The financial independence and early retirement movements can feel large, active, and mysterious all at once. Even though I am personally a blogger and a long-time reader, I had questions. To make matters more complex, this community does not have a clear definition, boundary, or “home base.” There’s no registration system or authoritative data. There’s a lack of existing personal finance research. But, whether you read FIRE (Financial Independence, Retire Early) message boards or write about budgeting and side hustles, you’re part of the community.
So, I recently conducted a survey to try to learn more about personal finance blog readers and writers. Then, I asked personal finance experts to review the results and share their perspectives. My hope is that bringing in a variety of viewpoints will create more meaningful takeaways from this personal finance research.
Personal Finance Research Questions
- Who is in the personal finance community?
- Financially, what situations are personal finance blog readers in as they progress toward their financial goals?
- What motivates the people in the community?
- What are people’s plans and concerns for the future?
The results of the study were not flawless, but they were fascinating nonetheless. The information collected confirmed some assumptions I had about the community and challenged others.
Related: Who Is the Richest Family in the World?
Method and Limitations
Method
Participants in the personal finance research survey included readers of Semi-Retire Plan, several sub-Reddit groups, and shares and relevant hashtags on Twitter, Facebook, and Instagram. More than a dozen peer bloggers, from varying countries, shared information about the survey and encouraged participation.
I avoided sharing the survey to Reddit or Facebook groups that were country- or gender-specific.
The survey was open from August 1 to August 15, 2019.
In all, 165 people completed the survey.
Limitations
Sample Size
I would have preferred a much larger sample, but this was the response I was able to collect. I was hesitant to promote the survey through paid channels or more broadly-focused social media groups, since that may have diluted the sample with people who are not part of the target personal finance blog readers population.
Certainly, though, a much larger sample would produce more reliable data for this personal finance research analysis.
Collection Method
Due to the nature of the personal finance blog readers community (it exists primarily online and has no clear structure or organization), a volunteer survey was the only possible collection method. That being said, this method has the following limitations:
- Self-reported data may not be accurate
- The data collection was not randomized
- The groups that the participants came from may not be representative of the population
- Within each group that had access to the survey, the people who chose to participate may not be representative of that group
So, these personal finance research may not be totally representative of the entire global online personal finance blog community.
One area of particular concern, as you’ll see below, is the home country representation. The respondents were largely United States citizens. Because of this, the other data may be biased towards US personal finance blog readers. This was not my original intention, but I do understand that many of this site’s readers live in the US, so I think that outcome has an explanation.
For other variables (gender, education, income, net worth, etc.), it’s not possible to tell if the sample was biased or not (compared to the whole population of readers). I don’t have reason to believe that the sample was misrepresentative for these variables, so for the purposes of the below analysis, I will assume it is not biased.
I do still believe that personal finance research is valuable and give a data-based starting point to meaningful discussion. The data can give us direction on how we can best evolve to help each other, and to help others improve their financial literacy.
Demographics
Country
Of the people that completed the survey, 77.4% were citizens of the USA. Canada had the next-highest representation at 7.3%, followed by the UK with 3%, the Philippines with 1.8%, and India, the Netherlands, and New Zealand at 1.2%. There were also responses from Denmark, France, Norway, Poland, South Africa, Sweden, Switzerland, Turkey, and Nigeria.
As mentioned in the Limitations section, the proportion of respondents from the United States was significant. This could mean that the survey had disproportionately high participation from Americans, or that the US really does make up a large percentage of personal finance blog readers.
A Non-us Point of View
I asked my friend Cashflow Cop what his perspective was on this personal finance research.
“When Mr. SR first showed me his initial findings, I wasn’t too surprised by them. I live in the UK which has only about 0.87% of the global population, so with 3% of respondents coming from the UK, that’s pretty good going in all honestly. Now, Mr. SR has spoken about the limitations so clearly, this is far from scientific, robust or representative. However, it’s still interesting.
FIRE in the UK can be very different to the US in a number of ways:
Firstly, there is the issue of taxes. We can’t access our investment pension account until a certain age, whereas there are methods in the US to access them early.
Secondly, when I look at the medical costs in the US, I just feel so fortunate to live in a country with universal healthcare. It means our FI number can be much smaller.
