Advising the FIRE client: Fan the flames or put them out?

Financial advisors typically recommend saving around 10% to 15% of one’s income for retirement. Alex Kamerman is saving 50%.

That’s because Kamerman, a 35-year-old elder law attorney in New York, subscribes to a movement called FIRE, or “Financial Independence, Retire Early.” Definitions vary, but FIRE practitioners typically try to save so much of their income — up to 70% — that they can retire decades ahead of schedule.

“The less time you have to save, the more aggressive you have to be,” Kamerman said. “I’m basically saving more than what I expect my annual expenses to be per year.”

Many FIRE savers aim to retire as early as their 30s or 40s. Kamerman isn’t quite that ambitious — he aims to retire by age 50 — but that’s still over a decade younger than the norm. The average retirement age for Americans is 61, a recent Gallup study determined. For men in particular, it’s a little higher — 64.7, according to the Center for Retirement Research at Boston College. In both cases, these ages have steadily risen since the 1990s.

Aggressive savers like Kamerman are trying to buck that trend. Why? The motive has a lot to do with the “I” in FIRE: independence.

“I think financial freedom is the best thing money can buy,” Kamerman said. “I highly value being in control of how I spend my time and my attention.”

Read more: 4 tips for rolling over all of your client’s old 401(k)s

But what happens when this freedom isn’t feasible? With a lawyer’s salary, Kamerman might be able to pull it off. But for many others, the FIRE approach may simply not make sense — almost a third of Americans, for example, would have trouble covering a $400 emergency, let alone setting aside half their salaries for retirement.

This raises a tricky question for financial advisors: What should they do when a client is alight with dreams of retiring extremely early? Should they try to talk the client out of it, or do their best to make the plan work? Or is there some other, better approach?

The answer depends on the advisor. Here’s how wealth managers from around the country handle “the FIRE question”: