Why Flamingo FI?

As I continue down this road of blogging in the personal finance space, one of the top things I hear from readers and others I connect with is that they’ve never heard of Flamingo FI (financial independence) as an alternative FIRE strategy before. So today on the blog, I thought I’d share what exactly Flamingo FI is, why it is my chosen FIRE strategy currently, and why it may be a good option for you too.

Recently, I had the opportunity to be a guest host on one of my favorite finance podcasts, Martinis and Your Money. And on this episode, I had the good fortune of getting to talk about one of my favorite money topics: alternatives to the traditional FIRE (financial independence, retire early) strategies. If you’d like, you can listen to the episode here. The other ladies on the podcast with me had heard of many of these strategies like Coast FI, Barista FI, Fat FI, and Lean FI. But when I told them that my favorite strategy, and the one I was choosing to pursue, was Flamingo FI, I got lots of oohs and aahs. None of them had heard of this strategy before!

So what, then, is this elusive Flamingo FI strategy? Well, the term was coined by the Australian blogger behind Money Flamingo. I have enjoyed her content SO much over the years, and it has been so inspiring to me on my journey (as you can tell from this post). I highly recommend you check out that blog, especially this post on Flamingo FI, if the content of my blog and especially this post resonate with you.

But for today, I’m just going to give you the basics behind Flamingo FI so you know why it’s my chosen strategy, and in case it might be something you want to consider on your own personal finance journey.

Flamingo FI is very similar to Coast FI, which most people in the FIRE space typically have heard about. The two strategies are similar in that they both refer to different stages of money accumulation before reaching full FI. The definition of full FI, in its most basic form, is having 25 times your yearly expenses saved in investments.

Where they differ is that Flamingo FI and Coast FI are calculated differently.

Coast FI is the point at which all the money you have saved in investments, if left to grow without contributing any more money, would grow to become your FI number (25x yearly expenses) by the time you reach traditional retirement age. So your Coast FI number is the dollar amount saved in investments where you could technically take your foot off the gas, stop saving, and only cover your expenses until you retire.

You can calculate your Coast FI number with this handy calculator, thanks to the bloggers behind The Fioneers. Note that the calculator actually allows you to put in any age as a target, so you could technically have a Coast FI number for retiring at 35, 40, 50, etc. You don’t have to want to retire at traditional age (60-65 years) to embrace Coast FI. But, if you want to reach FI at a younger age, you’re Coast FI number (and thus how much you need to save) will be higher than it would be if you were going for a traditional retirement age.

With that said, depending on your age and when you want to retire, your Coast FI number could actually be quite small and achievable, which is why I think so many folks in the personal finance space have gravitated toward Coast FI (and alternative FIRE strategies in general).

And absolutely, Coast FI is attractive and has worked for many folks. If you’re interested in Coast FI and haven’t heard much about it, I recommend you check out The Fioneers blog and also The Coast FI Guy.

But now, enter the devil’s advocate. Enter, Flamingo FI.

Your Flamingo FI number is only slightly different from your Coast FI number. I’ll admit, it will likely be a higher number, but it is much easier to calculate.

Your Flamingo FI number is simply half of your FI number.

If your FIRE number is 1 million dollars, Flamingo FI is half a million dollars. Yep, that’s it folks. Take your FIRE number, divide it in half, and there you have it.

And, in case you’re wondering, it’s for this most simple of reasons that Flamingo FI got its name. Flamingo FI is like FI standing on one leg; hence, like a flamingo.

As I alluded to above, your Flamingo FI number is likely going to be higher than your Coast FI number (unless you’re way closer to your full FI number than you think). This is one of its downsides when considering options for alternative FIRE strategies.

But another way to see it is that Flamingo FI gets you a little bit closer to your actual FI number than Coast FI takes you. A little bit closer to full financial freedom.

And once you are there, once you’ve hit your Flamingo FI number, the next steps of both Flamingo and Coast FI basically become one in the same.

You can stop contributing to your investments, and only cover your living expenses. If you want to.

You could downshift to part-time work, working less in the job you already have. You could go out on your own and do the work you already do but on a freelance basis, losing the employer and maybe some benefits but gaining more time and schedule freedom. Or, you could switch gears and do something completely different for work that you’ve always wanted to do that maybe pays less but will still cover your cost of living.

Basically, you could take more risks with your working life. If you want.

And since you will have done more of the work (saved more toward full FI) if you take a Flamingo FI approach, you are likely to hit full FI earlier with a Flamingo FI strategy than with a Coast FI strategy if you don’t save any more of your income.

As I mentioned above, the bare bones type of Coast FI will get you to full FI at traditional retirement age (60-65 years).

