As someone who helped ignite the modern day FIRE movement back in 2009, I’m amazed out how popular the movement has come! I’ve been retired since 2012 and my wife, who is three years younger, joined me in early retirement in 2015. Not a day goes by where we are not thankful for saving and investing aggressively to get out of the rat race.
Back in my day, there was only one version of the FIRE movement. That version is having your retirement portfolio(s) generate enough passive income to fund your desire early retirement lifestyle.
Today, we have Fat FIRE, Lean FIRE, and Barista FIRE. These three types of FIRE serve as the foundation for the main different FIRE lifestyles. But what about this new type of fire called Coast FIRE?
Let’s look at some various definitions of Coast FIRE according to some FIRE enthusiasts on the Reddit FIRE sub-board, as well as my official definition of Coast FIRE.
The Definition of Coast FIRE
My official definition of Coast FIRE is this: A person who is almost completely financially independent, but still needs a job to truly feel comfortable living the FIRE lifestyle. The job tends to be a low-stress job that provides extra income to cover non-essential living expenses. Someone who is Coast FIRE can coast through his or her job or choose any type of job he or she wants so long as it’s interesting.
Here are various definitions of Coast FIRE from various FIRE enthusiasts.
Coast FIRE means you have enough in your retirement accounts that without any further contributions, it will grow into enough to cover your “traditional” retirement. With Coast FIRE, you only need to earn enough to cover your current expenses. i.e. if you were making $80k and saving 50% for retirement, now you only need to earn $40k to cover your expenses pre-traditional retirement.
Coast FIRE sounds like Barista FIRE, which is a type of FIRE where someone works a fun job to help pay the bills and provide some social activity. However, the Barista FIRE person essentially has enough in his or her retirement accounts to retire if need be.
Here are some various definitions of Barista FIRE and Coast FIRE. See if you can spot the difference.
Barista FIRE = You are Barista FIRE if you follow the 4% rule on your investments and it kicks off enough income to pay for your basic necessities. You can work a part time “barista” job to cover the remainding expenses. .
Coast FIRE = means you have enough saved (with the power of compounding) to cover traditional retirement. This is a fairly low number to hit when you are in your 20s or 30s since time is on your side.
Barista FIRE = means you have enough saved to only need to make the amount of money each year that would be doable from a part time, lower paid job. Then you could supplement that income by drawing down from your investments.
Barista FIRE = means you are withdrawing money from your portfolio, but supplementing it with income.
Coast FIRE = means you don’t touch your portfolio but you dial your employment back to cover your expenses only. Once the portfolio grows to cover your full expenses, you are FI.
This seems like the most rational definition of Coast FIRE.
Coast FIRE = For us, it means working low-stress jobs just to pay the bills while leaving our savings untouched. Currently, that means we each earn $15,000 per year to cover our household expenses of approx. $30,000 per year. So my quota is $41 per day, 365 days per year.
So I guess my definition of Coast-FI would have two parts. 1) You get a job that’s either low stress, part time, or both. 2) You have enough saved that you can eventually legit FIRE with your current portfolio.
Sounds like Barista FIRE to me!
Barista FIRE = It represents the ability to pick your job based on how much you enjoy it rather than how much it pays. It may be coupled with a limitation on hours. When we are describing Barista FIRE, it’s a life choice that people pick rather than something forced on you by circumstances. If you aren’t interested, then you know, don’t do it?
A person that needs to work *just any* job for 20 hours a week is in a significantly more flexible position than a person that has to work a job that pays at least $X per hour full time. It’s a kind of freedom and I’m really over any kind of gatekeeping – if that’s your goal and you want to call it Barista FI then we all understand what you mean.
Sounds like Coast FIRE to me!
Barista FIRE = where you get a more relaxing (in theory), low-paying job to get out of the house and cover most or all of your day-to-day expenses, once you no longer need to save anymore for retirement.
Coast FIRE = where you don’t necessarily change jobs, but you no longer need to save for retirement so you “coast”, either working less or increasing your spending instead of saving more.
Coast FIRE and Barista FIRE Are The Same
Based on the various definitions of Coast FIRE and Barista FIRE, they are basically the same thing. Maybe one is a slightly darker shade of grey.
If someone can find an enjoyable job and coast through life and enjoy it, then great. I personally find it hard to find any job that is more enjoyable than having absolute freedom. I don’t care how much someone pays me, if there is a schedule I have to adhere to, it’s not as nice as being free.
Using Coast FIRE is a way to keep motivation alive for FIRE enthusiasts who aren’t quite there yet.
As more and more people aspire to FIRE, but who are still very far away from true FIRE of having enough investment income to cover one’s desired lifestyle, there will undoubtedly be more FIRE acronyms popping up.
It’s human nature to describe and justify our financial state, even if we’re so far away from true financial independence. It makes us feel better and happier to keep on going!
Good luck everyone on your journey to financial freedom. I’ve been writing about FIRE since I first started Financial Samurai in 2009. It’s been a great journey and well worth it. Once you get to FIRE, you will realize it was all worth it as well!
See: After-Tax Investment Amounts By Age To Comfortably Retire Early
