Is it possible to get to Financial Independence on £12,500 per year?


This post was originally published in Oct 2018 but I updated it in Aug 2020 including a funky diagram from

The answer, of course, is no.

And yes. But mostly no.


Let’s start with no. You’re not gonna get on the housing ladder let alone get to full financial independence if you’re earning £12,500 a year and everything stays the same forever.

Some say that The Dirty Little Secret of Financial Independence is that income matters and FI is harder for lower income earners.

The Escape Artist says:


If that was a secret for you, I have some others:

Stories like that of The Fireman (who became a multi-millionaire on a fireman’s salary) show what’s possible, not what’s normal. Whilst teachers sometimes leave millions in their wills, that stuff makes the news because its so unusual and unrepresentative.

Frugality is even more important for low earners

It’s even more important for low earners to avoid getting ripped off by the circus of consumerism, advertising and marketing.  This is not (just) my opinion, its common sense.

Do I need to explain that low income people have less scope to get away with ridiculous spending? Well yes it seems I do.  If you’re on a low income, you’ll spend a higher % of it on basics like energy.  This makes it all the more important to make sure you’re on the cheapest tariff. And yet ~60% of people have never switched energy provider and are on expensive standard tariffs.

And if everyone is so poor, why are they buying shit?  Those Premier League new season football kits are not buying themselves.  High streets and shopping centres are full of people who are financially self-destructing.  To quote The Minimalists

We are spending money we don’t have, on things that we don’t need, to impress people that we don’t even know

When high income, well educated people live like this it’s i) unwise ii) bad for the environment and iii) a bit vulgar.  When people at the bottom of society borrow money trying to live like this, it’s a disaster for them.

Low income now does not mean low income forever

Things don’t stay the same forever.  You won’t always earn your current salary.

The Escape Artist started his career on £1.07 per hour.  I know what you’re thinking: that’s cheating as it was ages ago and doesn’t reflect inflation.  That’s true, I haven’t inflation adjusted it into today’s money.  But let me tell you…£1.07 an hour was still shit money back then.

OK, so that was just a holiday job. What about when I got my first proper job at The World’s Leading Accountancy Firm? Obviously a man of my talents would be expecting a princes ransom.  So how does £12,500 per year sound to you?

So yes, I did achieve financial independence starting from £12,500 per year.

Earning more is not cheating

Income is not set in stone. The best way that people on low incomes can get to financial independence is by increasing their income (as well as holding down spending). This is not easy but its possible with time.

The Escape Artist is here to tell you that earning more money is not impossible…nor illegal…nor unethical. In Earning More Is Not Cheating, we looked at 5 ways you can earn more money:

  1. Work harder
  2. Take more risk
  3. Do something that others can’t (or won’t) do
  4. Get a side hustle
  5. Negotiate better

Unfortunately, none of these come with a guarantee.  That’s because there are no guarantees.

How would the complainers know what’s possible for other people?

I’ve worked minimum wage jobs but I don’t know what its like to be stuck at that level. My guess is that its either impossible or very hard to get to financial independence if you get stuck in minimum wage jobs. Unless you are Bear Grylls of course.

I don’t labour that point because a) its fucking obvious b) the readers of this blog are intelligent c) I’m trying to help people here and who am I to tell other people what they can’t achieve?

Through my financial coaching over the last few years, I’ve met people of all ages (18-70), careers (from yoga teachers to fund managers to entrepreneurs) and life situations. Women and men from all ethnic backgrounds. That’s how I know what other people can achieve.

The problem with the complainers is that most are so focused on themselves that they have no idea what other people can or can’t do. How would they know what’s possible for other people they’ve never even met?

There is no One True Path

One size does not fit all and there are many different paths through life.

Just as my path to financial independence does not apply to everyone else, nor does yours.

The Escape Artist does not claim to be normal. If I was attempting self-awareness, I would describe my younger self as an introvert with above-average intelligence, above-average bolshiness determination and below-average people skills.

