Why 40s is the PERFECT time to pursue FIRE

Why 40s is the PERFECT time to pursue FIRE
Photo by Ksenia Kudelkina on Unsplash

For ME.

Ok, so I only stumbled upon the FIRE concept in my late 40s.

And that it was not a movement in my 20s. Or maybe it was but I wasn’t aware of it. It was probably just not named FIRE.

Obviously, if you are pursuing FI in your 20s or 30s now … woohoo … good on you! Wish I were that smart and disciplined in my younger days but alas!

Life Begins at 40

But how much longer will you live?

According to mylongevity.com.au I can expect to live to 80 years old. This is based on my answers to a few questions online about my Surroundings, Health, Attitude, Parents and Eating (SHAPE Analyser).

This is obviously not gospel and at best, an intelligent guesstimate. I may be hit by a bus tomorrow or live to a hundred. I may improve my longevity by eating healthier, exercising more and probably reducing my stress levels. But It gives me a time frame to work with. 

I will need to make sure I can fund whatever lifestyle I want well into my 80s and beyond. 

So, that means I have to finance a minimum of 33 years of a life I want to live. In fact, since I am conservative in nature, I will plan to live to a hundred, just in case I beat my genes. If I die before then, my beneficiaries will profit – which is not a bad thing.

Higher Earning Capability

The problem lies in the reduced number of years I have left to generate the income required. But people pursuing FI in their twenties plan to work for 10 years then retire. So why can’t I apply the same principles and achieve the same outcome? I will still retire before the traditional age of 65.

But luckily, my 40s is also the peak time of my earning capabilities as per data from the Australian Bureau of Statistics. (As an aside, isn’t it disturbing that females earn so much less than males?)



So even though I have a limited amount of time to earn the required income, it is true that I am earning a lot more now than in my 20s. Therefore in theory, I have more money to put towards my saving goals.

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Side Hustles

Let’s not forget the FIRE community’s exhortation to earn more via side hustles or work extra shifts at your current job. Which may be easier said than done, to be honest, in our forties. We have many more competing priorities such as taking care of our children and elderly parents, compared to when we were in our twenties.

But developing side hustles can be a fun and creative outlet filled with hope. How can I fully utilise existing skills (learnt from years at work and having hobbies) to create a side hustle? Are there skills I can learn right now that can help me with this side hustle? Can I turn my hobby or something I am very passionate about into a business?

There are millions, yes millions (feels like it!) of blog posts about side hustle ideas, some of which pay more than others. I listen to The Side Hustle Show podcast to get ideas and learn from people who are doing it well.

Setting up a side hustle may require a lot of time and maintaining one may or may not require as much time again. The word hustle itself implies it takes energy and time.

Therefore there is a need to balance the extra time invested versus the income generated. Yes, the goal is to increase income. But I feel, strongly, that it should not come at the expense of mental health and happiness. Your side hustles should not be adding more stress to your already time poor life.

Time to take on More Responsibility or Leadership Role at Work?

Perhaps the wiser course is to focus on your current career and negotiate pay increases. I fully understand that in some industries this may not be possible every year. If you are already being the best you can be at your current role, ask your employer if there is a better paying role for you, a role with more responsibilities.

Employers and managers appreciate anyone who can offer solutions instead of whinging about problems and obstacles all the time. Step up and be noticed. You may have to show them that you are capable of taking on more responsibility before being compensated for it.

But once again, it is important to find balance here. There is no point in taking on more responsibility at work if it means that you have no time to take care of yourself or your family.

So even if I were not earning a higher income now in my 40s, I can take steps to improve my situation. 

Eliminating Debt

I eliminated my debt (house mortgage) in my 40s. Even though some argue that a home mortgage is good debt, it is still a debt that you owe someone else. Which you pay interest on – to the other person (or bank, in this case). You can save a lot of money in terms of interest by making extra payments to your loan. See how much faster you can repay your mortgage by using ASIC’s Money Smart mortgage calculator

Owning my house is priceless. Knowing that no one can kick me out of my house or take my house away, helps me sleep infinitely better at night. And I can redirect all my mortgage payments towards my investment fund now.