With Flamingo FI, thanks to the rule of 72, you are likely to reach full FI much sooner (depending of course on what age you hit Flamingo FI).

The rule of 72 tells you how long it will take for your investments to double. You take the annual rate of return on your investments that you expect. Then, you take 72 and divide it by that number.

So if we go with a relatively conservative rate of return of 7%:

72/7 = 10.29 years

With Flamingo FI, that means your money, with an expected rate of return of 7%, will double in about 10 years. Since Flamingo FI is half of your FI number, when your money doubles, you will have achieved full FI.

Said another way, if you hit your Flamingo FI number at 40 years of age, you can expect to be full FI around age 50.

Even if we use a more conservative 5% rate of return, the years it takes to double our money is a little over 14 years.

So if Flamingo FI and Coast FI have similar end games (only needing to make enough money to cover living expenses), and yet Coast FI is a much smaller number and thus easier to achieve, why do I prefer Flamingo FI?

I’ve alluded to some reasons above, but let me take it deeper.

Flamingo FI might be for you if…

It’s not that you don’t want to work, you just want to work less

If you’re a regular reader of my blog, you likely know my story. I used to be squarely stuck on the hamster wheel, chasing someone else’s version of success (because I had no idea what my own definition was).

I grew up a straight-A chasing, goodie two-shoes who just wanted to be the best at everything. That spilled over into college, into a graduate program, into a prestigious postdoctoral fellowship, and then into my “dream job” as an Assistant Professor in a perfect location. I had it all. I had everything I wanted.

Or did I?

You’ve heard it before. If not from me, from someone else’s story. The dream job didn’t end up being the dream job. I found myself lost, stressed out, and anxious to the max. I had been living on autopilot, chasing a dream I thought I wanted when I had never stopped to consider what it was I actually wanted my life to look like. What I actually valued, what made me come alive.

When I first left that Professor job, I was still so lost. I didn’t want to leave my perfect location (spoiler alert, it’s where I live currently: Vermont). I tried freelancing. I loved the freedom I had in my days, but I was still only one foot off the hamster wheel. I craved stability. I desired a 401k, employer-sponsored health coverage, and a steady, predictable paycheck.

So, I took a remote job as an editor that was a huge paycut compared with my professor job. But with that decrease in pay came an increase in time.

The longer I was at that company, and the more I learned how to be proficient in my role, the more efficient I became. For the first time in maybe my life, I had a job/a way to spend my days that 1) didn’t take much more than 35 hours a week and 2) didn’t take much mental energy. Don’t get me wrong, I love editing (sometimes I think about going back), but when you’ve lived in the world of academia, editing all day every day feels mentally freeing.

This job changed my life. Because I wasn’t working all the time, AND when I wasn’t working I wasn’t thinking about work, I had all this extra time and space in my day. Time and space to think, to explore my curiosity and creativity, to learn who I was outside of work. And I realized for basically my whole life up to this point, my identity had been wrapped around my work. There was a whole other side to me I had never explored (at least not since I was a kid). A creative side just waiting to be set free.

It was around this same time I discovered the concept of slow FI, and the rest is history.

From there, I started to keep a list of things I wanted to try if I had more time. Things that sparked my curiosity, that I wanted to experiment with to see if I liked them as much as I thought I would. This list became what I call my Financial Freedom List.

And then I made a plan to eventually downshift to part-time work so I could make more time for the things on that list. Because it wasn’t that I didn’t want to work (I actually really like the work I do). It’s just that I didn’t want to do it so much. I wanted more time to explore my curiosities.

I think for many of us who are on this path to FI, it’s not that we don’t want to work at all. Sure, a life of vacation from work may be the end-all-be-all for some (and if that’s you, good for you!). But I know of many others, myself included, who don’t imagine ourselves not working at an early age. We just crave the ability to work how we want to work. To perform work that lights us up, that makes us fly out of bed in the morning.

So, Flamingo FI might be for you if you want to work less because you know how you’d spend your days if you weren’t working full-time, and you want that sooner rather than later.

I can already hear you now. “Mrs. Dink, didn’t you just tell us that Coast FI is a lot faster and easier to achieve? And it would still let us take our foot off the gas? So why not Coast FI?”

Ok, you got me. If you really love your job, and you really just want to work less, then Coast FI may be for you. But let me give you some other reasons.

Flamingo FI might be a better option if…

You struggle with the golden handcuffs

I know myself, and I struggle a ton with those damn golden handcuffs. I’ve written about it before, but one of my biggest hurdles to downshifting to part-time work is knowing what I’m leaving on the table. It’s so hard for me to think about giving up my salary, my employer-sponsored health care, my 401k match.

