Financial Independence

Early Retirement in America Requires Millions. Consider ‘Coast FIRE’ Instead

Coast FIRE and Coast FI refer to a wealth benchmark in financial independence culture. Here’s what they are and how they work.

Coast FIRE enthusiasts frontload investing efforts now so that their money has more time to grow, allowing for more career flexibility later in life. Image via layers feature in Canva

$1.46 million. That’s how much Americans now think they need to retire, according to a new study from Northwestern Mutual released last week.

Retirement culture is depressing and unrelatable for many consumers. One personal finance movement, “financial independence, retire early” (FIRE), aims to buck retirement norms. But early retirement and financial independence often require even higher sums of money. More importantly, some people don’t actually want to retire altogether in their later years.

One variation on FIRE culture is known as Coast FIRE, and it’s one of the easier benchmarks to hit within the typical financial independence journey. In Coast FIRE, you aspire to reach a net worth at which your existing investments will eventually compound to your target retirement net worth without having to make any additional contributions. This frees up money you would normally continue depositing into a retirement or brokerage so you can enjoy it now and still feel on-track to retire.