The five dimensions of financial independence retire early

Abstract

The purpose of the present study is to map out and extend knowledge on the conceptual territory of Financial Independence, Retire Early initiative (FIRE). This topic has produced increasing interest in the public, but it constitutes a relatively new research area for academics. In this study, we analyse the four pillars to achieve financial independence to be able to retire early: budgeting and expense control, saving and investing to earn passive income; creating additional income sources, and improving financial literacy. We also analyse the five main dimensions: FIRE as a self-improvement philosophy, as a self-help initiative, as part of the simple/ecological lifestyle, as a result of financialisation, and as a tool for financial literacy and well-being. The five dimensions we distinguish allow to approach FIRE initiative from different perspectives to have a more complete understanding, but at the same time, these dimensions unveil new approaches to research and understand the impact of FIRE in society.