I’ve done a lot of work to increase my salary back up (to beyond what I was making in that dream Professor job) in a way that works for me. In a way where I’m not burned out, working crazy hours.

No matter what I tell myself that I know to be true, that I’ll likely make just as much in half the time if I go freelance, that I don’t need to save anymore because I’m Coast FI, I still always come back to the golden handcuffs.

One of the big reasons Flamingo FI resonated more with me than Coast FI is that it provides more of a cushion. Simply having more in my investment accounts before I downshift just feels better in my body.

So if you want to downshift but struggle with golden handcuffs, Flamingo FI might be a good alternative FIRE strategy for you.

Flamingo FI might also be for you if…

Coast FI feels too risky

Or too scary. Or leaves an uneasy feeling in your stomach.

This one is similar to the golden handcuffs, but goes a bit further. If this is you, you’re not only struggling with all you’d give up by downshifting, but you also have actual fears about running out of money. Or about making it work, covering your expenses, by just coasting. Or about not saving.

For me, it feels weird and scary to NOT save when I’ve been a saver my whole life. I know that’s going to be something I struggle with when I downshift (even if I’m still able to save a little, I don’t want to rely on it). And so for me, Flamingo FI feels a bit more secure.

I’m overall risk adverse, so Coast FI felt a bit scary to me. When you hit Coast FI, and you see how much smaller the number is than your full FI number, it might feel scary. But ultimately, if that number is quite low, it’s because you have lots of time for that money to grow and compound before the age you want to retire.

And it makes perfect sense to be scared, let me assure you. Many of us on this FI journey struggle with trusting the process. Trusting the math. Because it’s so against the norm. And for awhile, there weren’t many other people doing it. Heck, I’ve read blogs of people who reached FI and still couldn’t get off the hamster wheel. I think many of us fear running out of money, even when we know it’s not likely to happen.

If this is you, if Coast FI feels too risky, Flamingo FI may feel like a more reasonable option (even if it still feels risky).

Flamingo FI might also be for you if… 

You split finances with your spouse/partner

I’ve written a whole post about how Mr. Dink and I manage our household finances. In short, we keep our financial houses separate, and we each contribute our individual money to the household. This works for us because we don’t necessarily think of it as separate (it’s still “our” money even though we technically manage it separately) and we talk about money ALL the time (we also have regular “official” quarterly money dates).

If it was just me, and I was the only one in the driver’s seat, I may be more on board with Coast FI as an alternative FI strategy. But for me, I like the security Flamingo FI brings for us as a couple.

Coast FI may make me, personally, feel secure.

But Flamingo FI gives me, and our family, a little bit of a cushion. I like knowing that I’d be a little bit farther along in my FI journey before downshifting so that I could better take care of our family if, God forbid, anything happened to Mr. Dink. To me, it’s like having a little bit more insurance than I really need. It’s peace of mind.

What’s also kind of cool about splitting finances (at least for me) is that because we know all the ins and outs of each other’s finances, I not only have a Coast FI and Flamingo FI number for myself, I also know our Coast FI and Flamingo FI numbers as a couple.

Even though Mr. Dink doesn’t ever expect me to support him, it’s nice seeing that I could if I wanted or needed to.

In case you’re curious, with my investments alone, I have hit my personal Coast FI number and our Coast FI number as a couple. The next milestone is my personal Flamingo FI number. This is where I’ll consider downshifting, because to me it feels like the safest place. It will give me the most peace of mind while still feeling like I’m taking my foot off the gas way before hitting full FI.

And finally, Flamingo FI might be for you if…

There’s something else calling to you

Is there something you daydream about more often than not when you’re working? Something you dream about doing just before you fall asleep at night? Something that makes your heart flutter a little bit every time you think about it? Something pulling at your insides in a way you’ve never felt before?

And is this something not only calling to you, but something you don’t want to feel pressured to make money from?

Many of the things on my Financial Freedom List, if I had to rely on them to provide me with income, I think would not bring me as much joy as they could.

Am I open to them bringing in money over time? Of course. But what I really want from downshifting is the complete freedom to explore these ideas that are calling to me, fighting for my attention. With no strings attached.

If any of this sounds like you, but you struggle with some of the above (golden handcuffs, fear, etc.), please don’t wait until you hit full FI to start exploring these feelings.

There are other options. And Coast FI is a good one. But if Coast FI feels too risky, I challenge you to consider Flamingo FI.

You may be standing on one leg, but I promise you, you won’t tip over as long as you stay true to yourself and follow your own path.

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What do you think? Have you heard of Flamingo FI before? If not, would you consider it? And if it’s your chosen strategy as well, is there anything you’d add to this list? I’d love to hear your thoughts!