Definition
Fat FIRE
Fat FIRE is financial independence achieved with a large corpus that supports a comfortable or even affluent lifestyle without compromising on spending.
Because the target is to fund a generous standard of living, the required corpus is far bigger than for lean FIRE — many multiples of one's already-high expenses. Reaching it usually demands a high income, a strong savings rate sustained over a long period, and substantial equity exposure to grow capital.
Fat FIRE provides a thick cushion against inflation, medical costs and lifestyle changes, making it more resilient than leaner approaches. The downside is that it takes longer to accumulate, so many pursue it alongside a high-earning career rather than the extreme frugality associated with lean FIRE.
Related terms
- Retirement CorpusA retirement corpus is the total lump sum you need to have accumulated by retirement to fund your living expenses for the rest of your life.
- Financial IndependenceFinancial independence is the point at which your investments and passive income can cover your living expenses, so working for money becomes a choice rather than a necessity.
- Lean FIRELean FIRE is a version of financial independence built around a frugal, minimalist lifestyle, requiring a smaller corpus because annual expenses are kept low.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.