We're financially independent millennials. Here are 5 tips for Gen Zers who want to do the same.
Katie and Alan Donegan, who retired early in 2019 at ages 35 and 40, started their financial independence and early retirement (FIRE) journey by saving and investing from 2015. They emphasize that compounding interest is crucial and that young people don't need to earn a million dollars upfront—small investments can grow significantly over time. They advise finding a balance in spending: enjoy life without overspending or succumbing to lifestyle inflation tied to status symbols. They recommend maintaining four types of accounts to handle emergencies, planned expenses, tax-advantaged investing, and general brokerage investing. Continuing to learn beyond formal education and focusing on health with a balanced lifestyle are also key to long-term success in FIRE. They stress that financial independence is about more than money—communication, shared vision, and happiness from non-material things are essential to truly benefit from early retirement freedom.
Here is a casual rewrite of their five key FIRE tips for Gen Z:
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Compounding is your best friend. Start investing early and trust that your money will grow over time, even if you don’t earn a million right away.
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Learn to spend wisely. Don’t deprive yourself or skip important life experiences, but avoid the trap of spending more as your income grows just to keep up appearances.
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Have multiple savings accounts: a few months of expenses for emergencies, a fund for upcoming planned costs, tax-advantaged investment accounts, and brokerage accounts for other investments.
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Never stop learning. Education doesn’t end with school. Keep reading, studying, and learning from people who inspire you to grow your skills and money.
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Take care of your health. Follow simple, sustainable habits—eat well, get good sleep, move regularly—and enjoy life without obsessing over perfection.
These insights come from their own years of managing money, facing challenges, and eventually securing financial independence to live their life on their own terms.