This leaves The Escape Artist open to accusations of getting lucky. There is some truth to this: working in finance was easier than, say, coal-mining (although it certainly didn’t feel easy to me).

But if you have good people skills you can make more money in sales than I earned…in a wide variety of industries.  You don’t need to be a genius to sell, you need good manners, some charm and an understanding of How To Win Friends And Influence People. You can make more money selling double glazing or with your own plumbing business than I earned in finance.

It’s NOT binary!

If you do an Evil Knievel style motorbike jump over a canyon and you land one metre short of the other side, you fall to your death. You either make the jump or you die: that’s a binary outcome.

Here’s another secret: Pursuing financial independence is not the same as doing a motorbike jump over a canyon.

The reason its different is that when pursuing FI, if you fall a few pounds short of saving say 25x your annual spending you do not plunge to your death.

No, you can just keep working a bit longer. Or do a part time job. Or some paid house-sitting or dog-walking. Or cut your spending a bit. Or claim the state pension.  Or lots of things. No need to panic at all really.

If you do the stuff on this website, you will get richer.  You might just do a couple of years of frugality to get out of debt. Or you might just want to clear your mortgage and then go part-time rather than aim for full financial independence. That is not failure: there is no failure.

Everyone can improve their situation

Financial independence is a spectrum ranging from someone broke at one end and Warren Buffet at the other end.  The question is not whether we can all become Warren Buffett. Clearly we can’t.

The real question is whether more people can move away from the sucker end and towards the Warren Buffett end of the spectrum.  In other words, can everyone get better with money?

Yes! This is such an important point that its worth repeating what I’ve said before:

Sometimes people tell me that not everyone can get to financial independence. I file that information under “N” for No Shit, Sherlock.  Not everyone can run a marathon in 3 hours either…but more people would be able to run 5 or 10 miles if they put down the fucking donuts and went for a run.

The same principle applies with saving money. It’s not a binary choice between being broke or financially independent. How about being debt-free, having your pension set up properly and a years expenses tucked away as an emergency fund? That’s not full financial independence but it would be a massive improvement for most of the population.

Doing nothing is over-rated

Another criticism of the whole FIRE thing is that not everyone wants to live in a trailer in an RV park doing fuck all all day other than blogging, navel gazing and knitting their own lightbulbs. Again, there is some truth in this. As someone smart once said:

“You can retire from a job, but don’t ever retire from making extremely meaningful contributions in life.”

Stephen Covey

Continuing some paid work (e.g. working part time or working for a charity or on a lifestyle business) makes the numbers MUCH easier. Its hard to save £2 million pounds earning £10,000 per year of interest (at a 0.5% interest rate on a bank account). But its pretty easy to earn £10,000 per year from a part time job or lifestyle business after you’ve escaped from The Prison Camp.

A period of decompression is wonderful but, after that, doing nothing is over-rated. If there is a “dirty little secret” of financial independence, its that you don’t need to wait until you’ve got >25x your annual spending before making changes in your life.

How can we help people?

Let’s focus on how everyone can improve with money…starting with baby steps. This is a growth mindset rather than a fixed mindset.

Talk is cheap, actions are what matters.  The point of blogs like this one is to give actionable steps that anyone can follow to improve their situation.

The question is not whether there is some magic wand that we can wave to immediately make all poor people rich…there isn’t.  The question is whether everyone can get better with money?

I think we all can.


  1. I also started on just aover £1 an hour, kitchen portering 😉

    One of the keys to FI in my view is what you don’t do in that critical 20s to 30s part of your working life. #1 IMO is don’t have kids you can’t afford, because if you do and don’t earn enough, you’re gonna be nailed to the floor, particularly if, as all too often happens, your relationship fails in the early stage because you have lost a lot of the couple’s earning power.