Thirdly, our student loans repayment system is based on how much we earn after graduation. It means that in reality, most student loans are never paid back because people earn below a certain threshold. As a result, the monthly repayment amount for many is relatively low.
Finally, there is culture and language difference. We don’t have many FI podcasts over here and when compared with American counterparts; we just don’t come across as enthusiastic. That’s not to say we aren’t; it’s just how we come across. I’ve even met people who refuse to use the term ‘F U Fund’. It sounds so brash to some of our ears.
On balance, I think reaching FI in the UK can be less complicated than the US. As the movement continues to spread, I would expect more people to see its potential over here. Having said that, our childcare costs can be pretty high, but again, it doesn’t seem as bad as how you have it over there.”
If you’d like to learn more about Cashflow Cop’s story, check out the interview we did together.
Gender
The survey results were 62.8% male participation, 36.0% female, and 1.2% other/prefer not to respond.
Ms. FireMum from A Family on FIRE shared her view on the gender data.
“Even though anecdotally there seemed to be more men than women in the PF space, I had imagined the number of women to be a lot lower, kind of in the 20-30% range. It’ll be interesting if you repeated the survey annually to see how the male/female proportion changes year on year.
It is heartening to see the number of women bloggers represented in the survey, and I daresay that the number is increasing year on year. However, I still think that women have a long way to go in achieving equality in the domain of financial literacy.
Men are more likely to be offered financial education in the United States. In Australia, where I’m from, a recent study showed that only a third of women were taught the benefits of investing. Financial literacy is important irrespective of gender, but we also need to even up the playing field. We need more women participating and contributing equally to financial conversations, whether that be at home, at school, or in the workplace.”
M from Radical FIRE offered her perspective too.
“Over the last decade, more and more diversity has entered the personal finance world. People from both genders have been focusing on improving their finances, earning a higher income, and paying off debt. It’s extremely important to be financially educated, to make your own decisions, and let money work for you! As more women today are financially independent and interested in their finances than ever, I’m excited to see how this statistic will change in the upcoming years!”
If you’d like to learn more about M and the Radical FIRE site, read our interview we did recently.
Relationships/Marriage
The personal finance blog readers were asked if they are married or in a committed long-term relationship. 76.2% responded “Yes.”
I asked the Educator FI site for their perspective on these results.
“Wow, more than 3/4 of FI enthusiasts are in committed partnerships! Being single allows for greater flexibility and doesn’t require perfect alignment with a partner. A partnership with different financial goals can be disastrous — both for finances and the relationship.
That said, if you’re in alignment there are real financial advantages to partnering up. There’s a reason I just celebrated my 20 year anniversary as the best investment I’ve made.
Personal finance is personal and so are relationship choices!”
Education
I asked participants what their highest completed level of education is.
The responses were: completed high school or equivalent (10.4%), completed 2-year college degree or equivalent (7.3%), completed 4-year college degree or equivalent (43.3%), and completed master’s degree or higher or equivalent (39.0%). Meaning, a dominant 89.6% of participants had completed some college.
Incredibly, no participants chose the final option: did not complete high school or equivalent.
I shared the results with Enoch Omololu from Savvy New Canadians to get his perspective on the results.
“These results are not surprising. The survey was directed at individuals who have self-identified as personal finance readers and/or writers. I feel that it takes some level of ‘nerdiness’ for anyone to want to bother with reading boring personal finance material on a regular basis, let alone consider writing about it as a hobby.
Research indicates that there is a strong relationship between your level of education and wealth. As your education and wealth increases, it makes sense for you to become more thorough when planning your finances.”
Privilege in the Personal Finance Blog Readers Community
My personal thought when I saw the results was that the community seems much more educated than the general population. Is this just a correlation — certain people are prone to prioritizing both education and wealth? Or is there a cause and effect here — more educated people are privileged, and therefore have the opportunity to earn more wealth?
I asked Enoch about this, and he agreed.
“Yes, I do think that most people involved in the community are privileged and upper-middle to upper-class folks. It does appear that an ‘obsession’ with finances is more prevalent among people who are actually well-off. One could argue that the reason some people are into FIRE is actually because they can afford to be. Basically, they have the means to do so and the possibility of FIRE for many of them is not really so far-fetched.”
