Coast FIRE - Is It a Retirement Strategy or Burning Beach?

I get a lot of questions about the FIRE movement and if it’s something folks should pursue. First of all, what is the FIRE movement? Is it a club for arson enthusiasts or is it a retirement strategy? FIRE, in this case, stands for Financial Independence Retire Early. The original FIRE movement was all about saving a ridiculous amount of your income in order to retire as early as possible. This meant living minimally and saving/investing more than 50% of your pay. Not exactly an easy thing to do if you have kids and/or are a normal human.

In the years since the invention of FIRE (cavemen are like “how dare you steal this from us?”), FIRE has evolved. As we know, personal finance is personal. Not everyone has the same goals and that’s okay. Not everyone wants to retire at 30 and do ayahuasca in the rainforest. We have different visions for our life, and that’s okay! And if you do want to retire at 30 and do ayahuasca in the rainforest, you do you.

So now we have all sorts of different FIRE movements - you’ve got your regular FIRE, your fat FIRE, and today we’re going to discuss Coast FIRE.

Coast FIRE is for the folks who still want financial freedom, but also enjoy things like ordering takeout and sleeping in on Saturdays.

So, What Is Coast FIRE?

Coast FIRE is basically financial autopilot. The idea is to save and invest enough early in your career so that, even if you never contribute another dime, your investments will grow into a cushy retirement fund by the time you’re 60 or 65 (traditional retirement age).

In other words: Do the hard work early, then coast through the rest of your working years like the financial badass you are.

You’ll still need to cover your living expenses with a paycheck, but you can stop stressing about stuffing money into your retirement accounts because Future You is already taken care of.

Why It’s Awesome

Once you hit Coast FIRE, you no longer have to save for retirement. You can:

• Take a less stressful job (read: no more toxic bosses)

• Work part-time, freelance, or take a sabbatical to “find yourself” in Bali (maybe this is where you do ayahuasca? Just spitballing ideas here…)

• Start a business, become a barista, or finally pursue that llama farm dream

• Spend less time worrying about money and more time doing literally anything else

It’s financial peace of mind without the pressure of extreme early retirement.

How Much Do I Need to Coast?

Your Coast FIRE number is the amount you need invested today so it can grow into your retirement goal by the time you hit traditional retirement age, without adding another penny.

It’s basically a math problem, but luckily there are Coast FIRE calculators online.

Let’s look at a simple example:
You’re 35 and want $1 million by age 65. Assuming a 7% return:

So, if you’ve got $131K invested already, congrats! You can coast.

Really, that’s it?? Well, we do need to take into consideration inflation and rising cost of living and what you want your retirement to look like. It’s very possible $1 million won’t be nearly enough (hint hint cough cough, it’s probably not).

Take a little time to get clear on what you want your retirement to look like. Even if you’re only in your 30s this is a great exercise.

Final Thoughts

Coast FIRE is for people who don’t hate working — they just hate working without options. It’s for the parent who wants to ditch their 9-to-5 to coach Little League. It’s for the millennial burned out by hustle culture. It’s for anyone who wants to stop making financial decisions out of fear and start living a life they actually like.

In short: Coast FIRE is like reaching the top of a hill and realizing the rest of the ride is downhill, and you can finally take your feet off the pedals.

What kind of FIRE do you like??? Should I dive into Fat FIRE next week?? Let me know!

-Catie