[Namsan Ddalggakbari] 20 ‘FIRE Joks’ Who Achieved ‘Economic Freedom’ Before Age 40

[Asia Economy Reporter Seomideum] The term FIRE refers to people who achieve financial independence, retire early, and enjoy the rest of their lives. It is an acronym derived from the English phrase "Financial Independence, Retire Early." So, what is the benchmark for the FIRE lifestyle? Many people cite a monthly income of 5 million won, 25 times annual expenses, or a net worth of 2 billion won. Kang Hwanguk, author of "FIRE" (Page2 Books), joined the ranks of the FIRE community at age 38. After 12 years at KOTRA, known as a "dream job," he resigned and now enjoys life as a full-time investor, investment YouTuber, and investment instructor.

The book "Rich Dad Poor Dad" planted the seed of "financial freedom" in the author. To summarize the core message: "Financial freedom is important, but it cannot be achieved by studying hard at school and working hard at a job." It emphasizes that knowledge of investing, markets, law, and accounting is paramount.

Having lived in Germany for about 13 years during his childhood, he first earned money through chess. After returning to Korea and serving in public service, he pondered ways to make money and chose to teach chess. He spent about 100,000 won monthly and saved the rest to build seed money. Starting in 2004, he began studying stocks and engaged in quant investing (making investment decisions based on quantifiable data), earning some profits between 2005 and 2007. Although he suffered a 25% loss during the 2008 financial crisis, he had already accumulated 25 million won from chess lessons and investments before becoming a salaried worker.

After discharge, he joined KOTRA in 2009 but never aimed for promotion from the start. "I saw it merely as a gateway to financial freedom and a means to accumulate seed money." He set his monthly expenses at 300,000 won and saved or invested his 1.9 million won salary, accumulating 50 million won by the end of 2009.

In 2010, he also ventured into site visits. Following an auction mentor, he toured various locations nationwide and successfully bid on three apartments in remote areas of Yesan County, Chungnam Province. He sold them in 2011, achieving a considerable return.

The author says the hardest part is making the first 100 million won. This is because among spending less, earning more, and investing, spending less is the most effective at this stage. Living with his parents to minimize expenses, he earned 130 million won within three years of joining the company in 2012.

There is a golden rule for principal preservation: spend only 3-4% of net assets. Following this, he lived as an expatriate in Germany for four years and returned with 530 million won. Of course, the overseas living allowance and an annual salary exceeding 100 million won including bonuses were crucial. By minimizing expenses and focusing on quant investing, he was able to accumulate wealth quickly.

One tip the author shares is to "repeat activities that yield huge success if they go well but cause minimal damage if they don't." One such activity is writing books. In 2017, he published "You Can Do It! Quant Investing," sharing his quant investing know-how, which received great acclaim. Besides royalties, he received numerous requests for lectures and talks, generating additional income. The advantage of content business is that even if it doesn't succeed, the damage is minimal. Although sales of his 2018 book "Magic Formula for Cryptocurrency Investment" were poor, he said, "I lost time and energy and felt drained, but the financial loss was almost none."

The author found great comfort in the words of Shin Sangcheol, CEO of MoneyMan: "90% of the market is not our competition from the start. The way to survive in the market is very simple. Just keep doing something steadily every day and endure. Being consistent is special in itself, and less than 10% of people can be that diligent." By establishing a virtuous cycle of book-SNS promotion-lectures, he reached 1 billion won in assets in 2018. In 2021, after accumulating 2.9 billion won in net worth, he achieved FIRE.

The author’s secrets to successful investing are: ▲ invest only in thoroughly verified strategies ▲ never change the strategy during execution (because there can be 2-3 years when the strategy does not work well) ▲ invest about 5% of assets in "all or nothing" ventures that have low downside but high upside potential.

So when should one quit their job? ▲ when a new job is confirmed ▲ when you have earned at least 25 times your annual expenses ▲ or when you are actually earning money from side jobs.

While saving is the best way to build seed money, there are various ways to grow the money saved. Some people accumulate tens of billions through real estate or stock investments while working as employees, some become wealthy by starting their own businesses, some become rich through full-time investing without a job, and some emigrate to countries with low living costs for FIRE. The book contains success stories of 20 FIRE individuals.

FIRE | Kang Hwanguk | Page2 Books | 428 pages | 18,000 won