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How to Find the Perfect Balance Between FIRE & YOLO

Have you ever felt torn between saving diligently for early retirement and indulging in the pleasures that life offers in the here and now? If so, you’re not alone.

In the world of finance, there are two popular ideologies that stand in contrast to each other – FIRE (Financial Independence Retire Early) and YOLO (You Only Live Once). The former emphasizes frugality and aggressive saving to achieve early retirement, while the latter champions living in the moment, often at the expense of long-term financial planning.

The Prudent Plastic Surgeon presents a compelling and relatable journey toward achieving this balance.

Before I begin, please let me be the first to say that I have not found the perfect balance between FIRE and YOLO.

I’m still working on it. But honestly, I think I do have a pretty good grip on it. I’m at least toying around near the right intersection between the two philosophies.

What I am very confident in, however, is that finding this balance between FIRE and YOLO is super, super important.

First, some background

My guess is that most of you are aware of these seemingly opposite personal finance philosophies of YOLO and FIRE. But, let’s just spell them out so we are all on the same page.

FIRE is the Financial Independence Retire Early philosophy. Basically, it is the group of people working to reach that point where they don’t have to work anymore. There is a ton of debate about the Retire Early portion of this moniker. But I don’t really get hung up on that. I seek FIRE to follow my passions as a plastic surgeon on my terms because I want to, not because I have to.

YOLO is a bit of the antithesis. You Only Live Once. You can’t take money with you when you die. So buy the Tesla even though you have over $400K in student debt. Get the huge house. Basically, just YOLO.

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The problem with the extremes

Like most things in life, both of these philosophies have some merit. But the merit is found somewhere in the middle, not at the extremes. Let’s examine.

FIRE balance

Don’t even think for a second that I wasn’t gonna make a graph for this post!

Take FIRE to the extreme

Save 75% of your doctor’s income, which averages around $200-250K in the United States. Live in a meager apartment. Eat Ramen noodles every night. At age 37, you can retire and live this lifestyle on your nest egg alone. Congrats, you FIRE’ed!

But, is this really the goal? I say no. We also have to splurge and treat yo’ self sometimes.

FIRE balance Treat yo' self

Now let’s take a peek at the flip side…YOLO lyfe

Your income is in the top 1-2% of everyone in the world.

Live. It. Up. Buy the huge house for $1.5 million. Don’t save up for retirement, there’s time for that when you’re older…or dead.

Just like paying back loans…that’s a future problem. Sushi every night baby. That’s the motto. Ugh…wait a second. Now you’re 60. You’re tired of your job.

But you still have a ton of debt. And you need to keep making mortgage payments. And payments on the jet ski…even though you live in Cleveland. Welp, you can’t retire. You can either significantly reduce your lifestyle or you can keep working til you die.

I don’t like either of those options.

Where is the balance between FIRE & YOLO?

I hope at this point I’ve successfully demonstrated why one or the other of these philosophies is no bueno.

So the next logical question is, “Where is the balance?”

It’s not a simple question. And it will differ a bit for every person.

But I would say that the balance for the average person is for you and your family to enjoy life intentionally while taking action to be secure in a future that you control.

Yep. That’s a bunch of word salad. Means nothing.

Let’s get practical and find a FIRE balance

Ok, average physician. What’s the FIRE/YOLO balance?

Here it is:

  • Save 20% of your income
  • Invest that 20% according to your financial plan
    • I recommend low cost broadly diversified index fund and/or cash-flowing rental real estate
  • Use the remaining 80% to enjoy your life with the intention
    • This means that you should buy things when the joy you receive from them is equal to or greater than the sticker price. You also need to be able to buy these things without debt and within the confines of your financial plan/goals.

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In that sense, it is really not that difficult at all.

Tailor it to your goals

Now, everyone is going to be unique and different. That’s why it’s important to set your financial goals as a first step in determining your financial plan.

That’s what Selenid and I did.

We created our financial goals. Then we set our budget and savings rate. Then we came up with our investment strategy. This comprises our financial plan. You can find the whole thing using the link below.

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We know that we will reach our goals if we follow our plan. So we have no guilt or worry about spending the money that we have earmarked to spend. We buy things intentionally and enjoy the heck out of them.

That’s a big reason why we felt so confident buying our first home instead of renting, which is the more generalizable advice that I usually give.

Related Post:
Rent or Mortgage Your First Home? [Why I Didn’t Follow My Own Advice]

It’s a spectrum

Some of you may want to save more and reach financial independence sooner. Fine, your balance will be a bit more along the FIRE side of the spectrum.

Some of you may want to enjoy the finer things a bit more upfront and are okay with the prospect of working longer or having to save more later. Cool. You will be more along the YOLO side of the spectrum.

It’s all Gucci as long as you know you are meeting your goals.

But, you have to make sure that you have thought out your goals!

Where do I fall on the spectrum?

I think I’m near the sweet spot in the YOLO FIRE balance. But I’m not quite there.

Honestly, I probably lean a little bit too far to the FIRE side. It’s natural probably given that my financial journey began with significant burnout that was largely attributed to a lack of financial well-being. I don’t want to experience that again.

But it’s also a bit natural for me as a person. I have a tendency to focus too much on a goal (any goal) at the detriment of enjoying the moment.

But this is why it is so important and awesome to have a great accountability partner. In my case, it’s my wife Selenid. She keeps me in the moment when I get too far-sighted.

So thanks to her and my ever-improving mindset, I become more centered every day.

But, most importantly, we do spend intentionally with a focus on experiences that increase our joy and help us to really enjoy the present. But we also save and invest enough to reach our financial goals on time (in fact, in most cases so far, it has been ahead of time.)

We take that as a win!

So, how can you determine your balance along the FIRE and YOLO spectrum?

What do you think? Are FIRE and YOLO a spectrum? Where is your balance between the two? Let me know in the comments below!

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2 thoughts on “How to Find the Perfect Balance Between FIRE & YOLO”

  1. Subscribe to get more great content like this, an awesome spreadsheet, and more!
  2. Love this, always a push and pull between the planning for the future, and living for the days of which you don’t know how much is left!


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