    A very close #2 is don’t borrow money to buy shit, particularly on cards. That’s not quite as terminal, though, because paradoxically going bankrupt/getting an IVA pretty much limits your capacity to dig the same hole twice, you have a chance to practice the frugality thing ‘cos nobody will lend to you. I have seen people succeed there, but being a lone parent with not enough coming in seems a very hard load to get up from under. I have never someone win that fight, whereas I have seen the odd person mend their spendthrift ways through bankruptcy.

  2. Yep, I have done it so, from experience, I know it is achievable…probably not in London but certainly in many parts of the country where the cost of living is relatively cheap.

  3. Those Premier League new season football kits are not buying themselves.

    Love it dude. It’s similar in America except with football. I’m from Baltimore and if you go to a Baltimore Ravens game you see tons of lower income people with $130 Ravens jerseys on. Worse yet is they usually have a players name who will undoubtedly be traded in a year or two, “forcing” them to buy another players jersey afterward to throw their support behind someone with money they don’t have.

  4. FI Warrior · · Reply

    Yup, if you’re poor you have less layers on and so feel the cold quicker, as such frugality has instant repercussions even if you never get wealthy, because marginal gains are so much more noticeable.

    Given planetary overpopulation is unceasing, (something that is taboo to mention; a lot of people are poor because they could not afford to even be born) all manner of competition can only get more severe. The symptoms of this are all around us and it takes more effort to ignore it, so frugality is going to be forced on the masses anyway as social safety nets even in nominally wealthy countries dissolve. The general spread of autocratic government means that this can be accelerated as past pledges are simply withdrawn, like with austerity in the UK for example and less benefits being guaranteed. A lot of people will think harder about buying crap they don’t need when it’s now a choice between that and heating in winter.

    1. Hi FI Warrior…you are allowed to talk about global population…its a valid subject for discussion for anyone that is genuinely interested in the environment (another non-secret of FIRE is that its actually an environmental movement as well as a financial movement).

      I think its possible to solve the problem. If other large countries in the developing world imposed a 1 or 2 child limit policy (like China did) it would largely be solved in a generation. Over the longer term it could (and should) also be tackled in the developing world via female literacy programmes, the spread of the internet, better availability of contraception etc etc. The Gates foundation is targeting this stuff.

      1. FI Warrior · · Reply

        Hey Dude, most of us are Cakeists in that we want what we can’t afford and will delude ourselves to hell and back to justify it. I’m roughly your age, but had to choose between FI or kids and mainly the selfish fear of not making it over the finish line with dignity and human comfort made me choose the former. A secondary but far from insignificant consideration was not feeling confident I could have a reasonable chance of giving a child a fair chance in life and that is something I couldn’t live with. On experience I have never even abandoned a pet, while others can discard them like old furniture, so I can guess it would feel like a nightmare to fail a child.

        Worldwide, you’re more optimistic than I am, my extended family have shrunk like a species hurtling towards extinction in the last generation, basically because of insecurity in the present with no sign it’ll improve in the future. We’re very highly educated though compared with the general population, due to putting resources into knowledge first before any other expenditure, so I guess that everyone else will not change. The inevitable outcome of that is that should global trade shrink in volume with the increase in protectionism, then people in many countries will suddenly understand they can’t feed themselves. (apparently the Uk only produces enough food for half the current population)

        It isn’t outrageous to say that the best case scenario is that quality of life deteriorates at a steady but significant rate (noticeable even to sheeple) as the exploitable/affordable hydrocarbon fuel our way of life now depends on, runs out. This has been happening all of this century, hence the toxic political stalemate in the Uk; people may not be able to understand or articulate what’s happening, but they know things are tanking whatever they’re told. This is the only reason FI/RE is getting any attention now at all, let alone being taken seriously, before we’d have been perceived as anti-conformist, lazy, sadomasochists, or hippies, certainly something derogatory. The pursuit of status has only become less sexy because it’s increasingly unattainable to most, so FI is a way for many of the mainstream to save face. It’s the same reason why the likes of Lidl are no longer shameful for the middle-classes to be seen in now. (you’re canny with your money vs cheap and vulgar a few years ago) So we’re only going mainstream because the herd has been pushed to envelope us.