If you have debt, write down a list of your loans with the amount owing and the interest you are paying on each loan. Are there any loans under $500 perhaps that you feel you can knock off quickly? Now, look at the highest interest loan –   direct all your spare money to this loan after making minimum payments on all other loans. You may be surprised at how quickly you can eliminate your debt.

Reduce Spending

I have bought a lot of crap in my lifetime. So now in my 40s, it is time to rein in the spending and learn to spend with intention.

There is no longer a need to furnish the house or upgrade appliances. I am happy with what I have. I buy quality clothes that last many many years and have no need to change my wardrobe according to the latest fashion trends.

Tracking my expenses allow me to work out where my money is going and how to reduce any high spending category.

My achilles heel remain my willingness to spend on my travels. I will work on this …

It is time to embrace minimalism and frugality – the less I spend, the more I save – towards paying off debt, increasing investment funds, contributing extra payments to retirement accounts etc.

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Compound Interest still Works in Your 40

Fortunately for me, I did contribute extra to my superannuation retirement account in my 20s. And even though I stopped extra contributions for most of my 30s and 40s until recently (when I started again), that money has been compounding unobtrusively in the background.

But even if you only start contributing extra now, you still have nearly twenty years before you can access your superannuation account. That is, assuming the government doesn’t change the rules and we will be able to withdraw our funds at 60 years of age.

So there is still time for our money to compound. I know it is not as good as if you had invested all the way since your 20s. But let’s be positive – we are able to contribute more based on our higher wages. Bear in mind though, that the annual maximum contribution is now $25,000 – that includes your employer’s compulsory contribution.

We have no more time to lose.

So check your superannuation balance now and take steps to consolidate accounts if you have more than one. Work out how much your employer is contributing on your behalf. Is it close to $25,000? What is the shortfall?  Divide this shortfall amount by the number of pay cycles left in this financial year. Then work out with your HR department what your new take home pay is if you were to salary sacrifice this amount to superannuation each pay cycle. Even if you can’t contribute the full amount, start with some extra payments and gradually increase it every few months.

I plan to maximise this and ensure I contribute the $25,000 maximum until I stop working. My 70 year old self will thank me later, just as I am thanking my 25 year old self now.

Retirement is Looming in your 40s

Whether you like it or not.

Whether you are prepared for it or not.

This definitely focuses the mind. In fact, it was retirement anxiety that started me on this path. Having a deadline forces me to take action, to do something. It’s all very well to read a myriad of blogs and listen to a plethora of podcasts on financial independence or retirement. But nothing changes until I take action, no matter how small.

I am Wiser in my 40s

At least, I hope so.

Actually, I know so.

I am not sure that I would have embraced the FIRE philosophy in my twenties  – I was too absorbed in living the good life whilst working very hard in my career.

Now, in my late forties, having lived many experiences from travelling around the world to starting my own business, I am ready to dive into FIRE.

I am much more introspective now than at any other stage of my life. This has led me to examine my current life and in turn led me to discovering and pursuing FI.

In my 40s, I am oh so aware of my strengths and weaknesses. Of my ability to work hard. Of my desire to always be learning new things. I know that I am a capable woman, not through positive thinking alone but through my own history of past experiences.

Yes, while I have also built up a lifetime of habits, some of which may not be conducive to achieving FI, I also know that I am capable of change, of renewal. For example, I am aware that I spend money when I am bored and also when I am stressed. So I am learning now to delay that impulse by 24 to 72 hours. I just have to develop a new habit. And learn everything I can about intentional spending and minimalism. Oh, and maybe reducing that stress in the first place!

I know I am a good saver, especially when I am saving towards a specific goal eg travelling. I am not so good at investing, being too intimidated in the past to delve into various strategies. But knowing my money story and having reflected on my attitudes to money & wealth creation, I understand my risk appetite and what sort of an investor I am. I know that stability and security is deeply entrenched in my psyche.

Now, how can I use all this self awareness and knowledge to achieve FI?

Final Thoughts

While pursuing FIRE in our 40s may be seen as a disadvantage by some, I believe it is absolutely not too late to start taking control of our finances.

There is no need to beat ourselves up for past financial mistakes or lament the time lost.

We just have to apply all we know and the lessons learnt from our own past experiences.

