Coast FIRE

Coast FIRE (Financial Independence, Retire Early) is arguably the most attainable and stress-free milestone in the entire early retirement movement. But what exactly is it, and how does it differ from traditional FIRE?

What is Coast FIRE?

You reach Coast FIRE when your retirement portfolio has grown to a point where, based on historical market returns, it will naturally compound to reach your traditional retirement goal without you ever needing to contribute another dollar.

Imagine you are 30 years old, and you have aggressively saved $150,000. If you leave that money in an S&P 500 index fund and it grows at a conservative 7% after inflation, it will double roughly every 10 years.

• At age 40, it is worth $300,000.
• At age 50, it is worth $600,000.
• At age 60, it is worth $1.2 million.
• At age 65, it is worth roughly $1.6 million.

If $1.6 million is enough for you to retire comfortably at 65, then at age 30 with $150,000, you are completely done saving for retirement. You have reached Coast FIRE.

The Psychological Freedom of Coasting

The true power of Coast FIRE isn’t just mathematical—it’s psychological. Once you hit this milestone, a massive burden is lifted.

“I no longer need to save for the future. I only need to earn enough to cover my present expenses.”

If you were earning $100,000 a year but saving $40,000 of it, you only actually “need” $60,000 to live. Once you hit Coast FIRE, you can quit that high-stress $100k job and take a much lower-stress, more fulfilling job that only pays $60k. You can downshift. You can take a pay cut. You can switch to part-time work or become a freelancer.

How to Calculate Your Coast FIRE Number

To find your Coast FIRE number, you need to work backward. Here is the formula:

Coast FIRE = FIRE Target / (1 + Growth Rate) ^ Years to Retirement

Let’s break down the variables:

1. FIRE Target: The total amount you need to retire comfortably (usually calculated using the 4% rule, which is 25x your annual expenses).
2. Growth Rate: The expected annual return of your investments, adjusted for inflation. 7% is standard.
3. Years to Retirement: The number of years between your current age and your traditional retirement age (e.g., 65).

Real World Example

Let’s say Sarah is 35. She wants to retire at 65 (30 years from now). She calculates that she needs $50,000 a year in retirement, meaning her FIRE target is $1,250,000 (50k * 25).

Her formula looks like this:

$1,250,000 / (1 + 0.07) ^ 30

Her Coast FIRE number is roughly $164,000.

If Sarah has $164,000 invested right now, she can stop saving entirely. She just needs to cover her current rent, groceries, and lifestyle.

Coast FIRE vs. Barista FIRE vs. Traditional FIRE

It’s easy to get the different flavors of FIRE mixed up. Here is a quick breakdown:

• Traditional FIRE: You have 25x your annual expenses saved. You can quit working completely right now.
• Coast FIRE: You have enough invested that it will grow to your traditional FIRE number by age 65. You still must work to cover your daily living expenses, but you don’t need to save.
• Barista FIRE: You have a large portfolio, but not quite enough to cover all expenses. You take a part-time job (like at Starbucks) to cover the gap and get health insurance, letting your portfolio cover the rest.

Why Coast FIRE is the Ultimate First Goal

Achieving full FIRE requires intense discipline, high income, and usually a decade or more of extreme frugality. It can lead to burnout.

Coast FIRE, on the other hand, is achievable for many middle-class earners in their 20s and 30s. It provides immediate lifestyle benefits (the ability to change careers or work less) without requiring you to wait until you have $2 million in the bank.

Start your journey by finding your number today using our Coast FIRE Calculator.