Note that I personally don’t think it has to be this way. Certainly, people without a college education or that have lower or moderate incomes can still benefit greatly from being intentional with their finances.
If anything, these results should be a call to action to the personal finance blogging community, myself included.
What do we need to change so that a wider audience can improve their financial literacy? Financial literacy is not a zero sum game. There’s no reason why we can’t all be working towards improving our future.
Current Age
I asked participants to indicate their current age. The average was 34.7 and the median was 33. Most respondents were in their late 20s to late 30s.
Age When They Started Following Personal Finance Blogs
I asked participants at what age they started following personal financ blogs. The average was 31.1 and the median was 29.
Educator FI shared his perspective on this topic.
“I’m thrilled to see how many people started following finances much younger than I did. That early start is a huge advantage and will serve them well. Time is our biggest ally and smooths over a lot of bumps.
It’s not surprising that so many first discover FI/RE in that mid-20s to early 30s range. That’s when the reality of the career grind can often hit. Rather than just accepting it, they started looking for a way to improve their lives!”
Rent vs Own
I asked the personal finance blog readers about their primary residence. Do they rent, own, or other — including full-time travel, living in a van, etc. 61.0% own, 34.1% rent, and 4.9% chose other.
I asked Andrew from Wealthy Nickel to share his view of this personal finance research. There are pros and cons to either approach.
“A lot of digital ink has been spilled in the rent versus own debate. There are many pros and cons to either side, and there is no one-size-fits all answer. Renting allows you the freedom to move around for your job or family without incurring the costs associated with selling your home, and it also gives you more capital to invest because you do not have money tied up in a down payment on a home.
However, owning can make a lot of sense if you plan to stay in one place for awhile (generally 5+ years). You don’t have a landlord telling you what to do, and if history continues, your home will appreciate at about the rate of inflation. If you have a mortgage, you are leveraging your money and could be increasing your net worth by 5X the rate of inflation or more!
I think those the FIRE camp tends to be weighted toward homeownership because it allows for more control (and financial independence is all about control). Many in the FIRE movement are trying to lower their monthly expenses, and a great way to do that is to pay off your mortgage and own your home free and clear. Of course you still have the ongoing taxes, insurance, and maintenance, but it will certainly be a more manageable monthly payment than rent when you are retired and on a fixed income. Real estate also seems to be a popular asset class among FIRE adherents, and one of the best ways to get started in real estate investing is by house hacking (owning your primary residence and renting out rooms or additional units).”
The Fire Movement
I asked participants if they considered themselves to be part of the FIRE movement. 64% said yes.
I had always assumed that the FIRE movement was a vocal minority in the personal finance space, so this proportion was among the most surprising results to me!
Related: 12 Ways To Save Money on a Tight Budget
Motivation
Motivation for Retiring Early
I asked participants what motivates them to want to retire early. There were 8 response options: feeling of freedom or independence (52.8%), more time with family (14.1%), I don’t like working generally (8.6%), I have to; it’s inevitable (8.0%), more time or money to travel (7.4%), more time or money for hobbies (6.7%), I don’t like my current job (1.8%), and more time to serve my community or religious community (0.6%).
Adebayo Fasanya from Dr. Breathe Easy Finance offered his perspective on these results.
“It is not surprising to see that the majority of people agree that freedom is the most important motivation to save money for retirement. It makes sense because if you are financially independent, you will be able to do everything else on that list. For example, spending time with family, more time to travel, fun hobbies are possible if you don’t have to worry about having enough money for retirement.
Financial freedom and independence is a major component of the FIRE movement for that reason. Unfortunately, nowadays, we cannot rely on traditional forms of retirement savings, such as Social Security. Rumor on the street is that it might not even be there in the next 30 years.
As a beginner attending doctor, I fall into a unique group of people called HENRY (High Earner, Not Rich Yet) and it is one of the most uncertain positions to be. There are usually many pressing needs at the same time. For example, after finishing training, I had to focus on paying off my 300k student loan, deciding whether to buy a house or not, and whether investing should take the back seat while paying off debt.
At the same time, the landscape is changing drastically in medicine that doctors tend to work more for less pay. It is almost impossible to strike that balance between a fulfilling career, high salary, and work/life balance. That is why I decided to at least maximize my retirement account throughout training while paying off student loan debt.
My goal is to become financially independent as soon as possible, hopefully in 10 to 15 years, so I can have more time for family, travel, hobby and be able to enjoy life without worrying about money.”
Worldview
I asked participants if their financial philosophy and non-financial worldviews have changed as a result of their experiences in the personal finance blogging community.
74.5% said that their financial philosophy has been affected by the personal finance blogging community.
Only 38% said that their non-financial worldview has changed as a result of the community.
Of those who said their financial philosophy had changed, common themes were: learning new tools for money management and investing, feeling motivated to save not just to have money but to meet future non-financial goals, and believing that wealth is achievable for anyone.
Those who said their non-financial worldview has changed often cited (1) increased feelings of control and happiness in their own lives or (2) increased understanding and interest in global economic issues.
I found it interesting that there seems to be a group of people who compartmentalizes their financial lives from their larger worldview. My own experience has been similar to those that did say that their non-financial worldview changed. As I learn more about personal finance, I find that I have a growing interest related subjects including psychology, economics, and even just learning about other people’s lives.
Favorite/Least Favorite Parts of the Online Community
I asked participants what their favorite and least favorite aspects of the online personal finance community are.
51.5% said that helpful information was their favorite part, followed by the friendly and supportive people/the feeling of community (29.4%), comparison/it serves as a benchmark (12.9%), and accountability (2.5%). Several respondents chose “Other” and wrote in their answers, which included “all of the above” and “motivational stories.”
31.0% said that comparison was their least favorite part, followed by judginess (28.4%), unhelpful information (9.7%), none or N/A (which were write-in responses) (9.0%), people are cold/distant/not friendly (5.8%). Several respondents chose “Other” and wrote in their answers, which included that the community has a reputation to cater to “White Male Tech Workers,” people are just out to make money, the information is too US-centric, the community is cliquey, the information is too basic, and people think other people are bragging but they’re just trying to tell their story.
I asked Mr. The Poor Swiss to comment on these results.
“The results from the study are really aligned with my experience with the community. On the one hand, it is full of very helpful people that are ready to spend a lot of time sharing their knowledge with everybody. The amount of information that is available for free on the internet is incredible. And I have seen many cases of people helping others on their way to Financial Independence. It is really great.
But on the other hand, a lot of people (often not bloggers, more the comments and forum users) are extremely judgemental and critical of other people. And a lot of people are completely ignoring the context. Countries and incomes should be taken into account when comparing expenses. But people are very quick to judge that if you spend more than them, you are simply worse! Many times, I have seen that people have been criticized because they were still buying their Starbucks coffee every day! This is pretty sad.”
People Who Keep Them Motivated
I asked the participants which personal finance personality has been most influential in their lives. There were 9 pre-set options of people who I regarded as the most influential, plus an “Other” option with the opportunity to write-in responses.
Mr. Money Mustache was the most frequent response (28.5%), followed by Dave Ramsey (18.5%), “none” or similar write-in responses (7.9%), the Mad Fientist (4.6%), Vicki Robin (3.3%), Paula Pant (2.6%), Suze Orman and Clark Howard (both at 2.0%), and J. Money and participants’ parents (both at 1.3%). Several other write-in responses were offered as well.
Brian from Debt Discipline shared his perspective on these results.
“There are many influential and controversial figures in the personal finance space. Two that stand out are Mr. Money Mustache and Dave Ramsey.
Pete, aka Mr. Money Mustache, is considered the founder of the Financial Independence Retire Early (FIRE) movement. His blog has a legion of followers, and Mr.MM has laid out a blueprint for reaching FIRE.
Have you ever heard a debt-free scream on the Dave Ramsey show? If not, give them a listen. They are super motivating. If you are struggling with debt, Dave is a go-to guy. His real-life examples of others who have overcome their debt, highlight the strength of his seven baby steps he preaches on his daily radio show, in books or during one of his live shows.”
