The FIRE movement, Financial Independence Retire Early, has also started to gain popularity in the Italian context, offering a new perspective on retirement and financial independence. Born in the USA and popularised by Vicki Robin's book 'Your Money or Your Life', FIRE calls for intensified saving, up to 50 per cent of your salary, and investing your money. In Italy, this approach is confronted with a unique economic fabric, marked by a strong social security system and peculiar tax advantages.

What is the FIRE movement?

Financial Independence, Retire Early (FIRE) is a lifestyle and financial movement that aims to accumulate enough income to cover expenses for the rest of your life, allowing you to retire early. This is achieved by saving and investing a high percentage of your income by living below your means to minimise your expenses. The ultimate goal is to live off your savings and investments without having to work.

The adherents of the movement are unhappy with the seemingly arbitrary retirement age imposed by governments. They calculated that it is possible for most people to retire before the age of 67, even if they don't earn a huge income, simply by adopting good financial habits and being in control of their financial life. This mentality is particularly resonant in Italy, where the savings culture is already part of the national DNA.

The FIRE principles adapted to Italy

FIRE is based on the principles of spending less and making common sense investments. The first step is to live frugally, cutting non-essential expenses to increase one's savings. Next, the accumulated capital should be invested intelligently, favouring instruments such as market indices, which have historically guaranteed solid returns.

To give an example of how much more is saved for the FIRE philosophy, while in Italy conventional pension plans are typically based on saving 10-15% of net income, thus leaving €85-90 to spend on every €100 earned, the FIRE movement proposes a radical change. Those who adhere to this philosophy aim to save as much as 30-50% of their salary each month. Not only does this strategy significantly increase the share of income saved, but it also requires careful attention to one's spending habits and a long-term commitment to achieve financial independence sooner rather than later.

Another key is investing in index funds or ETFs, which allow you to diversify your risk and minimise your management costs, thus enhancing your chances of accumulating the assets needed for early retirement.

In concrete terms, the path to financial independence and early retirement consists of eight essential steps:

  1. Understand what FIRE means
  2. Set clear financial goals
  3. Budget and save
  4. Invest well
  5. Generate passive income
  6. Stay disciplined
  7. Adjust as necessary
  8. Retire!

Let's explain each one!

1. Understand what FIRE means

Educate yourself about personal finance, investments and the FIRE philosophy. Knowledge is crucial for informed decisions.

2. Set clear financial goals

Define what financial independence means to you. This could be having a certain amount in savings, being able to live off passive income, or a combination of both. Determine what your living expenses are and how much money you would need to cover these expenses for the rest of your life.

3. Budget and save

Create a budget that outlines your income and expenses, and stick to it. Try to save as much money as possible, often upwards of 50% of your income. You can achieve this by living frugally and reducing unnecessary expenses.

This starts with getting visibility into how you spend your money. Track your expenses for a month, for instance through your banking app. Then question each expense: was it a necessity? Did it contribute to my happiness? Can I avoid it in the future?

How much should you save per month to reach FIRE?

The amount you need to save per month to reach FIRE depends on several factors:

  1. Your desired retirement age: The earlier you want to retire, the more you'll need to save each month.
  2. Your current age: If you're starting at a young age, you have more time to save and take advantage of compound interest.
  3. Your expected expenses in retirement: This is crucial to determining your "FIRE number", which is typically calculated as 25 times your expected annual expenses (based on the 4% rule).
  4. The expected return on your investments: This will affect how quickly your savings grow.
  5. Your current savings: If you already have substantial savings, you may not need to save as much per month.

In the FIRE community, it's common to aim for a savings rate of 50% or more of your income. However, the specific amount will depend on your personal situation and goals.

For a more specific estimate, you can use an online FIRE calculator. You input your current savings, monthly savings amount, estimated annual return on investment, and desired annual withdrawal amount. The calculator then estimates when you will reach financial independence.

4. Invest well

Investments are a pillar of FIRE. Index funds are efficient tools to diversify risk and reduce costs. Figure out and take note of the taxes you have to pay as an Italian investor.

5. Generate passive income

This can be through real estate, dividends or royalties, which require little effort to maintain.

6. Stay disciplined

FIRE is a long-term commitment that requires consistent effort and discipline. It's important to stay focused on your goals and not get distracted by short-term market fluctuations. Lifestyle inflation, where you spend more as you earn more, is also a danger to be mindful of.

7. Adjust as necessary

Your financial situation will change. Review your FIRE plan regularly and make the necessary changes.

8. Retire!

When you have reached your financial goals, you can retire, although many choose to continue working on their own terms and timetable.

How to invest to reach FIRE

Investing wisely is the cornerstone of achieving FIRE. Once you save a certain percentage of your income each month, it is crucial to invest that money wisely. Savings accounts, with their minimal interest rates, are not enough, as inflation erodes the real value of your savings over time. In Italy, as elsewhere, financial markets offer the opportunity to make long-term savings pay off. However, investing can seem intimidating for novices, especially when considering the technical complexities and high fees of investment funds offered by banks, which rarely beat the market. Investing through the bank is often not the most efficient way to achieve FIRE, due to the high costs and low returns of savings accounts and actively managed investment funds.

Investing in index funds, or ETFs, is an efficient and low-cost solution, as it aims to replicate the average performance of the global economy, eliminating the need to 'beat the market'.

This type of passive investment has proven to be a winning strategy over time, as evidenced by the historical growth of the MSCI World index. An investment of €10,000 in 1979 in a fund tracking the MSCI World would grow to more than €700,000 today, with an average annual return of almost 10%, much more profitable than a traditional savings account.

Investing in index funds in Italy

Investing in index funds presents itself as an essential tactic for those targeting FIRE in Italy. This approach can be managed in two ways: independently, through the use of a broker like DEGIRO, or through an automated investment app, such as Curvo.

Opting for a broker offers maximum independence in investment choices, but requires a proactive approach and a good understanding of the market to avoid costly mistakes. On the other hand, services such as Curvo offer a guided and simplified path, ideal for those who prefer a 'free hand' approach to investing. Curvo automates the investment process and builds a portfolio based on your objectives and time horizon, while also directly managing the tax component and risk diversification. This is ideal for those who wish to invest without having to immerse themselves in the complexities of the financial market, while still maintaining control over their finances and moving confidently towards financial freedom.


In Italy, aspiring to FIRE may seem impossible, but the various steps you can take to try and achieve the goal are invaluable for anyone wishing to improve their financial situation. Embracing the FIRE movement in Italy means adopting a lifestyle focused on financial efficiency and taking advantage of suitable investment tools, making savings pay off over time, and protecting them from inflation.

Curvo can be a partner on this journey, offering a service that makes investing less complex and more accessible for all those aiming for financial independence, paving the way for a more stable financial future, even in a complicated landscape like Italy.