Is anyone doing FIRE without being optimal intentionally?

Personally, I think the FI/RE community is overly zealous on Roth accounts. Taxable brokerage is, in my opinion, a much better account with significantly more flexibility while also offering $0 tax draw down strategies (through long term capital gains tax rates). It's also a better way to leave inheritance (step-up in cost basis, no immediate income tax, no required distributions, no mandatory 10 year rule).

I also really dislike the idea of using a Roth 401k account through work, think traditional tax advantaged 401k makes much more sense to significantly more people.

Most people define "optimal" in this context as the fastest way to build up funds and hit FIRE. There are all sorts of optimizations, but a rough summary of the biggest levers would be: Max PreTaxAccts → Max RothAccts →Remainder in Brokerage

I did not do this. Most of my career I contributed 15% to my retirement accounts – initially to pre-tax 401k. Halfway through my career, they introduced the "Roth" 401k option. For me, I wanted to optimize for financial flexibility in retirement, so I switched all my contributions to the Roth (and this continued until I retired). From a financial accumulation perspective, this is the opposite of what you should do (Optimal would be to contribute to the Roth early in your career when wages are lower, and as you get into perhaps the 22% bracket, switch to traditional pre-tax for the rest of your career. That would give you optimal taxes and also flexibility.) I retired at age 56 with everything in my 401k (traditional + roth). Since my contributions never exceeded the max, my brokerage account was just a fraction of my total accumulation.

If I maxed out every year, I absolutely could have retired earlier. Would I do that differently if I started over? Perhaps. It's not clear to me. I believe we struck a good balance between living and saving.

Given the same circumstances, would I follow the "optimal" route of NOT switching to a Roth at the latter half of my career? Absolutely not – because my optimization was for later flexibility. If a Roth had be available at the start of my career, I definitely would have used this early and then switched to traditional later.

Now that I'm in deaccumulation, I'm really glad I wasn't "optimal" in my tax/accumulation strategy because having a nice mix of pre vs post tax funds allows me to engineer my taxable income each year to meet whatever goal I'm going after (ACA, Roth-Conversions, etc).

So, as many have already stated, it depends on how you define "optimal" in your view.

I chose to ease into our increase in pre-tax savings (to get our overall savings rate from around 10% to 20% to 30% or ?) because I did not want to be stuck with the decision for a whole year - can only change employer plan contributions annually - if it was problematic.

So I increased it some and opened Roth IRAs for both of us. This is not 100% optimal but gave me the flexibility to max the Roth if possible, or not, or even take contributions back out if we get in a jam. (We also have a 6-month emergency fund in Fidelity Cash Management account SPAXX.)

My idea is to continue shifting the savings to pre-tax and continue contributing to the Roth accounts if it turns out to be possible when pre-tax is maxxed.

In the Accumulation Phase, the best use of each next dollar is

or https://moneyguy.com/guide/foo/ .

When you get to FI, you just most efficiently draw from wherever your money ends up. In general, it's usually 1) excess cash, 2) turn off taxable brokerage reinvesting, 3) SEPP from rollover Traditional IRA, 4) HSA - the ultimate retirement account (before you die), then 5) Roth. But there might be some throttling in there, depending on what numbers you want to hit for various reasons.

I've been FIREd for over 5 years and still working on taxable brokerage. SEPP will probably be tapped while my 2 teens are in college. We're doing Roth Conversions up to our target tax rate, not for ACA, but long term taxes/ costs, which is beyond any ACA subsidy. Different households have different assets, goals, and values, and with that have some variations.

The author of the Psychology of Money, Morgan Housel states that "no one is crazy, we are all just optimizing for different things".

I also agree with Frank Vasquez in that of you spend less than you earn and invest the rest….everything else is detail and has minor affects on your results.

However, lots of "minor affects" do have compounding effects on each other….so it's worth looking at a little.

In the end….as someone else pointed out….solve what you are optimizing for first, then second and third. Prioritize your top 3 optimizations AND why you chose them. Reprioritize everything else in your mond. That will clear up a lot of internal conflicts.

I love this question, as I’ve struggled with similar questions in every season and finally started asking: “what am I optimizing for?” We so often assume it’s a number, but that’s not always the case.

For me, early on, it was get to the financial metrics - total FI target or savings %. These are simple but not easy - math has a gravity to it, even if the behaviors are difficult to implement.

Things like building a cash EF were a struggle until I changed how I was thinking about it - that money has a purpose which is inherently suboptimal on the whole, but it’s optimized for its assigned job.

Once the numerical thinking got me good momentum, the numbers stayed in the picture, but the focus shifted to more what do I value and what’s my Ramit Sethi inspired “Rich Life” so I intentionally spent more in a targeted way.

I expect my focus will shift again as the journey continues. But as long as I can answer - to myself - “what am I optimizing for?” And the answer is coherent, that is good for me.

I was headed towards that path and then I backed off my savings by about $30k per year and put that all to meaningful life experience spend after reading Die with Zero. It's still optimization, but, as the author said on a podcast, it's not optimizing for money, "it's life, motherf***er!"

$30k can add a LOT to life!

2026

- Gave my nephew a $1-for-$1 "aunty match" towards his first car and he worked so hard towards the goal

- Started a trade school scholarship

- Did a front end rebuild on my classic car

- Taking my big sister on vacation to see her childhood bff in Seattle

- Taking me and my partner to Hawaii (in business class!!!) For our combined birthdays + anniversary

2027

- Renting an entire "glamping" vanue to throw a huge family reunion for my mom's 69th birthday themed, "Summer of 69". We've already had so much fun just dreaming and scouting venues and I'm so excited for the year of planning

2028

My big sister, her daughter and I are all going to study Japanese for a year and then ill take us to Japan (lie flat at least way).

I wouldn't have done most of these on my way to FI otherwise and I'm so grateful for how they have already enriched my life and given me so much to look forward to. And it affects my FI date by maybe 1 year (e.g., age 49 instead of 48)

Love this question. We hit FI earlier this year and left our W2's in May. We are now slow traveling and drawing down from our portfolio to fund our lifestyle. While in the accumulation phase, I tried to optimize EVERYTHING. I have 50 million spreadsheets and genuinely enjoyed learning more through books and podcasts. Looking back on that time, I realize that I was spending all that time on tweaks that didn't make much difference in the end- it just felt good because it felt like action.

No, and its probably not good for your mental health to try to optimize everything. The truth is that if you spend less than you earn and invest the difference, the rest is just details. Many paths work if you are not trying to race against your peers.

What you should learn is the concept of "Satisficing", which means spending minimal effort on stuff you don't care about or are not really interested in doing. This will also help you in retirement. It's really one of the keys to living a happy life, because optimizing everything will drive you and everyone around you nuts.

Satisficing - Wikipedia

en.wikipedia.org

I optimize the big three: maxing out tax advantaged accounts every year, only invest in low cost diversified etfs/mutual funds, and I don’t try to time the market.

But I’ll own up to not fully optimizing for taxes. Why? Flexibility. I have prioritized saving into a taxable brokerage because it's always accessible. Even though I’ve been in my highest earning years I also save ~1/3 of my employer retirement account in Roth. I like the tax diversification, and I don’t think I’m going to regret it, even if I didn’t optimize every penny of tax arbitrage savings.

A few more things I don’t optimize:

• I don’t chase credit card points (everything goes on a 2% cash back card)
• I paid off my mortgage early even though the rate was relatively low. Because it felt great!
• I’m not saving up receipts for HSA reimbursement. I mostly reimburse myself as I go and let the balance build.

Phew, feels good to get that off my chest!