10 Reasons You Might Decide to Coast to Financial Independence Instead of Pursuing FIRE

What is Coast FI?

Coasting to financial independence is a conscious decision to delay your FI date in exchange for some additional freedom and flexibility now. It is a slower path to FI but arguably a more enjoyable and sustainable one.

“It’s a branch of the traditional FIRE movement where you front-load retirement savings to reach a certain amount, then take your foot off the gas. This allows compounding to do the heavy lifting while you coast, working part-time or flexibly to cover living expenses.”

“With Coast FIRE, you no longer need to worry about saving for retirement since your nest egg will grow to what you need to become fully financially independent at a future date.”

It involves a sobering look at the tradeoff between complete financial independence and a modified — but more attainable — version of FI that still involves working, albeit on your terms.

There are many reasons you might choose to coast to financial independence, so let’s explore a few.

1. You have young kids.

When my daughter was born, I knew that things had to change. I was working for a fintech startup that needed me 50–60 hours per week, and although I was making more money than I had ever made, I decided it was time to walk away. So I made the difficult decision to quit my job when I became a dad, allowing me to work more flexibly while being the involved parent I wanted to be.

Luckily, I had been pursuing financial independence for the past decade and was in a position to take my foot off the gas and begin coasting, freeing up more time for family while my investments did the heavy lifting in the background.

If you’ve got young kids and want to take full advantage of the precious moments you have right now, coasting to financial independence can be a great option. Coasting allows you to access many of the benefits of a FI lifestyle now, rather than sacrificing your time now to reach full FIRE sooner and missing the opportunity to spend time with your young kids.

2. You are feeling burned out.

Many people have burned out on the path to FIRE — focusing too much on the destination or FI number while forgetting to enjoy life now. For those that have started to feel burned out, either from overwork or extreme frugality, coasting may be a great option.

Coasting emphasizes the journey to FI rather than the destination, allowing you to loosen up a bit and enjoy life now. By coasting, you decide to delay your ultimate FI deadline in exchange for a more rich and fulfilled life today.

So, rather than focusing on areas of your life that you can cut back to reach FI quicker, coasting puts the focus on what you could be doing with your life right now to enjoy the path even more while working part-time or flexibly to cover your living expenses.

The beauty of coasting is that your investments continue to work in the background, ultimately still reaching your FI number at a future date while offering the ability to live it up now.

3. You have aging parents.

If you’ve got aging parents, you understand that your remaining time together is limited. Deciding to coast to financial independence can free up a lot of time now, allowing you to spend that time with your aging parents while you still can.

The alternative is continuing to pursue full FIRE — grinding at your current job and slashing your expenses to the bone, which can limit both the amount of time you have to spend, as well as limiting your ability to travel to see your aging parents as needed.

4. You want to travel while you’re young.

The old retirement model is to work hard for 40 years, head down, plugging away, and then enjoy traveling the world during your “golden years” starting at age 65. While many in the FIRE community know that’s not what they want to do, they might still be delaying travel longer than they have to.

If you’re pursuing full FIRE, you might spend the bulk of your 20’s and 30’s with your head down, working hard, doing everything you can to achieve your FI number by your 40’s, missing out on some prime travel years.

Coasting allows you to downshift your work much earlier, letting your investments ride in the background while you work flexibly to cover living expenses now. This can free you up to do more significant travel during your 20’s and 30’s, some of your prime years in terms of health, adventure, limited responsibility, and desire to travel.

5. You’re feeling socially isolated.

One of the most common issues I have seen in the FIRE community is people slashing expenses to extreme ends, forcing them to make some radical lifestyle decisions, potentially leading to social isolation.

For some, this could be as simple as choosing not to hang with their friend group because they “don’t want to spend money” to choosing to live at home with parents, despite it negatively impacting their social connections and prospects.

This is not to say you need to spend money to have social connections. You don’t. Instead, this is just a call to those feeling socially isolated on the path to FIRE—it doesn’t have to be this way, and coasting offers an alternative.

Coasting takes the focus off of your FI number and date and places it on the lifestyle you want to live now while working flexibly to cover your living expenses. This allows you to add back the things that bring you social connection and fulfillment, leading to a more balanced and well-rounded life.

6. You feel deprived.

If you’re feeling deprived on the path to FIRE, you aren’t doing it right. Pursuing FIRE is meant to bring a more fulfilling and enriched lifestyle, not a feeling of deprivation and extreme frugality. If you’ve found that pursuing FIRE is causing you to take frugality to extreme ends, it may be time to downshift to coast FIRE, enjoying yourself more along the way.

By pursuing coast FI, you will take the stress off of achieving FI as quickly as possible no matter the cost, allowing you the space to enjoy yourself on the journey to FI.

7. You are interested in pursuing more fulfilling work now.

Coasting to financial independence allows you to get creative with your work since you only need to cover your living expenses. This means that you might decide to leave your high-paying but stressful job to pursue less stressful, or simply more meaningful, work.

There are many different work opportunities while coasting to FI, but the best fit for you will come down to your unique interests and desired combination of compensation, stress level, flexibility, and autonomy.

Coasting to FI can also be an excellent opportunity to start a freelance, consulting, or independent contractor gig, allowing you to be in complete control of your schedule as well as offering you the ability to scale your income up or down as you wish.

8. You see yourself working even after FI.

The way I look at it, if you plan to continue working after you reach financial independence, then you might as well be coasting. Coasting allows you to access many benefits of a FI lifestyle now, without delaying until you reach your ultimate FI number. Of course, the tradeoff is that you will need to work to cover living expenses, but if you plan on working after FI anyways, then coasting is the way to go.

And if you don’t see yourself working after reaching financial independence, you may be in for a surprise. Many people decide to continue working after reaching FI because work can provide many tangible and intangible benefits to our lives.

Plain and simple: most people will still work after FI—they will just work flexibly and on their terms. My recommendation is that rather than working like crazy to reach FI, then realizing you will want to work flexibly from there on out, you simply start coasting now, working flexibly now, and enjoying yourself along the way.

9. You believe the journey is just as important as the destination.

If you’re focused on the rainbow rather than the pot of gold, coast FI is for you. Coasting offers you the ability to enjoy a slow and steady approach to financial independence, rather than an all-out blitz, binge and purge relationship with work that many take to extreme ends on the path to FIRE.

Coasting offers you the opportunity to take back control of your time much sooner than traditional FIRE by recognizing two key things:

1. Compounding will do amazing work for your nest egg over long periods, and

2. You can live a FI lifestyle now while working flexibly to cover your living expenses

As someone that decided to pursue coast FI after working towards traditional FIRE for a decade, I know the shift it can make in your life and the happiness it can bring. Coasting allows you to savor the precious moments you have right now, rather than trading them for a future freedom date, putting more focus on the journey rather than the destination.

10. You started saving and investing early.

If you were lucky enough to start saving and investing from a young age, you might be well on your way to achieving coast FI. Coasting to financial independence becomes much easier the younger you are because it gives your assets a long time to grow and compound on your behalf.

Depending on your future retirement income needs and desired retirement date, you may be able to reach your coasting number in your 20’s with as little as $100–150k invested. To determine your exact coasting needs, check out this free coast FI calculator from Andrew over at Walletburst.com.

So there you have it, 10 reasons you might decide to coast to financial independence instead of pursuing FIRE.

Let me know what you think in the comments below!