What is Coast FIRE?
Coast FIRE is the point where you've saved enough that you can stop contributing to retirement entirely. Your existing investments, left alone, will grow through compound interest to reach your full FIRE number by your target retirement age.
Think of it as planting a tree. Once it's established and big enough, you don't need to keep watering it every day—it'll grow on its own. Your job shifts from aggressive accumulation to simply not touching what you've built.
The appeal is obvious: you can downshift to a less stressful, lower-paying job that just covers your current expenses. No more optimizing for income. No more grinding for promotions you don't want. You work to live, not to save.
For many people, especially those who discovered FIRE later in life or who don't have high incomes, Coast FIRE is a more achievable milestone than traditional FIRE. It's proof that financial independence isn't all-or-nothing—there are meaningful waypoints along the journey.
How Coast FIRE Works
The math behind Coast FIRE is the inverse of compound growth. Instead of asking "how much will this grow to?", you ask "how much do I need now to reach that target?"
The formula is straightforward:
Coast FI Number = FIRE Number ÷ (1 + return rate)years
Let's say your FIRE number is $1,200,000 (based on $4,000/month expenses). You're 30 years old and plan to fully retire at 65. That's 35 years of growth. Assuming 7% real returns:
Coast FI = $1,200,000 ÷ (1.07)35 = $1,200,000 ÷ 10.68 = $112,360
If you have $112,360 invested at age 30 and never add another dollar, you'll have $1,200,000 by 65 (in today's purchasing power, since we used real returns).
The Variables That Matter
| Variable | Impact on Coast FI Number |
|---|---|
| More years to retirement | Lower Coast FI needed (more time for growth) |
| Higher expected return | Lower Coast FI needed (faster growth) |
| Higher expenses | Higher Coast FI needed (bigger target) |
| Lower withdrawal rate | Higher Coast FI needed (bigger target) |
The power of time is dramatic. At 25 with 40 years to retirement, you might only need $80,000 to coast. At 45 with 20 years left, you'd need $310,000 for the same retirement lifestyle. Starting early matters enormously.
Coast FIRE vs Traditional FIRE
Traditional FIRE means accumulating your full retirement number as fast as possible—usually through aggressive saving of 50%+ of income—then stopping work entirely.
Coast FIRE is a waypoint, not the destination. You hit a smaller number earlier, then shift how you work rather than stopping work altogether.
| Traditional FIRE | Coast FIRE | |
|---|---|---|
| Target | Full FIRE number | Coast FI number (smaller) |
| After reaching it | Stop working (optional) | Keep working, but only for current expenses |
| Savings rate | High (often 50%+) | Can drop to 0% after Coast FI |
| Timeline | Years to full accumulation | Years to Coast FI + years of coasting |
| Risk | Sequence of returns in early retirement | Decades of market volatility during coasting |
Neither is inherently better. Traditional FIRE gets you to full freedom faster but requires more sacrifice. Coast FIRE lets you enjoy life sooner but means working (at least part-time) for longer. Many people end up somewhere in between.
Who is Coast FIRE For?
Coast FIRE makes the most sense if you:
- Started saving young: A 25-year-old with $50,000 invested is already close to Coast FI for many retirement targets. Time is your superpower.
- Want to change careers: Hate your high-paying corporate job? Coast FI gives you permission to become a teacher, artist, or barista without sacrificing retirement security.
- Value present enjoyment: Some people don't want to defer all happiness until retirement. Coast FI lets you optimize for life satisfaction now.
- Have variable income: Freelancers, entrepreneurs, and gig workers can aggressively save during good years, hit Coast FI, then ride out lean years without stress.
- Found FIRE late: If you're 40 with modest savings, traditional FIRE might feel impossible. Coast FI is a more realistic goal that still changes everything.
After You Hit Coast FI
Reaching your Coast FI number doesn't mean you have to stop saving. But it means you can. Here's what that freedom looks like:
Work Flexibility
You only need to cover current expenses, not save for the future. This opens doors: part-time work, seasonal work, passion projects that pay modestly, consulting gigs, or entrepreneurship without the pressure to be profitable immediately.
Geographic Freedom
If your job was the only thing keeping you in an expensive city, you can move somewhere cheaper. Your "coast job" can be location-independent or in a lower cost-of-living area.
Risk Buffer
Smart Coast FI practitioners don't stop saving entirely. They might save 10-20% as a buffer against market downturns. This isn't mandatory saving—it's insurance that costs relatively little when you've already reduced expenses.
The "One More Year" Trap
Warning: Coast FI can become an excuse to never make a change. "I'll just save a bit more to be safe" year after year defeats the purpose. If you've hit your number and built in a reasonable buffer, trust the math and make your move.
Frequently Asked Questions
Use 5-7% for real (inflation-adjusted) returns. The U.S. stock market has historically returned about 10% nominally and 7% after inflation. Using 5-6% is conservative and accounts for potential lower future returns, international diversification, or bonds in your portfolio. Avoid using nominal returns (10%+) unless you're also inflating your FIRE number target.
Yes, but differently than traditional FIRE. You're betting on decades of compound growth. A major market crash early in your coasting phase could set you back significantly. Mitigation strategies include: building a 10-20% buffer above your Coast FI number, keeping some savings capacity even while coasting, and being willing to adjust your timeline if markets underperform. The trade-off is enjoying more of your prime years in exchange for this risk.
On paper, yes—a higher expected return means a lower Coast FI number. But this is risky. If you assume 10% returns and only get 6%, your portfolio won't reach your target. It's better to use conservative assumptions (5-6%) and be pleasantly surprised than to rely on optimistic projections and fall short. You can always adjust later if returns are better than expected.
Your Coast FI number will be higher because there's less time for compound growth. For example, coasting to age 50 instead of 65 roughly triples your Coast FI number (assuming 7% returns). At some point, it makes more sense to pursue traditional FIRE with aggressive saving rather than Coast FI. Use the calculator to compare scenarios.
It depends on your age and risk tolerance. If you're decades from eligibility, it's safer to plan without it. Social Security could allow you to coast with a lower number, but benefits might change by the time you retire. A conservative approach: calculate your Coast FI without Social Security, then treat any benefits as a bonus or use them to increase your retirement spending.
Coast FIRE is a milestone: the point where you have enough to stop saving. Barista FIRE is a lifestyle: working part-time (often a job with benefits, hence "barista") while your investments grow. Many people reach Coast FI and then adopt a Barista FIRE lifestyle, but they're distinct concepts. You can be Coast FI without working at all if you have other income sources, or you might work part-time before reaching Coast FI.