And embrace new challenges, develop better habits and crush FIRE.

The principles and steps to get to FIRE remain the same – if the 20s and 30s can do it in ten years, why can’t we in our 40s?

Is your age stopping you from pursuing FIRE? Do you think you are too 'old' to pursue FIRE?

45 Replies to “Why 40s is the PERFECT time to pursue FIRE”

  1. Thanks for the article. Love the Australian slant. Your point on sort is a good one. I’ve been avoiding super for a while now, but have recently give all in. Access is 19 years away. But that will fly by. The tax benefits are awesome. The govt gives you 39c (depending on income) for every $1 invested, as you said up to $25k including SG. That tax refund can be ploughed straight back into non-super investments, therefore potentially shortening the time to retirement by a few years. Your 70 year old self will definitely thank you.

    1. Thanks Dan – glad you enjoyed it. Yes, didn’t dwell on tax benefits of superannuation. Most of us are guilty of ignoring superannuation – it’s hard when turning 60 years old seem so far away and there are competing uses for that money – mortgage and travelling in my situation.

  2. Thank you for your sensible words. I’m only in my early 30s but due to house purchase reasons probably won’t really get investing until mid 30s. I’m always kicking myself for the lost years of compounding investment growth in my 20s but I have to be practical and accept that I can’t change the past and am doing a damn sight more than most my age (and most in their 40s).

    1. Congratulations on your house purchase! No, you can’t change the past but you are aware of what needs to be done to progress further so well done! It’s the ‘hard slog’ phase now but with patience and perseverance, results will naturally follow. All the best!

  3. I agree. While I wish I’d started some habits earlier (especially investing), finding FI in my early 40s worked out well. I try not to look back in regret since that’s pointless anyway.

    I have a better idea of what I do, and don’t, want out of life. The earning power is a big one – we can push really hard now. If we’d started earlier, we’d probably be financially independent about now. But, we can get it done in 5 – 7 years, instead. Either way, life is good!

  4. I could relate to a lot of what you write here. I know myself better than I did when I was younger and I am motivated now–why not use those things to my advantage. Will you have a pension from your employer when you FIRE?

    1. No, it is not common in Australia to get a pension from employers unless you work for the government. I have my retirement account (superannuation) which should grow to two thirds of what I need to FI so my priority is to build up investments outside of superannuation.

  5. I really like what you said about knowing yourself well in your 40s. I also find that I’ve really lost the shopping bug. In my 20s, I sometimes went shopping recreationally, but now I can barely stand it. Part of it has to do with what you mentioned — valuing quality over novelty.

    I look forward to reading more about your journey to FIRE!

    1. Yes, I shopped recreationally in my 20s too and ended up with stuff in shopping bags that I never even use. Then I decluttered a few years ago and realised how much stuff I have. Mind you, I still have more to get rid of. Thank you for your support 🙂

  6. Love this post!

    I stumbled upon the FIRE concept in my mid-40s.

    At the time, I was happy with life, happy with my job. Happy to continue working until I could draw state pension (at 67) because I didn’t know any different.

    Except that the concept blew my mind as it suddenly meant that it was possible for someone like me (ie not a millionaire!) to retire early if I wanted to!

    The ‘FIRE Movement’ has largely been taken up by people in their 20s – I’ve enjoyed a 25+ year career but all I can think of is that they could be missing out on the benefits that a long career could provide, which is not monetary – I’m talking about friendship. My oldest and closest friends started off as colleagues but are now life-long friends of nearly 20 years (and counting).

    I’m the same as you, I know for a fact that had I come across FIRE in my 20s, I would have just dismissed it – too busy spending money to think about the future, am definitely wiser in my forties!

    When I pull the plug (hopefully) by my mid-50s, it won’t be extreme early retiring but as I’ve found with getting older, I just don’t care what other people think! 🙂

    All the very best with your journey to FIRE!

  7. Thanks, Weenie! We must have been very lucky to work with and connect well with our colleagues because I too can count several very good friends that started off as colleagues. All the best on your FIRE journey too!