Financials
Net Worth/Income
I asked the personal finance blog readers several questions about their net worth and income. Results are in US dollar value. For these results, I am not maintaining the scale of the histogram for extreme values. I will list the extreme values for each chart, but you’ll notice some jumps in the scale at either side of the histogram. This keeps the histograms from becoming too wide.
There are some extreme values on both sides of these distributions. They could be accurate or they could be mis-typed, but I decided to leave them in. The median and percentile results are resistant to outliers, so those statistics will give the best indication of what’s typical for the sample.
Net Worth When They Started Following Personal Finance Blogs
For starting net worth, the 25th percentile was $0, the median was $30,000, the average was $196,474, and the 75th percentile was $200,000. That the average was so much higher than the median shows that there were some extreme outliers from high net worth individuals.
The lowest three values were -$300,000, -$300,000 and -$200,000. The highest three values were $5,000,000, $2,000,000, and $1,800,000.
Current Annual Household Income
For current annual income, the 25th percentile was $65,000, the median was $110,000, the average was $139,797, and the 75th percentile was $160,000.
The lowest three values were -$300,000, $0, and $0. The highest three values were $1,000,000, $900,000, and $600,000.
Current Net Worth
For current net worth, the 25th percentile was $4,000, the median was $210,000, the average was $797,239, and the 75th percentile was $650,000. Again, the average was higher than both the median and the 75th percentile, showing the influence of some outlier high net worth values.
The lowest three values were -$300,000, -$300,000, and -$130,000. The highest three values were $25,000,000, $13,000,000, and $8,000,000.
Insights
I talked with both Kevin from Just Start Investing and Clint Haynes, CFP from NextGen Wealth about these net worth results. Here are Kevin’s comments:
“Net worth is arguably the most important financial metric you can track — it’s your financial pulse. Whether you have $1 million stowed away, or just $1,000, it’s important to know where you stand so you can know when you can retire.
The beauty about net worth is that if invested in index funds, you’ll see it grow exponentially over time. You’re first dollar is harder than your tenth which is harder than your hundredth — and so on. Things get easier once you get the ball rolling.
Not surprisingly, if you are tracking your net worth, is that as you get older your net worth gets bigger! That data held up here.”
If you’d like to learn more about Kevin from JSI, check out the interview we did a few weeks ago.
Clint Haynes shared that there are some factors that early retirees should consider.
“The net worth and income results are affected by some high net worth individuals. Regardless of your income, if you are wanting to retire at age 50, you should probably be saving at least 40-50% of your income if you’re wanting to maintain the same lifestyle. Now, if you’re wanting to cut your expenses in half when you retire that’s a different story, but I’m guessing most individuals want to maintain the same standard of living.
One of the biggest expenses you’re going to have to account for when you do retire early is health insurance. Depending on your situation, this can easily add $1,000 to $2,000+ to your expenses each month. You must account for this when running your expense numbers. With that being the case, I’m a huge proponent of taking full advantage of a Health Savings Account if you’re participating in a high-deductible health insurance policy. Here’s a great piece I’ve written about HSAs and why I absolutely love them. If you’re wanting to retire at age 50, fully funding a Health Savings Account prior to that can offer you incredible tax savings when it comes to paying for medical expenses and health insurance.”
Work Intensity/Hours
I asked participants how many hours they work per week on average.
The 25th percentile and median were both 40 hours per week, the average was 40.8 hours per week, and the 75th percentile was 45 hours per week.
Peter from Counting Every Dollar responded to these results.
“Most of the respondents work 40 hours a week. I find this intriguing –- it’s quite a bit higher than the 34.3 hours worked weekly by the average American. Are we FIRE-folks working longer than the average person who probably doesn’t seek financial independence? I am not surprised to see quite a few people working extremely long hours either. I work around 60 hours a week at my day job but then spend another 5-10 hours a week on my online semi-passive side hustle which made over $30,000 last year.
I know the general advice is to focus on growing one’s primary income and I fully agree. But once that goal has been met and you have reached the limits of your career ambition, what then? Side-hustles, however small, can shorten the time to financial independence because they increase your savings rate. This is especially true if your expenses in retirement will be comparable to your side-hustle income. If you plan to semi-retire, it’s also a great way to nurture a profitable passion project that will also ward off sequence of returns risk.”
