What Does Islam Have to Say About Retiring Early? (FIRE)

The FIRE movement has taken the personal finance world by storm. 

Social media is flooded with stories of people retiring at 35, living off their investments while sipping mocktails on tropical beaches. It sounds incredible – who wouldn’t want to escape the 9-to-5 grind forever? But as Muslims, we need to ask ourselves: is chasing early retirement actually aligned with our values and our understanding of a meaningful life?

By the way, if you’d prefer to watch instead of read, here’s our video on the topic:

What is FIRE?

FIRE stands for Financial Independence, Retire Early. According to Investopedia, it’s “a movement of people devoted to a program of extreme savings and investment that aims to allow them to retire far earlier than traditional budgets and retirement plans would permit”.

The idea seems simple: save aggressively (often 50-70% of your income), invest wisely, and retire decades before everyone else. The magic number is typically 25 times your annual expenses. So, if you need £40,000 per year to live, you’d need £1 million invested to theoretically never work again.

There are different approaches to FIRE, each reflecting different savings targets and lifestyle choices:

• Lean FIRE is for those willing to keep their yearly spending low, but requires a high level of frugality and higher risk tolerance. 
• Fat FIRE is for those who want a more comfortable and luxurious retirement. It offers more flexibility at retirement and a lower risk of running out of money. 
• Barista FIRE is a hybrid approach, with partial retirement and part-time work. This offers a more balanced lifestyle and a lower overall savings target.

At a surface level, it seems appealing. Who doesn’t want financial freedom? 

But the problem isn’t the goal of financial independence, it’s how FIRE approaches it and what it ultimately represents.

The Problems with FIRE

Let’s be honest about the numbers first. Expecting the average person to save 50-70% of their income is borderline delusional. Most Britons save around 8% of their income. Unless you’re living rent-free with family or earning an exceptionally high salary, these savings rates are simply unrealistic for most people, especially in expensive cities like London.

But the mathematical impossibility isn’t even the biggest issue. The real problem is spiritual.

FIRE essentially teaches us to hate our present in service of an imagined future. As if our current life is so miserable that we need to sacrifice everything now to escape it later. This mindset is fundamentally at odds with Islamic teachings about contentment, gratitude and finding purpose in our daily lives.

Then, consider the isolation factor. You retire at 40 while everyone else is still working. You’re sitting alone on that beach because your peers are all in offices. 

What Islam Teaches Us About Retirement

 Islam doesn’t teach us to view work as something to escape from. The Quran speaks positively about productive labor. The Prophet Muhammad (SAW) was a merchant. The idea that the ultimate goal of life is to stop working entirely contradicts our understanding of human purpose.

The real issue isn’t work itself, it’s meaningless work. If you’re miserable at your job, the solution isn’t to suffer for decades while saving every penny so you can eventually stop working. The solution is to find work that aligns with your values, makes use of your talents and contributes positively to society. You can read more about high-paying jobs that align with your faith in this article.

When you love what you do, “retirement” becomes irrelevant. You might choose to work less as you age, or pivot to different, less demanding types of work, but the idea of a complete withdrawal loses its appeal.

How Should Muslims Prepare For Retirement?

This doesn’t mean we should ignore financial planning. Building wealth is important. It provides security, enables you to be generous and gives you options. But the approach is what matters. 

Instead of extreme sacrifice now for future leisure, Islam encourages balance. Save consistently, but don’t make yourself miserable doing it. Maybe that’s 20-30% of your income rather than 70%, or taking on a side hustle you’re passionate about rather than just cutting expenses to the bone.

Spend money on experiences that enrich your life and strengthen your relationships. Take family trips, perform Umrah, support causes you care about. These investments in experiences and relationships provide immediate returns in happiness, unlike the deferred gratification model FIRE provides.

Consider wealth as a tool for freedom, not an end in itself. Financial independence isn’t about never working again, it’s about having the choice to pursue meaningful work without being trapped by financial necessity. It’s about being able to walk away from a toxic work environment, take time off for family, or pivot to work that pays less but provides more satisfaction.

Islam teaches us to be grateful for what we have today. Yes, plan for the future, but don’t sacrifice present happiness for imagined future bliss. 

What FIRE gets right

None of this means we should completely dismiss FIRE’s insights. The movement gets several things right: the importance of conscious spending, the power of compound interest, and the value of having a financial plan. These are all beneficial practices that align with the Islamic principles of stewardship and planning.

But we can embrace these positive aspects without buying into this idea that work is bad and retirement is the ultimate goal. We can save and invest wisely while also enjoying our present lives, building meaningful careers, and finding purpose in our daily activities.

The key is intention. Are you building wealth to serve Allah better, support your family and contribute to your community? Or are you building wealth to escape from life? 

Conclusion

Instead of obsessing over early retirement, focus on building a life you don’t need to retire from. Find work that energises you, rather than drains you. 

Build financial stability gradually and sustainably through savings and investments that are suited to you (check out our Investment Comparison Page or our Investment Checklist to help get you started). Invest in relationships, experiences and personal growth alongside your investment portfolio.

Remember that true wealth can be about having meaningful work, strong relationships, good health and a strong sense of purpose. Someone who has these things but less money is wealthier than someone who has millions but lacks meaning in their life.

As Muslims, we’re called to a more balanced approach: building financial security while finding joy and purpose in our present, trusting that Allah’s plan for our lives involves both struggle and blessing, work and rest.