The concept of Coast FIRE has grown popular among those seeking a balanced path to retirement security. Unlike the traditional approach of working relentlessly until retirement or the aggressive “Financial Independence, Retire Early” (FIRE) model, where you stop working entirely after reaching a savings target, Coast FIRE involves intentionally saving and investing as much as possible during your prime earning years until you hit a specific milestone—the “coast” number. This is the amount of savings projected to grow, with no additional contributions, into enough to comfortably support you in retirement. Once you hit this mark, the focus shifts; you can reduce your work hours or switch to a less demanding, more satisfying role, earning just enough to cover current expenses. Meanwhile, your existing investments are left untouched, free to compound in value until you fully retire in your 60s.
This approach provides unique benefits. It’s often viewed as a more attainable version of FIRE, as you get breathing room to enjoy life earlier, taking advantage of health and vitality while still allowing your investments time to mature. Importantly, you retain valuable work benefits like health insurance and social connections, all while your savings continue to do the heavy lifting in the background. Coast FIRE encourages strategic planning about future income streams, including Social Security, pensions, and projected investment growth. It’s crucial to estimate not just your expected retirement expenses but also what your cost of living will be both at your “coast” date and your ideal retirement age. These calculations can get complicated, especially in trying to balance projected needs versus wants, appreciating that your spending may shift over time as you pay off commitments such as a mortgage or as children become financially independent.
Challenges do exist with Coast FIRE. It can be difficult to cut back on spending enough in your early years to maximize savings, particularly for those with young families or substantial debts. Finding satisfying part-time work after reaching your savings milestone can be another hurdle. Some may also find this approach requires regular recalculation as markets shift or personal circumstances change. For those attracted to “bridge” phases on their road to retirement, Coast FIRE offers flexibility, allowing you to drop to part-time or change careers multiple times as different financial goals or life milestones are met before full retirement.
Ultimately, Coast FIRE appeals to people who are disciplined in their spending and who prioritize long-term financial independence over short-term consumption. It offers not only a means to potentially retire with security, but also helps foster a happier, less stressful working life leading up to retirement, bridging the gap between aggressive early retirement and the traditional work-until-you-drop mindset.