Financial Instruments
I asked participants which financial instruments they use, and they chose from a pre-set list and/or wrote-in responses. Here are the results:
- Checking account — 95.2% of participants
- Savings account — 92.7%
- Tax-advantaged or retirement investment account — 87.9%
- Taxable brokerage investment account — 71.5%
- Real estate/rental property — 26.1%
- Entrepreneurship/private business ownership — 20.6%
- Peer-to-peer lending — 13.3%
- Annuities or insurance products — 9.1%
- “Other” including gold, business loans, pensions, fine art, and cryptocurrency — 0.6% each
Enoch from Savvy New Canadians commented on this data.
“Basic checking accounts are a necessity for everyday living. You work, your salary is paid into your checking, and you spend from your checking account. Whether you plan to save money or not, a basic savings account often comes in the package when you open a new checking account. As such, the over 90% results for these two accounts are par for the course.
I’m not surprised that of the 165 people who responded to the survey, 87.9% have a tax-advantaged retirement account compared to 71.5% who have a taxable brokerage account. It makes sense for a greater percentage of people who invest to first utilize tax-free or tax-deferred investment accounts.
Retirement Planning
Projected Retirement Age
I asked the personal finance blog readers at what age they plan to retire. The average was 51.79 and the median was 50.
Clint Haynes, CFP from NextGen Wealth offered his input on the retirement age results.
“I think it’s fantastic that so many people want to make it to financial independence as early as possible. It’s certainly a movement that has come on strong and I love that people are starting to take control of their personal financial lives.
However, there are some things to consider if you’re wanting to retire around that age 50 mark. One of the biggest being that you’re not able to access IRA funds penalty-free until 59.5 or 401k funds until 55 (as long as you leave it in your 401k). Now, you do have the 72t option for withdrawing money from an IRA prior to 59.5, but I would much rather recommend letting that money compound until you get to at least 59.5. Remember, the power compound interest becomes much more impactful the longer you let it work for you.
Because of these withdraw rules, you must have enough money set aside in a taxable account or have enough side hustle/passive income in order to bridge the gap before you can start taking money out of your IRA or 401k. It’s extremely important to consider and plan for this if you’re wanting to retire prior to being able to withdraw money penalty-free from your IRA or 401k.”
Educator FI also responded to this data.
“The retirement age targets reflects what we know about how humans tend to think. There are spikes at each of the major ‘milestone’ ages. I’m flexible on my retirement age, but know I want to be FI by 50 for no other reason than it seems like a good target!”
Retirement Relocation
I asked participants if they planned to retire to a country other than the country they currently have citizenship.
66.5% said no, while 22.6% were not sure, and only 11% said yes.
Insights — Myles Wakeham on Retirement Location and Healthcare
I asked Myles from BeUnconstrained to share his perspective.
“The results here are not surprising, but parallel a different statistic on the percentage of US citizens that hold a passport. According to Forbes, it is around 42%, which is about consistent with the number of respondents in the survey that either intend or would consider living outside of the USA if they were to retire.
So my initial reaction here is that US citizens do not value internalization as much as non-US citizens and residents. It would be interesting to do the same survey in Europe, as I think you would get polar opposite results.
That said, the definition of ‘retirement’ might need to be associated with age. The one reason that people do not migrate to other lands is because they become more reliant on healthcare. So if the retiree is 65 or older and is considering a reliance on Medicare, then they will not have access to that outside of the USA. If the retiree, however, is under the age of 65, they may not be considering the incredibly high cost of medical insurance that they will bear because they are not being subsidized by an employer.
When considering that a monthly healthcare premium could be higher than $1,000 per month depending on the number of family members, location, etc. then it would be a considerable factor in where one would live. In Arizona, for example, it is not uncommon to see families paying $1,000 or more per month for healthcare premiums, with the highest premium costs being associated with the poorly named ‘Affordable Healthcare’ plans (ie. Obamacare).
