Home » Why I Love Coast F.I.R.E. (Coasting Financial Independence) financial independence

Why I Love Coast F.I.R.E. (Coasting Financial Independence) financial independence

by myyachtguardian123



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The FIRE movement is one that a lot of people are interested in, but not everybody can save enough of their income to completely retire at the age of 35. Coasting financial independence is a form of FIRE. Once you reach this point, you can stop investing altogether and just let your investments grow until you reach retirement age. During the time between reaching coast FIRE and retirement, you would only need enough income to cover your current living expenses.

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42 comments

Five Minute Finance 16/09/2021 - 3:24 Sáng

I've received a lot of comments saying that "$50k is only going to be worth X amount by the time that person retires."
And although I understand how inflation works, I specifically stated in the video that I'd be using 7% as the investment return. That is because 7% is the historical return of the S&P 500 adjusted for inflation assuming dividends are reinvested. The chart would look the exact same if we inputted a 10% return with 3% inflation, and you'd reach coast FIRE in the same amount of time.

Also, the instructions for how to use the calculator specifically state that the "Annual Spending in Retirement" should be in TODAY's dollars since inflation is built into the calculator. Because of that, the $50k retirement spending I assumed in the first example is $50k in today's dollars. And the final net worth in the calculator is also in today's dollars.
I hope that clears things up for anybody who was confused.

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adam872 16/09/2021 - 3:24 Sáng

That calculator is excellent, thank you. Looks like I'm about a year away from being where I need to be. Exellent!

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Sonder Expeditions 16/09/2021 - 3:24 Sáng

I'm 7 years from coast FIRE 😊 I'm not someone who can give up lots of pleasures to skimp for retirement so this is perfect for me.

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A 16/09/2021 - 3:24 Sáng

By your definition I have already attained Coast fire.

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Ann Jean 16/09/2021 - 3:24 Sáng

Great video!
Thank you for sharing.

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INVEST REWIND 16/09/2021 - 3:24 Sáng

Props from Germany! Great videos!

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Nata Lie 16/09/2021 - 3:24 Sáng

I usually don't leave comments but thanks, this is really helpful and I love that your videos are 5 minutes!

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No Limits Investing 16/09/2021 - 3:24 Sáng

Great video brother! 💪🏼
Subscribed

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Lorenzo Garofoli 16/09/2021 - 3:24 Sáng

Great video finally explaining what Coast means clearly!
We have started investing this year at age 33/34. A long way to go I suppose, but any suggestion would be appreciated!
Regards

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Justin Burke 16/09/2021 - 3:24 Sáng

8 years is 8 years if you are contributing the same amount each month at the same interest rate…..🤔

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Living Unashamed 16/09/2021 - 3:24 Sáng

I like this, thanks bro. You should have more subs for sure.

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Niels van den Kieboom 16/09/2021 - 3:24 Sáng

I knew about FIRE etc and was actually working out some calculations for it. But wow, I just did the coast FIRE calculation. I am 25 now and it says I can Coast FIRE in about 5 years. Even if it turns out to be a bit too optimistic and let's say it's 10 years, that's still very early in my mind!

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Finding Profits 16/09/2021 - 3:24 Sáng

Amazing video, keep it up.

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Nathan Johnson 16/09/2021 - 3:24 Sáng

Well done. Interesting and easy to follow your explanation.

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My HallyuLife 16/09/2021 - 3:24 Sáng

An even better calculation would be setting the retirement age to earlier than 65 to show financial independence before the typical retirement age. Great video though. I will be checking this calculator out!

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Ray Corcoran 16/09/2021 - 3:24 Sáng

The Youtuber in me is impressed you got 25,000 views with 726 subscribers, great vid!

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GOATMENTATOR 16/09/2021 - 3:25 Sáng

if your good than you can outperform spy500 and it gets even better. if you spend so much time earning that money than why not spend time doing some research about individual companies

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Darkfuji 16/09/2021 - 3:25 Sáng

Tbh, sounds like super does this in Australia?

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cody tipp 16/09/2021 - 3:25 Sáng

Your doing a great job! Keep it up!

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Healthy On A Budget 16/09/2021 - 3:25 Sáng

Ooh first time I’ve heard of coast fire. Thanks for educating!

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cj james 16/09/2021 - 3:25 Sáng

I really need to invest more ahhhhhh

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choreomaniac 16/09/2021 - 3:25 Sáng

The big overlooked factor is marriage and kids. You achieve coast fire at 34. Quit your stressful job and stop investing. Then you get married and have 2 kids. Now your expenses are much higher. And what if your wife has 80k in student debt? And kids college?
And now your resume has a 5 year gap and you let your certifications lapse. And you want more comforts on vacation at 40 than 30.

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HoboTraderXAU 16/09/2021 - 3:25 Sáng

Thanks for this. I've been beating myself up about how I've managed my money since my 20s. I have my Coastfire number, but at 35, I could have been leanFIRE by now based on the previous market returns and my savings rate. I'm in the middle of a career turmoil/layoff and now I'm feeling the effects of my mistakes. I still am skeptical the market will continue its trajectory, but what choice do I have?