  5. People think the world only spins on its axis by using money every day, but actually money is just an IOU for the real lubricant of life on this planet and that is surplus energy. There is a cost to producing energy and we live in the hydrocarbon age, so countries economies fundamentally depend on how much oil or gas they can afford right now, sustainable energy is still irrelevant for various reasons in the grand scheme of things.

    In fairy tales, based on how life was in pre-industrial revolutionary times, they often started with ”A poor woodcutter…..” because that’s what the energy that fueled life was limited to, in those days, translating to a feudal, basically animal existence level for the vast majority and just Ok for the 0.001%. Even so, the poor on benefits today may have food and heating in winter which would be better than the elite of that time for example.

    But the party is over now that the oilocene/plastic era is ending, because in energy terms, all the low hanging fruit has been picked, so prosperity has hit the buffers inevitably, given our entire way of life is based on consuming and waste, only viable when energy is a certain price. If someone with a chainsaw can cut 100 trees in a day now, which the woodcutter and his axe could only do one tree in, guess what it means? We can only regress to feudalism via rapid population decline and the ignorance of the masses on this fuels the populism which will crash our civilisation faster. Locally, we have the precedent of the Roman withdrawal, so nothing really changes in history.

    1. Let’s hope Elon Musk and others like him sort out large-scale electricity storage, PV efficiency and electric vehicles in time.

      Linking to the point above, my view is that there would be a somewhat lower risk of us all crashing back into the dark ages if we tackled the population issue. I’m confident it will be solved one way or another…the only question is how and in what timeframe.

  6. Sanjay Ratna · · Reply

    Guess all I would like to say is, ”F**K YOU”. John Goodman says it quite eloquently in the movie, ”The Gambler” to Mark Wahlberg. I love reading everything here and the people’s view. Thank you and I gonna get to say, ‘FUCK YOU’ to the man soon.

  7. ladyaurora · · Reply

    On the money, again.

  8. SurreyBoy · · Reply

    I think the end of civilization has been confidently predicted before, and things tend to go from good to better for most of humanity.

    I worked out the other day that I no longer have to work provided my wife carries on working in a job she loves. Full 100% FI is around a year away. So the EA is right – IT CAN BE DONE

  9. fatbritabroad · · Reply

    Pretty much what I said (less eloquently) in my UK fi podcast interview that fi isn’t for everyone but the principles of fi can be applied whatever your salary.

    I do earn good money now at 38 but only got to higher rate tax 6 years ago and that happened rapidly so actually more than half my net worth has been generated in the 12 years when I was on a wage of 11500 in my first job and ended up at 31 on an income of 35k. So yes not low income by any means but the majority of my life so far I’ve earn the national average or less. And I live in the South.

    I bought my first property at 20 (a 1 bed shared ownership flat) and have also got divorced which set me back 100k 4 years ago.

    Not saying it to boast in the least just to say its vastly more difficult on low wages but possible as long as you are mindful. I always had an irrational (or healthy) fear of being poor in old age so always paid into a pension which now accounts for probably a 1/4 of my net worth with half being property equity and the rest being savings and isas

    1. Hi Fatbrit… That is pretty much the same answer I gave in my podcast, although I think I may have come across a bit more negative than that! But the gist of it was definitely the same.

      Most important point made here is that it’s not binary and you don’t have to save up anywhere near 25x your salary to start seeing the positive changes in your life situation.

      It reminds me of a great quote about climate change and people (deniers) who for reason seem to be against renewable energy and cutting pollution etc…

      “What if it’s a big hoax and we create a better world for nothing?”

      The analogy isn’t perfect but it’s similar to saying

      “What if I never save up 25x my expenses and I improve my life for nothing?”

      Or insert any of the common objections to FI as the first part of that sentence!

  10. SurreyBoy · · Reply

    I think a problem with the FI movement is that it is often presented as a binary thing – you are either FI or you are not. You have made it or you have not. I think this can put people off who would actually have a decent shot at achieving FI if they tried.

