Coast FIRE Calculator

What is Coast FIRE?

Coast FIRE (Financial Independence, Retire Early) is a milestone in personal finance where you have already accumulated enough invested assets that, without contributing another penny, compound growth alone will expand your portfolio to fully fund your retirement at your target age. Reaching Coast FIRE means your retirement savings are effectively complete on autopilot, liberating you to work fewer hours, switch to a lower-stress career, or spend 100% of your current earned income on lifestyle desires.

Unlike traditional FIRE, where your portfolio must support your everyday living expenses immediately (which you can project with the FIRE calculator or the early retirement calculator), Coast FIRE requires you only to earn enough from active work to cover your day-to-day living costs. You no longer need to allocate 20% to 50% of your paycheck toward retirement accounts like a 401(k) or IRA. If you are currently optimizing employer plans to hit your initial coasting nest egg, you can model your workplace contributions using the 401k calculator. To structure your ongoing lifestyle spending and savings allocations before and after coasting, explore the 50-30-20 rule budget calculator or build custom spending categories with the budget calculator.

The mathematics behind Coast FIRE

Calculating your Coast FIRE number involves two fundamental financial steps: establishing your target retirement nest egg in today's purchasing power, and then discounting that future target back to the present day using an inflation-adjusted compound growth rate.

1. Determining your full FIRE target

Your full FIRE target is the total portfolio value needed at your desired retirement age to sustainably support your annual living expenses. Based on retirement withdrawal research such as the Trinity Study, this is calculated by dividing your annual expenses by your chosen safe withdrawal rate (SWR):

For example, if you anticipate spending $50,000 per year in retirement and choose a traditional 4.0% safe withdrawal rate (or the classic 25x annual expenses rule), your target retirement portfolio is:

2. Accounting for inflation with the Fisher equation

Because retirement planning spans decades, inflation gradually erodes purchasing power. To ensure your Coast FIRE milestone reflects true purchasing power in today's dollars, the calculator adjusts the nominal expected investment return using the Fisher relation:

If your diversified equity portfolio yields an expected nominal return of 7.0% per year (nominal return rate = 0.07) and annual inflation averages 2.5% (inflation rate = 0.025), your real compound rate of return is approximately 4.39% per year:

3. Present value discounting to find your Coast FIRE number

With your real return rate and the number of compounding years until retirement (years to retirement n = retirement age minus current age), your Coast FIRE number is the present value (PV) required today:

For a 30-year-old planning to retire at age 65 ($n = 35$ years) with a $1,250,000 target:

If this 30-year-old has accumulated $277,852 in index funds or retirement accounts, they have achieved Coast FIRE. They do not need to invest another dollar for retirement, provided their existing portfolio compounds as projected.

Practical strategies once you reach Coast FIRE

Reaching Coast FIRE unlocks powerful lifestyle choices well before traditional retirement age. Here are key pathways individuals take after crossing their coast milestone:

• Downshifting to passion work: You can transition from high-stress corporate roles to teaching, freelancing, non-profit roles, or entrepreneurship where compensation only needs to cover current monthly living costs.
• Part-time or seasonal schedules: Many coast practitioners move to 3-day or 4-day work weeks, taking extended unpaid sabbaticals or seasonal leaves without jeopardizing long-term retirement security.
• Spending 100% of current income: Instead of feeling guilty about taking family vacations, dining out, or pursuing hobbies, you can comfortably spend your take-home pay because retirement compounding is already fully funded.
• Hedging against sequence-of-returns risk: Continuing to earn active income buffers you from having to sell assets during early market drawdowns, preserving portfolio longevity.

Evaluating returns, inflation, and historical portfolio growth

Because Coast FIRE relies on multi-decade compound interest, your return assumptions play a crucial role. Historical annualized equity returns (such as the S&P 500) have hovered around 9% to 10% nominal and roughly 6.5% to 7% real, though conservative planners frequently model 4% to 6% real returns to maintain a margin of safety.

To evaluate your actual multi-year portfolio performance and account for volatility drag, use the CAGR calculator or examine geometric versus arithmetic returns with the average return calculator. If you want to see how sustained inflation erodes future purchasing power across multiple decades, test scenarios using the buying power calculator. If you also plan to supplement your retirement with guaranteed income annuities or pensions, you can project fixed lifetime payouts using the annuity calculator or review defined pension schemes with the Atal Pension Yojana calculator.

Frequently asked questions