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tess is grateful 16/09/2021 - 3:25 Sáng

Thank you for the info 🙏✨

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Brian Velez 16/09/2021 - 3:25 Sáng

It’s crazy how compounding could set you free, specially if you start young. Thanks for the information!

I’ve been considering starting a financial channel, but seeing how awesome your content is and how often you post and yet still not being able to monetize makes it very discouraging. I may just go back to creating guitar tutorials, however, thank you for providing such valuable information!

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Drew Conway 16/09/2021 - 3:25 Sáng

Thank you—this is very helpful. I subscribed. 👍

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Pablo GR 16/09/2021 - 3:25 Sáng

If i have understood the equation, it has a pitfall. At a 2% inflation, in 30 years prices would have gone up by a 81% [(1,02^30)-1) x 100]. It means that in 30 years, 40k will value 7,6k of nowadays, and you will be poor. Correct me please if i am wrong. Thanks for the content.

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Julien Grenier 16/09/2021 - 3:25 Sáng

Apparently I already reached that number, weirdly I don't feel rich.

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Darcy Fitzpatrick 16/09/2021 - 3:25 Sáng

Bad news: $50k by the time that kid reaches 65 will be worth $21k in today’s money. When they’re 75, it’ll be $17k. If they want to live off $50k a year as a standard of today’s living and sustain that standard til they die, they should be aiming to retire 3x wealthier than what you setup for them here.

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Aisida Patrick 16/09/2021 - 3:25 Sáng

Only dollars is considered in these finance videos. Not everyone makes their money in dollars or lives in USA.

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cburton103 16/09/2021 - 3:25 Sáng

Great video! But saving 85% of your income only takes about 4-5 years to reach “full FIRE”. Saving about 65% of take home achieves FIRE in about a decade. Saving 50% gets you to FIRE in about 15 years.

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iamactuallyover18 16/09/2021 - 3:25 Sáng

Can you explain the difference between coast fire and barista fire?

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gabriel h 16/09/2021 - 3:25 Sáng

10k a year through my 20s is my goal

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michael fenell 16/09/2021 - 3:25 Sáng

One thing that I like about coast fire is that it gets people into investing. Currently I am 22, I can stop investing today and make about $80k each year from just my investments by the time I am 55. I am very lucky in my situation since my father pays all of my needs, along with college and a car. Since I was 20 I have invested about 95% of what I made since everything is paid for. I am not going to stop investing anytime soon, I just need to diversify a bit. I plan to do some more risky things, but they have greater returns. The only debt that I have is about $500 that I owe my father, and if anything drastic happens; that debt would be forgiven. I did not really plan to do FI or anything, I just did not like wasting my money. So I invested it, did some research on it and landed on Graham Stephen, Andri, and those people. It is kind of just of happened. Great video.

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Stupid Is The Norm 16/09/2021 - 3:25 Sáng

Great video mate. Wish I’d called my channel ‘5 minute finance’. Outstanding name and sums up what I do. Dammit ! 👏😀

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A Asdf 16/09/2021 - 3:25 Sáng

Pretty handy tool

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Andrew Llanes 16/09/2021 - 3:25 Sáng

Dude thanks you for this video. I've been looking for a middle ground for being not investing at all and saving and investing all of money

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Steph Liveright 16/09/2021 - 3:25 Sáng

Great content, but keep in mind you don't really know your retirement expenses until you've experienced some of life's experiences. (children, college, new cars, home repairs, etc)
If you think you will need $30k, you had better plan on needing $90k…

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SchmeddyBallz 16/09/2021 - 3:25 Sáng

The calculator you linked says that the investment growth rate is not inflation adjusted, so setting the inflation rate to 0 in your examples is not accurate. Unless I'm missing something.

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Trump Is a confirmed cuck 16/09/2021 - 3:25 Sáng

I'm at coastFI easily. 40 years old and almost half a million in retirement accounts. Plus my current job has a pension. Even if I were to quit it now and just work some other job that just pays the bills has no pension and I didn't add any additional savings:

By 55 I should have between $900,000 – $1.4 million in my retirement accounts + around a $900/month pension. I played with the rate of returns a bit (why I got different numbers).

By 65 I should have $1.5 million – $2.9 million + around $1300/month pension (plus social security at that point obviously).

I don't feel good. I want to retire now. I hate working. I mean I feel better than if I was at $0. but I don't want to coast fire. I want to retire.

I don't have a sense of freedom right now.

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A Muse In the craftroom 16/09/2021 - 3:25 Sáng

Dig that calculator! Piece of mind achieved:)

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OrdinaryHuman 16/09/2021 - 3:25 Sáng

I think the problem with coast FIRE in this sense is that it doesn't really do anything for those 30+ years leading up to the traditional retirement age. You basically just gave yourself a minimal pension… which you already had in the form of social security. And since your coasting for the next 30 years still requires earning the $40k/$50k you need to pay for expenses, that means you have decades of SS contributions to bump up those eventual SS earnings.

So it might be easy to achieve, but that's because it doesn't require much… and as a result, it also doesn't accomplish much either.

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