  8. I’m mid 40’s and started my journey to FI about 6 years ago. I definitely wish I had captured the compounding time of my 20s & 30s. But I wouldn’t have all the great memories of somewhat irresponsible money spent on travel and experiences. Getting a late start brings the end goal into much clearer focus. It is much easier now to delay gratification and not feel any pressure to be a consumer like some of my peers. I also feel like my career has been an important part of my life, not just “10” years of earning and saving as much as possible.

  9. Pingback: Why 40s is the PERFECT Time to Pursue FIRE ⋆ Camp FIRE Finance
  10. Well said, Money Mechanic! I too treasure my past travel experiences (with many to come!). And value lessons learnt in my long career including resilience and interacting with people from all walks of life. Plus life long friendships formed with my colleagues is priceless.

  11. It’s great to find others who have discovered FIRE later in life – I am 49. We are never going to be 20 again, so there is no point beating yourself up about all those lost years, but you can, as you say, maybe retire a little earlier, or even just have a more comfortable retirement when you do get there as from this point forward you’ve been careful with your money. Good luck. Look forward to following you on your journey.

  12. Great to see someone the same age as me talking about FIRE. I’m in the UK so things might be slightly different for me here.
    Six years after a divorce I’m finally debt free, still have to clear the mortgage which i had to start from scratch on 2 years ago, but the plan is to clear the remaining 80,000 in the next 5 to 6 years which will bring me to about age 53.
    I’m a civil servant but have a great side hustle – I’m a juggler / performer which has always been about 1/3 of my income.. I’m currently only putting 100 a month in to my stocks and shares ISA as i focus on clearing the mortgage. Do you think that’s the right approach or should i be putting more in to the investment ?

    1. Congratulations David on being debt free except for the mortgage, yay! And a juggler – how cool is that?

      This is always THE question – clear mortgage or invest? I reckon you can do both. Some say that it makes more sense mathematically to invest rather than pay off low interest mortgage but for me personally, low interest was still interest. And psychologically, I wanted to be secure, to have a place to call home that no one else could evict me from. So I focused on mortgage repayment. But while I was doing that, my employer was contributing towards my retirement (in my superannuation account) even though I didn’t contribute anything extra. So my retirement nest egg was still growing.

      I’m not a professional financial advisor – these are my opinions only. My consideration would be how much you already have in your retirement savings; if 100 a month is all that you can afford right now, then so be it. Retirement timelines can be adjusted – peace of mind and being able to sleep at night is priceless. Don’t forget to save for an emergency fund too – comes in handy so you don’t incur extra debt.

  13. Excellent article. You could have been writing about me. When we start thinking about fire, we feel so alone and ‘different’ but in reality, there are many like us who have experienced the same or similar feelings, frustrations, and emotional journeys.
    Very happy to have found you and look forward to following!

  14. Welcome aboard!
    I’m relieved too that there is a community of late starters in our 40s pursuing FIRE. Sometimes it seems everyone else is young and has already made it 🙂
    Thank you very much fore reading.
    Looking forward to sharing our journeys together

  15. I completely agree with you about the side hustles. It seems to be popular to be overly busy these days but certainly not healthy. Focusing on your career could potentially earn more than a side hustles.

    Forty is still young 🙂

    1. Except in these uncertain times of the pandemic, maybe having side hustles or another income source would be helpful. But I know in my own circumstances, fitting in a side hustle while holding down a demanding job would push me over the edge.

  16. Two things really stood put for me here.
    One is how you know yourself better in your 40s and the other was delayed purchases.
    Both are so true. Both of these give the maturity and perspective required to stay the distance to get to FI. There was no way I could have done that in my 20s and 30s.
    This concept of later FIRE is so valuable. Thanks for raising awareness.

    1. I still struggle with delayed purchases – it’s just that I no longer want so many things so my overall purchases have decreased. But when it’s something I want, I struggle with delaying the purchase.

  17. Great to see encouragement for people to start FIRE at any age. Any one can start from scratch and retire in 10 years if they can save 65% of their income. Or within 20 years if they can save 45%.

    FIRE doesn’t just have to be a thing for 20 year old white male software engineers after all. 🙂

    It’s very true that you know yourself better as you get older. Never underestimate a 40-something year old !

  18. Just found the blog and enjoying it.

    A short note – 25,000 is the cap for concessional super contributions, but on top of that there is the 100k cap for nonconcessional. Not as immediately attractive but there are still the tax benefits of it being within super. The older you get (and the higher your salary) the more likely nonconcessional contributions will be useful.

