Calculating your FIRE number PART III: The CoastFI Calculator

If you’ve read the Types of FIRE post you’ll have a good understanding of the CoastFIRE flavour of FI. One in which involves reaching a point where your investments can grow over time to cover your expenses at traditional retirement age without any further contributions.

If you’re interested in retiring at typical retirement age of 60, 65, or even 67 there is power in knowing your CoastFI number. If you’re now 25 years old and plan to retire at the age of 65 given a 4% withdrawal rate, and a 7% real growth rate on your investments you’ll need about $166,000 invested today to have $2.5MM available to you at 65 thanks to the power of compound interest.

With this knowledge you may adopt a slightly different spending pattern and lifestyle in your working years once you’ve reached this number. Perhaps you can spend a little more knowing that you’ve saved and invested ‘enough’ for a comfortable retirement. To live life and enjoy just a little more earlier in your healthspan without any of the financial stress of saving for retirement.

How do you know if you’re reached CoastFI?

With the calculator below enter the following inputs:

• Your Current Age
• Your Target Retirement Age
• Expected Annual Expenses in Retirement
• Any Annual Passive Cash Flow Expected in Retirement (i.e. Social Security)
• Anticipated Withdrawal Rate in Retirement
• Expected Annual Inflation Adjusted (Real) Investment Return

And as simple as that you’ll generate your required investment amount today to hit your target FI number at your defined retirement age.

CoastFI Calculator

Before you go….

By now you know we don’t have any sponsorships (yet)….So an affiliate link instead to help drive the mission for democratizing financial knowledge and freedom.

This time a book! Bill Bengen is often referred to as the founder of the 4% rule. He has authored an updated and revised version of his original book which includes new research to challenge the traditional 4% rule. It’s perhaps possible to withdraw even up to 4.7% per year safely with his new findings. You can read all about it in A Richer Retirement: Supercharging the 4% Rule to Spend More and Enjoy More