StrategyFIRE glossary
Defined termPassive Income
Income that continues without active work: dividends, interest, rents, royalties. Less common in early FIRE (most rely on portfolio drawdowns), but a popular parallel path.
Did this definition help?
Related terms
More from Strategy
Savings Rate
(Income − Expenses) ÷ Income. The single most important variable for years-to-FIRE. A 50% savings rate reaches FIRE in ~17 years; a 20% rate takes ~37.
Bucket Strategy
Splitting retirement assets into three "buckets": short-term cash (1–2 years), medium-term bonds (3–10 years), and long-term stocks (10+). Refill each bucket from the next one in good market years.
Sequence of Returns Risk
The risk of bad market returns in the first few years of retirement, which can permanently damage your portfolio even if average returns are fine. Mitigated with bond tents and cash buffers.
Lifestyle Creep
Letting spending rise every time income rises. The silent killer of FIRE timelines — raises should fund investments, not bigger cars.
Need another definition?
Jump back to the glossary index to search every FIRE term, filter by category, or keep browsing alphabetically.