards Financial Freedom

FIRE stands for Financial Independence and Retire Early. You need to do 3 things and the journey to achieve FIRE will be easier. FIRE allows you to have the freedom to choose the lifestyle that you desire.

The Purpose of FIRE

There are a lot of people who believe the purpose of FIRE is to retire or enjoy early retirement. The actual purpose to achieve FIRE is to allow us to have resilience and freedom. You can live your life according to your own defined way and values. To put it simply, you can choose to work or not to. It is a choice. You can choose to spend time on projects which are important to you. FIRE allows you to have the ability to decide your own adventure. You will not need to make a decision that is against your will and values.

You need to know yourself, you need to understand what is the most important thing to you.

FIRE is about balancing the life you want and the assets that you need. FIRE is about regaining time and energy to enjoy life. This means you have time to spend with your family and friends. You can have time for your hobbies. FIRE means you have financial resilience, you can choose to work on things that are meaningful and purposeful.

FIRE is about choosing projects that will give you the most personal satisfaction instead of financial satisfaction. The crux to achieving financial freedom is not much you make but how much you save. Lots of people felt that you need to make a lot of money to achieve financial freedom, this is a misconception. The magic number lies in the expenses. What is your total expense?

The 3 Principles of FIRE

Financial advisors usually advocate that you put aside 10-20% in terms of savings. If you follow their financial advice, you need to spend the next forty to fifty years in a job to taste freedom. If you start your working life around 23 – 25 years old, you will need to work till 63 – 75 years old before you can retire. That’s why our government is advocating for later retirement age.

The fact is most people do not save enough money to retire at an old age. We see old people washing dishes, doing manual jobs, serving at F&B outlets to meet their daily needs. The fact is a lot of people will not achieve financial freedom.

The 3 principles to expedite our journey towards financial freedom are:
– Spend less
– Earn more
– Increase your investment returns

Most people who are pursuing FIRE have a saving rate between 30-50%. There are exception cases for a saving rate of 80%.

The downside of FIRE

Reflection on past mistakes

I have plenty of regrets, such as incurring a high expense ratio on unit trust, buying Investment Link Policy, losing money on greedy trades, and never doing due diligence.

Lost of Freedom

When we are pursuing FIRE, it becomes the most important goal and we will want to crash the time to achieve this. We will be waiting earnestly for the day when we achieve FIRE. Sometimes, we are too focused on the end goal and forget about smelling the rose along the journey. We forgot to treasure what we have. We lost some of our personal freedom and cannot be as free as before in terms of personal expenses.

Obsession with Money

We need to thread this very carefully. If you are overly obsessed with money, you may fall into another trap, you will be living life on other people’s terms and values. You need to listen to your inner self and not lose your own self during the journey.

It voices down to what you truly want in life. You need to follow your own personal blueprint to reach your desired lifestyle. Money is an important tool, it allows us to trade for things but it is just a medium. Our wants are infinite but actually, our needs can be limited. I want to dine at Michelin restaurants but my need is to fulfill my hunger. I can always choose a basic meal which cost me only $5.

Different stages of Financial Freedom

  • Zero Networth (no bad debt)
  • Set up an Emergency Fund
  • Achieve the first 100k
  • 1/2 way towards Financial Freedom
  • Almost achieve Financial Freedom
  • Financial Freedom
  • Financial Freedom with safety factor

Steps to achieve FIRE

1. Define your FU money

How much money do you need to take some risk with your career, reduce your workload, or try an entire career?

2. Understand which stage are you at

Do you think FIRE is important to you? What is the purpose when you achieve FIRE? Can you live a meaningful life without achieving FIRE?

You need to be hardworking at your day job, you need time, a concrete plan, discipline, 100% all-in dedication to achieve FIRE.

Lean FIRE vs Fat FIRE


Lean FIRE depends on cutting drastically on expenses to expedite the FIRE process. Lean FIRE is to retire before the conventional age of 60+ with a very lean and simple lifestyle. Lean FIRE means your investments can only cover your basic necessities like food, transportation, and rent. There is no room for luxuries. It is harder to have children or live in a major city if you are on Lean FIRE.

Fat FIRE is living in retirement without sacrificing your spenng. If you are Fat FIRE, you can easily survive without a job because your investment income more than covers your best life’s living expenses.

No matter Fat or Lean FIRE, you need to learn how to manage to keep income ahead of expenses. If you feel terrible while pursuing FIRE, it won’t be sustainable in the journey.

3 Factors that affect your savings rate

  • Accommodation
  • Transportation
  • Food

You need to take the following actions to calculate and monitor your expenses:

  • Calculate accommodation expenses: mortgage/rental, utilities, property taxes and maintenance fees
  • Calculate transportation expenses: car loan, insurance, fuel cost, repair and maintenance fees
  • Calculate food expenses
  • Monitor your insurance: this is critical, you are passing your risk to the insurer by paying your insurance premium

In Singapore, you have a choice. You can choose to stay in HDB even if you are high income earners through buying resale HDB. There’s option to reduce your accommodation cost. You can choose to carpool, take Grab or public transport to reduce your cost. There’s always choices available for you to reduce your expenses.


Geoarbitrage is to take advantage of your base currency and to live in a place of lower cost of living to maximize your purchasing power. You are paying for a fraction but getting the same goods and services. This will allow you to cut the journey towards FIRE, assuming that you are willing to live in the country. I am thinking of moving to Malaysia or Taiwan to enjoy a similar standard of living but drastically reduce yearly expenses.

From Numbeo, the cost of living in Singapore for four excluding rent is around S$4,857 per month. The cost of living in Malaysia is around S$2,371 per month. The cost of living in Taipei is around S$4,170 per month. Ermm… Taipei is too expensive but you can consider moving south.

Your day job is the primary investment

Financial freedom means you can stop working for a living if you want to or you can choose to continue working in a job that you like. There are lots of benefits to working on your day job. For example, if your day job provides S$50k per annum, a 40 years tenure means you have the ability to earn S$2000 k in your lifetime.

To achieve FIRE, you need to reduce your working lifespan. We need to consider 2 factors:
– How to increase your income from employment?
– How to increase the return on investment?

How to increase your employment income or your salary?

The speed for those who can achieve FIRE fast as high-income earners. This is with regards to the speed and pace but we are not referring to the criteria. You need to invest in yourself to increase your human capital. Invest to acquire new and relevant skillsets. Skill sets that allow others to pay you for your services. Invest to grow your career. This will grow your income.

Always add more value than you are paid for. Always go in with positive mental attitude.

How to increase your return on investment?

Impact from Savings Rate

When you have a higher savings rate, you have more funds to be dedicated for investment. Those who pursue FIRE will aim to achieve savings rate of 30% – 50% and above. This method is suitable for high income earners and those who endeavor simple lifestyle to achieve high savings rate. The most ideal combination will be high income earners with simple lifestyle. You just need to turn up for work, add tremendous value, deploy your salary to invest in assets. Through savings rate, you can determine when you can achieve FIRE.

Invest in ETF

Invest in ETF means you will get to enjoy market returns. It is passive, simple and boring. Boring is good. There is no way you can time the market, there is bound to have volatility. You may successfully time a market crash but if you miss the exact moment to enter right after the crash, you will fail to capture the biggest share price rise in the next couple of days.

Invest in ETF is passive, it means you do not need to spend too much time trying to research which stock to buy. You can have more time to enjoy life while working towards FIRE.

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