fatfire vs leanfire

Not investment or financial advice. This is not an endorsement or recommendation to buy, sell or hold.  The staff of this site may own the asset/s mentioned on this page. Investing is risky and you may lose all your capital. Do your own research. See full disclaimer.

We receive no direct payments from the mentioned companies. Some links on this page are affiliate links, at no extra cost to you, we may receive commissions when you use them. However, we try our best to keep our articles fair and balanced.


What is FIRE?

  • FI: Financial Independence; Not being dependent on an active income to maintain one’s lifestyle. The most common definition of FI is saving the sum equivalent to 25x your annual earnings; this would allow you to withdraw safely y 4% a year without ever running out of money. However past performance does not guarantee future performance. This is based on historical returns for the stock market.
  • RE: Retire Early; Retire years before the official retirement date. To enjoy your healthies years to your benefit rather than that of your employer.

What is the difference between Lean Fire vs Fat fire?

There are some who would prefer to stay frugal after retirement and others who prefer to splurge a bit more after their early retirement. fatFIRE is a retirement high in expenses, and leanFIRE is the opposite a retirement which is very low in expenses.

In addition to the above two, there are also

  • barristaFIRE: Retire early but then find a fun part-time job to have your health insurance covered.
  • aveargeFIRE: This is a more typical early retirement, which combines some of all the previous three types.
  • passiveIncomeFIRE: A well-diversified passive income portfolio whose earnings are linked to inflation-adjusted is probably the safest way for early retirement.

According to the Trinity Study

  • frugal (lean) early retirement: one would need less than one million to retire. Yearly living expenses amounting to $42k
  • average early retirement: somewhere between 1 and 2.5 million are needed. Yearly living expenses between $42k and $105k
  • high expense *fat) early retirement:  More than 2.5 million in savings are needed, this would allow you to spend more than $110k a year
  • semi-early (barista) retirement: The difference between your choice from the above three and your monthly income.

Tips for fatFire

Freedom without money is no freedom. How can you live if you do not have the money to enjoy life. This type of retirement requires a considerable nest egg invested in a well-balanced portfolio that can weather any financial storm.

Optimise your investments

To make the most out of your nest egg, legally reduce all your due taxes. Employ the right professionals. Create assets structures such as onshore and offshore corps, trusts, estates, foundations and tax efficient loans. These are tools that the rich use of and if you have worked hard for your money than why not use them.

Keep track of your investing costs

Investing costs can compound to amazing figures over a decade or two. It is vital you know how much $ is going out to maintain all your investments. Identify alternative investments which are cheaper investments and make the switch. Vanguard is always there for help.

Making it is one skill – keeping it is another

Our biology is set up so that losses are more painful than the equivalent gains. This means losing 1,000 will feel like hell, but gaining 1,000 will have a minimal impact on your happiness. Keep in mind Warren Buffet: “rule number 1 is don’t lose money. Rule number 2 is don’t forget rule number 1.”

A large nest egg means either long saving time or high-risk investments. High risk investing and early retirement does not go well together.

Seek out risk avoidance measures, doing this before the risks come to you is much less costly than doing it once the problems are on your doorstep. Divorce and being sued are the first risks that come to mind.

More house does not mean more happiness

Splurging is allowed, but when does throwing money out become waste? Spending more does not necessarily make you happier. The more you spend the more you need to spend next time to get dopamine hit. As a direct consequence of spending money, a tree is being cut, plastic is being dumped in the ocean and the air is getting filthier. What kind of world will you leave to the next generation?

What world do you want to leave behind you?

You have money and life is awesome, you savour every moment of this perfect life. BUT is there more to life than gold, champagne, fast cars and international travel? Yes, there is!

A long-lasting legacy.

It is easy to achieve.

Create something that will leave the earth a better place than you have found it.

Anyway, you have the money and you can pay others to do it in your name.

Tips for leanFire

Control your expenses

Frugal retirement is dangerous! It is hard to keep expenses low eternally because life has a habit of throwing problems. Medical issues, emergency travel, older parents needing assistance and kids needing a helping hand, When these expenses are emotional, the excel budgeting excel sheet is closed and the online banking is opened. Living on $42k a year is hard (in modern western countries). Boredom and lifestyle inflation can also attack your nest egg if you allow them to.

