As poor an acronym as it is(*), F.I.R.E. (Financial Independence Retire Early) has become widely known, inspiring many to spend less and save more.

Not everybody thinks it is a good thing, however, and we are probably guilty of setting a bad example – indolent, hubristic, aggressive, patronizing, flippantly roaming the globe in luxurious fashion…

… so when the economy struggles and the stock market implodes, I am unsurprised that some headlines and individuals are excited for the opportunity to say, “I told you so” or to predict “the death of FIRE.”

Are early retirees at risk of serious F.I.R.E. Damage?

I’ve seen a lot of tweets and comments to this effect over the past few weeks, which I’ve lumped into 3 general categories:

  1. The Douchebag – “haha you FIRE F#@kers are screwed now. Enjoy poverty.”
  2. The Passive Aggressive – “I’ve always wondered what these FIRE people would do in a real downturn. I hope they will be OK but I kind of doubt it.”
  3. The Faux Concern – “Oh this is terrible. I’m so worried about people who’ve taken on all of this risk by retiring early, what will they do now? How can they even find jobs with the economy shut down?”

How… weird.

Is it warranted? I had coffee today for the first time in a couple months so allow me to channel that agitation…

Economic Forecasts

Economically speaking, things are bad out there. The stock market is down 25% or so, the economy is on lock down, and Initial unemployment claims reached unprecedented heights (and climbing.)

For perspective, compare to the economic downturns of 2000 and 2008… (literally off the charts.)

unemployment initial claims pandemic

data source

By one estimate, we could see unemployment rates of greater than 30% in the coming months, exceeding levels last seen during the Great Depression (24.9% in 1933.)

Goldman Sachs is forecasting a 24% drop in GDP in Q2 2020 as the US economy just… stops.

Given the depth of the disaster and comparisons to The Great Depression, has F.I.R.E. flamed out?


We are about 1 month into this current downturn. Did somebody retiring at the peak in 1929 die of starvation after 1 month?

No, they were able to spend an inflation-adjusted 4% of the initial portfolio value year after year for 35+ years. Maybe some problems will pop up in month 419.

At the time of writing US stock markets are down about 25%.

Do people retire early just assuming the stock market never goes down? That’s the impression I get from the headlines…

They All Retired Before They Hit 40. Then This Happened.

… which, given the extensive analysis on portfolio longevity in poor economic environments, is just… dumb?

An Epic Stock Market Decline

This is our 3rd real stock market decline, and as part of planning for a life without jobs I wanted to understand the worst of times.

Leading into the Great Depression, the stock market crash of 1929 was one of epic proportions… between September 1929 and June 1932 the market would decline nearly 90%.

So we are down about 25% now… for a 90% total decline, the market would need to fall…

… another 25%…

… and then another 25%…

… and then another 25%…

… and then another 25%…

… and then 25% more…

… and then another 25%…

… still not done…

… fall 25% more…

… and now, finally, we are down 90% total.

Perhaps “I told you so” is a bit… premature.

We’ll Be Fine, Thanks for Asking

At present we are sitting on about 7 years of cash and bonds, even without changing our lifestyle or earning additional income (although we are open to both.)

If this was a repeat of 1929, we have another 35 years or so before we run out of money.

Social Security extends that maybe another 35 years. Now I am 115 years old.

But pandemics have happened before (and will happen again) – eventually they run their course or humans find a cure. That takes 12-18 months.

Here is a chart of the S&P500… can you find the flu pandemic of 1968? (killed 1 million) How about the flu pandemic of 1918? (killed 20-50 million) (data)

Maybe 7 years of cash and bonds is too much.

data source

In short, we’ll be fine. People who have saved 25+ years worth of expenses are not the ones we need to worry about.

Will the concept of saving that much money lose favor in the coming months and years?

After job loss, food insecurity, perhaps having to raid the retirement accounts to get by, I would think people are MORE interested in targeting a similar level of financial security rather than LESS.


Stock market declines happen. Recessions happen. Pandemics happen. Bad headlines happen.

This is known. (But stressful nonetheless.)

People who have saved 25+ years worth of expenses will be fine. Sorry.

People who haven’t saved will be more interested in financial security going forward.

For now, I think it is better to focus on:

  • staying safe and healthy,
  • helping our friends, families, and neighbors,
  • spending time and our stimulus checks to help our communities

But that’s just me, I could be wrong. Feel free to let me know about it in 70 years or when the stock market is down 90%.

Stay safe!

ps: 2 cups of coffee was a bad idea lol

(*) A better acronym would be YARDWTFYW