Considering the high cost of health insurance, one would think that this would be an incentive to move to a different region in which this cost is greatly reduced. What many forget to note is that the cost of healthcare in other countries (e.g. Mexico) can be 10-20% of the cost of US healthcare, often with the entire cost of major surgery being covered less than the cost of one’s out of pocket deductible.
None of these factors probably are front and center in the minds of early retirees, but although living in a foreign land may be a bridge too far for many, visiting and taking advantage of elective surgery or other factors that other countries offer that are better than available in your domestic region, should be an option to consider. This requires the individual to think beyond what they see on the nightly news and realize that going to a place where they are treated best is an option well worth taking. Again, I have grave doubts as to the number that will embrace this opportunity, but although maybe a full migration to a foreign land might be something few will consider, the time available to be able to do this for specific objectives could be well in the financial interest of those willing to go where they are treated best.”
If you’d like to learn more about Myles, check out our Sitting Poolside conversation.
Insights — M on Retirement Location and Fast-tracking Your Timeline
M from Radical FIRE also commented.
“Deciding what country you want to retire in is a highly personal decision. Many people would prefer staying in their current home, being close to family and friends. There are also many options to move within your home country, to a place where the cost of living would be lower or you have better weather. For others deciding where to live when they retire seems like a decision that doesn’t need to be made yet. Perhaps you want to move, who knows? When it is still far away, changes can be made later.
However, I know some people think about geo-arbitrage, a.k.a. retiring in another country than they currently live in. These are people who want to live in one country when they retire or people who want to travel in retirement. If you move to a country where the cost of living is cheaper, you will benefit from that – you can live more luxurious or you can live on less. You can even travel and spend less money compared when you would stay at home, win-win. Whatever your personal preference is, retirement can seem far away. Do you want to fast track your way to retirement? Try to make more money, live frugally and save your way to (early) retirement!”
Concerns
I asked the personal finance blog readers, “When you think of your current or future retirement, what do you feel most concerned or least confident about?”
The top concern was healthcare/health insurance (38.7%), followed by running out of money/not having enough saved (24.5%), getting bored or depressed or lonely (12.3%), long-term care cost (7.4%), not being informed/educated enough to manage their resources (4.3%), risk of pension benefits being cut (3.1%), risk of Social Security benefits being cut (1.8%), and nothing (1.8%).
Derek from The Money Family responded to this personal finance research.
“Worries about future health insurance costs, especially as a family of four, is the biggest concern in our FIRE plans. Our previous plans had us reaching FIRE when the kids were in their early teens but we have updated our assumptions to include part time/flexible work arrangements until the kids move out. This will give us more optionality in raising or lowering our income with changes in potential health care and insurance costs.”
Personal Finance Research — Major Themes
I have three big takeaways from these survey results.
Freedom and Control
Freedom was the top motivator for retiring early. Also, healthcare was the top concern about retirement, and several of the expert commenters mentioned healthcare concerns in relation to other survey topics.
To me, the reason healthcare is such a concern relates back to that same pursuit of freedom and control. In the US, healthcare can be very expensive and/or it can be tied to your employer. These are costs that individuals have little control over.
So, overall, the pursuit of personal freedom seemed to be the overarching theme.
Expanding the Audience
In general, it seems that the personal finance blog community is viewed as a helpful resource that has had positive change on readers’ lives. However, one of my main notes after reviewing this personal finance research is that the community currently seems to be geared to American, educated men.
I feel awkward that I’m furthering those numbers since I fit that description, but I hope that all of us can create content and pursue channels that are accessible and helpful to people of a wider demographic. We need to.
Comparison and Openness
Related to the above concern, the biggest complaint from personal finance blog readers currently involved in the community seems to be that it can encourage comparison or judginess. Even through this review of the personal finance research, I’m finding it difficult to not compare myself with the averages and high results.
I think one of the first steps to expanding financial literacy and the personal finance blogging audience is to fight this trend. Each of us, individually, can only start from the situation we are in. You can only play with the hand you are dealt. The more we can encourage comparison with your own financial starting point, rather than others’, the better.
Financial literacy and early retirement shouldn’t just be for Americans, men, or people with a college education.
What are your takeaways from the personal finance research? Will this affect how you write or read personal finance blogs in the future?
