You may have heard of the “FIRE” movement – financial independence retire early – but what about “Coast FI”?
The retirement strategy helps you figure out how much you need to save by what age so you supposedly never have to make another retirement account contribution again. Over time, compounding interest increases those savings to the dollar amount needed to sustain retirement years.
Not only does Coast FI alleviate fears about retirement, but it offers career flexibility for those who hit their number, according to Geoff Schmidt, certified public accountant and founder of retirement education hub Holy Schmidt!
“The real benefit is what that does for you later,” Schmidt told The Independent in an email. “You might be able to leave the high-paying job that makes you miserable and pursue that ‘good for the soul’ career you always wanted, without giving up the retirement you planned for.”
Coast FI is a little less intense than the FIRE movement, which requires followers to save and invest as much of their paycheck as possible so they can retire early with some people doing so in their thirties and forties. The movement has dozens of books, blogs, and social media channels devoted to it.
Jessica Fick was an early proponent of Coast FI. She and her husband Owen realized back in 2019 that their retirement savings were already enough to give them a comfortable income in each year of retirement. Fick says the couple essentially stumbled on Coast FI by mistake, realizing they hit their number after the fact, and that “only a few people in the FI community were talking about it“ at that time.
“This idea was transformational for me, and I wondered why I’d never heard about it before,” Fick wrote in a 2020 blog post.
Coast FI is catching on among younger generations, particularly Gen Z.
“For Gen Z, financial freedom isn’t about owning a house. It’s about owning your time – that’s where ‘Coast FI’ comes in,” Gen Z financial educator Taylor Price said in a November 2025 MarketWatch article.
“The goal isn’t to stop working; it’s to stop being trapped by work. Most people work until they can afford to quit. Coast FI flips that: Your future is secured, so you work because you want to, not because you have to. That’s true financial freedom.”
America’s youngest working adults are more on track for their senior years than any other generation and grew their IRA contributions by 65 percent in the past year.
If a 25-year-old with no retirement savings wanted to reach their Coast FI number in five years time, and put themselves on track to retire at 65 with $1.5 million, this is how the calculation works (putting an annual rate of return on retirement accounts at a conservative 5 percent.)
- $1.5 million ÷ (1+5% return)35 = $272,000
The equation’s steps are:
- Add the expected 5-percent return to 1 to get 1.05.
- Multiply 1.05 by the power of 35, which represents the difference between the desired retirement age and the age when the saver hits their Coast FI number, to get 5.516
- Divide that number, 5.516, into $1.5 million to get around $272,000.
Over 35 years, that 5 percent annual return would slowly grow $272,000 to $1.5 million with no additional contributions. Increasing the Coast FI age to 40 would raise the goal from $272,000 to $443,000 because interest has fewer years to grow the account.
If you had $50,000 already saved for retirement at 25, you’d need to save an additional $209,000 to reach the Coast FI goal by 30.
As simple as the concept seems, some financial experts sound a note of caution. Certified financial planner Adam Van Deusen warns that your amount needed for retirement, rate of return and time horizon could change over time.
“If any of these elements change unexpectedly, a client’s ability to meet their financial goals could be jeopardized either during their remaining working years or in retirement,” Van Deusen wrote.
If life happens and someone suffers a long-term illness, for example, they could need more money in retirement for healthcare. That illness could also require someone to retire earlier than expected.
“While clients may have a target age in mind, unforeseen circumstances (e.g., health challenges) can accelerate that timeline, reducing the number of years available for compounding,” Van Duesen wrote.
However, according to Schmidt, for those worried their Coast number may not be sufficient there’s an easy solution.
“There’s nothing stopping you from reaching your Coast FI number and continuing to save a little anyway,” Van Duesen said. “That gives you a cushion if your assumptions turn out to be wrong.”