# Financial Independence and Early Retirement (FIRE) Financial independence refers to a financial situation in which you have enough passive income (from investments, real estate, etc.) to pay for your living expenses for the rest of your life. As a consequence, working becomes optional and you can freely choose how to allot your time. You can act on three variables to reach financial independance: 1. Reducing expenses 2. Increasing income 3. Investing As for retiring early, you should be aware that [[Early retirement depends mainly on savings rate]]; as long as you save enough money compared to what you earn, you can retire early, no matter the value of your income. Note: [[@hamishhodderOnceLifetimeFinancial2023|The post-covid world may have lasting higher interest rates]] --- ## 📚 References - [/r/financialindependence - FAQ](https://www.reddit.com/r/financialindependence/wiki/faq).