    As the EA sets out, hustling your income up a bit, driving down waste, and sensibly investing any excess should get people at least to a point where they are not financially desperate or vulnerable to short term shocks. Problem is, some of the FI zealots who chuck their lives into spreading the word do put some people off.

    I mean look at this article. So the guy is saying you need £3.8m sterling for a family of 3 to live comfortably in a pricey part of California. Maybe he is correct, but someone in the UK is likely to look at that and think FI is completely unattainable. Just the blindingly obvious point that the NHS is free at the point of use and the state provides a decent free education in most areas makes a massive difference.

    On Friday i was in the pub in London (not the FI meet up at the Old Bank of England) paying £6 a pint. Thats fine – it was a nice pub and i was with friends. But I wont base my FI model on it being a daily occurrence. Or perhaps I will – but i guess my point is that there is decent pre FI way to live where you are not vulnerable, then there is perhaps lean FI and then the gold plated version.

    1. Financial samurai has some great advice but many of his articles fall into “professional troll” territory for me and he’s just going for easy click bait titles like that. It’s a shame because I bet a lot of the people who come across them don’t bother reading more into his site and seeing the good stuff as like you say it just puts them off!

  11. I agree, a lot of it is due to how proactive (‘action’ is the key word) you are and how keen you are to blame others and life for everything or take responsibility and start making positive changes. I’ve seen people who have not had much money but the right mindset and behaviours succeed much more than people on high income who could not stop spending and blaming everyone but themselves.

  12. Go for the blogs which makes sense to one. FS might be applicable for those who earns large amount of money and wishes to do likewises the same for the expense. These are options for one to follow and not to follow. Go with the feel and it will never go wrong.


  13. Hermann · · Reply

    Just discovered The Escape Artist and going through the articles slowly.

    I didn’t know there was a name for this way of thinking, but I’ve been approaching this on my own initiative since around 2005.

    I was raised on a disintegrating council estate, suffered a shite non-education, then left school to fend for myself [as we all did]. Observing numerous suicides and drug problems due to medieval social barriers, I burnt my bridges and travelled around Europe and Asia for several years. I was around thirty when I returned, so past the FIRE threshold.

    Nonetheless, my following experience may help younger low income FIRE aspirants.

    When I returned to the UK, I had nothing, so in 2005, I set myself up in part-time self-employment, earning around £7000 to £8000 pa [yes, that friggin low!]. I lived in a civilised, but extremely cheap bedsit, saving around £4000 to £5000 pa. Luckily I’m ascetic minded.

    But here’s the key, instead of saving the money in the bank, I decided to invest the money into ‘accumulation’ trusts and funds [I had to teach myself from scratch, but my travels served me well, as I mostly invested in the Asian growth story], these I methodically moved into an ISA account [i.e., the poor man’s ‘off shore tax haven’]. In the beginning it was slow, but then I noticed the following three stages of financial progress.

    [Stage I]. After a few years, my investment ‘capital gains’ [e.g. £5000] were making the same amount as the ‘earnings’ I was putting in [e.g. £5000], so at this stage, I was effectively investing around £10,000 pa.

    [Stage II]. A few years later, my capital gains became equal to my wages. This marked an important juncture, as my portfolio now acted as an employee. Indeed, the portfolio was now putting in more capital than my work earnings!.

    [Stage III]. The next thing I knew, my portfolio was earning more than my wages!. This has currently halted, as I’ve secured my gains and moved into new market positions, which hopefully, will start to move off again.

    I’m still working for myself part-time [around £14,000 pa], which I love, as I’m not a wage slave, but I reckon I’ll be FI in around three years. As I’m content living a financially independent semi-ascetic lifestyle, I’ll probably have more than I need. Moreover, if I choose to return to Asia, . . . I could retire in extreme comfort.

    So for any equally under-privileged young readers, I would like to say, that with Spartan self-discipline, FIRE is achievable, . . . do not give up, . . . and listen attentively to Mr TEA.

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