    1. Hi Edie, that is true – there is the 100k per year for non concessional contribution. In my situation, I would like to retire before 60 if I can, so I need to invest outside of super as well. But the tax benefits of investing in super is hard to counter

  19. Fantastic read! And so encouraging!
    I am 41 and my wife and I target Financial Independence by end 2024 (at the latest 😊). We have two kids and I agree with you, the fourties are just the perfect time to make that major changes in our life!

  20. I think I read this blog last year, we are early 40’s and only just starting our FIRE journey. We have had a few bad choices made in financial investments over the years so it is time to “start again” and get this sorted. We are currently looking at purchasing a small property for cash, then plough all our high incomes straight into share market with 100% of my husband’s wage being invested and approx 20%+ of mine being invested as well. I have estimated for us to Lean fire before we are 50 it will take us 5-7 years, 5 years for my husband and 7 for myself. My husband works 7/7 roster so realistically he could keep on working a bit longer if he should wish but it would be nice for us to FIRE before 50 which see’s the last of our children finish high school. With a fully paid for house and extra going into Superannuation over this time, I estimated that when we can access our super at 60 we will be fat fire at that time and able to pull a bit over $100k at this time. I am reading so much and listening to so many podcasts at the moment to keep me motivated, no more radio on the way too and from work only listening to podcasts.

  21. Welcome aboard! Good for you for starting! I remember how overwhelming it was at the beginning – it was information overload 🙂 But keep taking action, no matter how small and you will get there eventually. Sounds like you have a good plan going forward

  22. I just learned about your blog today from a FB post. We’re about the same age and I also discovered FIRE in my late 40s, so I can relate to your journey on so many levels. Looking forward to reading your blog and taking a parallel journey here from the states.

  23. Welcome, Eric! I never realised there were so many of us who discovered FIRE in our late 40s until I started writing about my own journey 🙂

  24. Such a great read, and one that resonates as an individual in his 40’s learning about the concept. It is motivating to say the least, and yet another great reminder to focus on what matters today and in the long run for a healthy, happy, and financially secure life. Perspective is the great equalizer, thank you for sharing!

  25. You are most welcome, Shane and welcome aboard!

    We do have advantages over the youngies 🙂 Check out the stories in the Late Starter to FI series – they are really inspiring!

  26. Wonderful article. I look forward to reading more! I too discovered FIRE in my mid-40’s, at the same time as career burn-out funnily enough… Is there a pattern?? There may be a relation between FIRE and job dissatisfaction. Also, I spent money with gleeful abandon on travel to lots of countries in my 20’s and 30’s. Now I find the travel bug is gone and perhaps I have ‘retreated into my shell’ a bit more. FIRE just would not have appealed to me then the way it does now.

    1. Hi Jeff,
      There is probably a correlation between career burnout, mid 40s, FIRE and general job dissatisfaction … we’re at that age where we have low energy to change what we are doing but it’s unbearable to continue on our current path and we start to look for solutions. It’s funny that pursuing FIRE isn’t just about money in the end but about looking at our priorities in life and what we truly value. Yes, I spent money with gleeful abandon too in my 20s and 30s, haha – and now it’s time to buckle down and save for my retirement 🙂

  27. Hello and thanks so much for your blog! I’ve literally just discovered FIRE and I’m in my late 40s. I spent my 20s working abroad and travelling around Europe, and my 30s bringing up my kids. Until now, I never had much spare dough. I always spent my money on travel and I don’t regret it at all – having had amazing, unforgettable experiences along the way. Now with Covid, my travel bug has subsided, and with age I find myself disinterested in buying stuff. I finally feel ready to get financially sorted, and I can focus on it 100%. I’ll be following your journey for sure 🙂

    1. Hi Liss,
      Welcome aboard! It is absolutely not too late to embrace a FIRE lifestyle in our 40s and eventually retire earlier than we thought we could 🙂 Maybe post Covid, your travel bug will emerge again but in the meantime, it’s a great time to reassess goals and save towards them. I haven’t stopped putting money aside for travelling – it’s just quietly building up in the background

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