How to Find Your Financial Independence Number (FIRE for UK Residents)

How to Fire Your Boss: A Step-by-Step Guide to Financial Independence

Let’s be honest—we’ve all fantasized about marching into our boss’s office, flashing a smug smile, and delivering those sweet, sweet words: “I quit.” But unless you’ve got a trust fund or a rich aunt living on borrowed time, that fantasy requires a solid game plan. That, my financially curious friend, is where Financial Independence, Retire Early (FIRE) comes in.

I’m Rachel Simmons—certified overachiever, compulsive budgeter, and your sassy guide to kicking corporate life to the curb (on your own terms, of course). In this guide, I’ll walk you through the step-by-step blueprint to achieve financial independence so you can, yes, eventually fire your boss. Let’s break out of the 9-to-5 grind, shall we?

What Is Financial Independence, Really?

Financial Independence (FI) means you’ve saved and invested enough money to support your lifestyle without needing to work for a paycheck. It’s not about being rich—it’s about being free. You stop trading time for money when your investments or assets generate enough income to cover your living expenses.

Combine that with an Early Retirement mindset (the “ER” in FIRE), and you’ve got a movement of financially liberated folks who decided that life is too short to sit in cubicles filled with passive-aggressive coworkers and soul-sucking meetings.

Step 1: Know Your “FI Number”

Your FI number is the amount of money you need invested to live off your investment income for the rest of your life. It’s your freedom number. Not sure how to calculate it? Use this simple formula:

FI Number = Annual Expenses × 25

This assumes a safe withdrawal rate of 4%, based on the Trinity Study. So if you spend $40,000 a year, your FI number is $1 million.

Track Your Current Expenses

Before you can project your FI number, you need to know how much you spend—like, really know. Audit your expenses across rent/mortgage, groceries, subscriptions, transportation… even those sneaky impulse Amazon buys at midnight.

• Use budgeting tools like You Need a Budget (YNAB) or Mint
• Create categories for essentials and non-essentials
• Analyze 3-6 months of spending to spot patterns

Once you nail down your expenses, you’ll have a real sense of how much you actually need to sustain your desired lifestyle.

Step 2: Slash Expenses Like a Ninja

The less you need to live on, the faster you reach financial independence. Every dollar you don’t spend is a dollar closer to firing your boss. Think of spending cuts as little rebellions against a system designed to keep you dependent.

Target High-Impact Categories

• Housing: House hack, downsize, or move to a lower cost-of-living area
• Transportation: Ditch the new car; buy used or use public transit
• Food: Cook your own meals—your wallet (and waistline) will thank you

I’m not saying become a hermit who reuses paper towels. But I am saying question every recurring expense. Is that $150 cable package really bringing you joy?

Step 3: Maximize Your Income (Yes, You Can)

Cutting expenses gives you a good start—but increasing your income? That’s the rocket fuel for your FIRE journey.

1. Negotiate Your Salary: Don’t be afraid to ask for what you’re worth.
2. Start a Side Hustle: Freelancing, tutoring, consulting, selling printables—there’s a world of scalable options.
3. Monetize Your Skills: Got Excel wizardry? Photography chops? Use them.

The goal is simple: Earn more, save more, and invest as much of that gap as humanly (and happily) possible.

Step 4: Save and Invest Aggressively

Here’s the golden rule: Save 50–70% of your income. Extreme? Maybe. But you’re not trying to retire at 65—you’re trying to do it decades earlier. That requires a different mindset.

Use Tax-Advantaged Accounts First

• 401(k): Max it out, especially if there’s employer matching
• Roth IRA / Traditional IRA: Choose based on your tax strategy
• HSA (Health Savings Account): Triple-tax advantaged—hello, magic unicorn

Then Use Taxable Brokerage Accounts

These accounts give you more flexibility for early withdrawal since retirement accounts are often tied up until age 59½ (unless you’re comfortable with strategies like SEPP or Roth conversion ladders).

Invest in Broad Market Index Funds

You don’t need to gamble on meme stocks to build wealth. Stick to low-fee, diversified options like:

• Vanguard Total Stock Market Index (VTSAX)
• Fidelity ZERO Large Cap Index (FNILX)
• Target-date funds for simplicity if you’re just starting

Step 5: Insurance, Emergency Funds, and Peace of Mind

As we hacksaw expenses and boost investments, this part gets overlooked—but it’s critical. You can’t build a solid FIRE plan without a risk cushion.

Build an Emergency Fund

Save 3–6 months of living expenses in a high-yield savings account. Think of it as your financial panic room.

Get Proper Insurance

This includes:

• Health Insurance: Don’t skip it. Medical debt is the #1 cause of bankruptcy.
• Disability Insurance: Your ability to earn income is your biggest asset pre-FI.
• Renters or Home Insurance: Protect your stuff without overpaying.

Step 6: Practice Lifestyle Design

FIRE isn’t just about leaving your job. It’s about designing a life you don’t need a vacation from.

What Would You Do If Money Wasn’t a Problem?

This is the question that will guide your next chapter. Do you want to:

• Travel the world?
• Start a passion project or business?
• Volunteer or adopt 12 dogs?

Whatever it is, begin integrating parts of that dream life now. Don’t wait until you reach FI to live meaningfully.

Step 7: Know When You’re Ready… And Jump!

So, your investments cover your expenses, your systems are in place, and your spreadsheet tells you it’s time? Congrats—you’re financially independent!

Now comes the fun (and slightly terrifying) part: firing your boss.

My only advice here? Leave with grace. Give proper notice. Thank the good ones. Smile. And then walk into your new chapter with your head held high and your finances in control.

Closing Thoughts

Financial independence is not just for Silicon Valley tech bros or crypto millionaires. It’s for regular people who decide to live intentionally, save fiercely, and invest wisely.

You don’t hate work—you hate feeling trapped. That’s a huge difference. Once money stops controlling your choices, you reclaim your time, energy, and purpose.

So whether you’re 23 or 53, broke or just broke-ish, today is the perfect day to begin your FIRE journey. Because your freedom is out there—and it’s worth every spreadsheet, brown-bag lunch, and Saturday night spent learning about index funds.

And when that day comes, and you’re finally free to hit “send” on your resignation letter? I’ll be somewhere nearby, cheering you on through a screen and raising a glass—preferably full of budget-friendly bubbly—to your new, boss-free life.

Need advice or got questions? Reach out to us via our contact page. We’re here to help you build the life you deserve.