Borrowing is a no, no

Borrowing against your nest egg is financial suicide. Who needs loans in a minimalist retirement anyway.

Avoid medical expenses: Focus on your Health

Retirement is all about the good life. The more years you have in good health, the more time there is to experience life to the full. Walking, a good diet and lifting things can do amazing things to your body. They make you healthier. Importantly they keep the doctor and medical expenses away.

Hustle your way through

Frugality is an art. You are the one to decide how much you want to pay for anything. Research, bargain, haggle and get the deals you want rather than the ones that are on offer.

Upgrade your Retirement

Let me put forth a controversial idea. Work again!

I am not asking you to go work in back-breaking building skyscrapers.

You can start many income-producing activities from the warmth and comfort of your living room. Alternatively, you can find a fun job, such as a barista, which gives you the opportunity to meet a lot of people and get social security and medical insurance coverage. Consider upgrading from a minimalist retirement to a barristaFIRE or a passiveinvomeFIRE.

Tips for passiveIncomeFire

Here on NodesOfValue.com, we focus on Passive Income. Through passive income one can create a collection of assets (rather than a nest egg) which keep on giving, creating intergenerational wealth. These assets provide multiple streams of income, and depending on their size can support both a minimalist retirement or a lavish one. Most of these assets can start as side hustles, in time and with hard work they can become autonomous assets or low maintenance cash cows.

Which of these can you start today?

What is the right choice a leanFIRE or a fatFIRE?

Your choice of FIRE-type is a personal one. It does depend on personal circumstances and preferences. Some of us have a hard time getting to leanFIRE and pretty much impossible to get to fatFIRE. Just because the flow of income is not enough or there are continuous unavoidable expenses? Accepting reality is the first step. FIRE is both a math problem and a creativity challenge.

The math problems is the challenges of saving and investing to grow your nest egg to 25x your yearly income. The creativity part is how to create the income to feed your nest egg.

Once a real decision to retire early is made, then your ingenuity will take over and get you there. It is all about persistence and perseverance.

Personal circumstances in your control

  • Date you start saving and investing. This is probably the most critical aspect of this project. The earlier you start the heavier your bags will come retirement day,
  • Your salary and how much can you save.
  • Ability to have fun without spending too much money
  • What are the tools you use for your FIRE?
  • Level of frugality that you can personally endure or enjoy
  • Retirement lifestyles / Cost of living expenses
  • Years of freedom i.e. years estimated between FIRE and death.
  • Management of the fear of not having a fixed income
  • Ability to work hard to increase income before (and after?) FIRE
  • Investing style

Personal circumstances outside of your control

  • Your IQ. This will most likely determine your salary, especially if you are an employee, not a business owner.
  • Age of Children / Grandchildren and expense you will need to pay for them.
  • Family situation. Are you divorced, single or married? Each type of lifestyle brings different expense profiles with it.
  • Debts, Interest Rates
  • Medical conditions
  • The age at which you started FIRE
  • Inheritance / The size of parent’s pockets


Any type of FIRE is ok as long as you are ok with it! In the end, it is about balancing your income from your nest egg vs your lifestyle expenses. Your situation is unique. Leveraging your strengths and managing your weakness is what a well-planned FIRE is all about. Earn as much as you can in the early (and younger) days then figure out how to keep most of it. Retire, have fun and leave the world a better place. Because this will reduce your expenses and it will also have the added benefit of a clean and sustainable world for future animal, insect, plant and human generations.

The mindset of Financial Independence and Early retirement is hard because we have been conditioned to go to school > work > retire and die.

Many people, including your friends and family, will not understand why you want to go against the grain.

Life is yours.

Go get your Fire!


Not investment or financial advice. This is not an endorsement or recommendation to buy, sell or hold.  The staff of this site may own the asset/s mentioned on this page. Investing is risky and you may lose all your capital. Do your own research. See full disclaimer.

We receive no direct payments from the mentioned companies. Some links on this page are affiliate links, at no extra cost to you, we may receive commissions when you use them. However, we try our best to keep our articles fair and balanced.


Author: Jim Reynolds
Jim Reynolds. Is passionate about finance, passive income and cryptocurrencies. He writes about his passions on NodesOfValue.com. He has worked in the tech and financial industry for a few decades. He holds a masters in business admin and a bachelors in IT. All his writings are not investment advice.

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