Coast FIRE Formula Explained
The Coast FIRE formula answers a simple question:
The formula is:
That may look complicated at first.
It is really just working backward.
If you know:
- how much you want the model to reach;
- how many years the money has to grow;
- and what annual growth rate you want to test;
the formula calculates the amount needed at the starting point.
Let's use one simple example all the way through.
A Simple Coast FIRE Example
Meet Maya.
Maya is 35 years old and wants to model retirement at 65.
For this example, she enters:
| Input | Example |
|---|---|
| Current age | 35 |
| Retirement age | 65 |
| Retirement spending | $60,000/year |
| Withdrawal-rate assumption | 4% |
| Growth assumption | 5% real |
| Years until retirement | 30 |
Now we can calculate the result.
Step 1: Find the Retirement Target
Maya first needs a retirement portfolio target.
One way a calculator can create that target is:
Using Maya's example:
So the retirement target used in this example is:
This does not mean everyone spending $60,000 needs $1.5 million.
It simply means that $1.5 million is the result produced by the 4% assumption entered into this example.
Change that assumption and the target changes.
For example:
| Selected withdrawal rate | Target from $60,000 spending |
|---|---|
| 3% | $2,000,000 |
| 4% | $1,500,000 |
| 5% | $1,200,000 |
The Coast FIRE formula itself does not choose one of these percentages.
It only uses the target supplied to it.
Step 2: Count the Years Until Retirement
Maya is 35.
Her modeled retirement age is 65.
So:
Her investments therefore have 30 years to grow in this example.
Time is important because compound growth builds on earlier growth.
Investor.gov, operated by the U.S. Securities and Exchange Commission, defines compound interest as interest paid on both the original principal and accumulated interest.
Investor.gov also provides a compound-interest calculator where users can change the starting amount, time period, contributions, and estimated interest rate.
Coast FIRE uses the same basic idea, but works backward from a future target.
Step 3: Work Backward to Today
Maya's modeled retirement target is:
She has:
And this example tests:
So:
The result is approximately:
That is Maya's modeled Coast FIRE number today under these exact assumptions.
If $347,066 grew at exactly 5% per year for 30 years, the mathematical result would be about $1.5 million.
The calculation is exact for the inputs entered.
Actual investment returns do not follow one fixed percentage every year. Investor.gov describes investment returns as uncertain and its own calculator calls the rate an estimated interest rate, even allowing users to test a range around that estimate.
Check the Formula by Running It Forward
There is an easy way to check the calculation.
We calculated:
Now grow that amount forward for 30 years:
We arrive back at the retirement target.
That is useful because it shows what the formula is actually doing.
Money today → compound growth → future target
Future target → discount for compound growth → money needed today
The second version is the Coast FIRE formula.
What Does Each Part of the Formula Mean?
Let's make each part simple.
Retirement Target
This is the amount the model is trying to reach at retirement.
A calculator might derive this from retirement spending and a withdrawal-rate assumption, or the user might enter a target directly.
Growth Rate
This is the annual rate being tested in the calculation.
It is an assumption, not a prediction. Changing it changes the Coast FIRE result.
Years Until Retirement
This is:
For Maya: 65 − 35 = 30
More years give the modeled amount more time to compound. Fewer years give it less time.
Why the Coast FIRE Number Changes With Age
This part surprises many people.
Suppose Maya keeps the exact same:
- $1.5 million retirement target;
- age 65 retirement date;
- 5% growth assumption.
Her Coast FIRE target changes as she gets older.
| Current age | Years left until 65 | Coast FIRE number |
|---|---|---|
| 30 | 35 | $271,935 |
| 35 (Maya's Baseline) | 30 | $347,066 |
| 40 | 25 | $442,954 |
| 45 | 20 | $565,334 |
| 50 | 15 | $721,526 |
Why does the number rise?
Because there is less time left.
At age 30, the money gets 35 years to grow.
At age 50, it gets only 15 years.
The future target did not change.
The amount needed at the starting point changed because the growth period became shorter.
This is why your Coast FIRE target is not necessarily one fixed dollar amount for life.
The Formula Does Not Tell You Which Return Rate to Use
This is an important distinction.
The formula accepts a growth rate.
It does not determine one.
For the same $1.5 million target and 30-year period, different inputs produce different mathematical results.
| Growth assumption | Coast FIRE result |
|---|---|
| 3% | $617,980 |
| 4% | $462,478 |
| 5% (Maya's Baseline) | $347,066 |
| 6% | $261,165 |
| 7% | $197,051 |
These are scenario calculations, not forecasts.
That difference is large enough that the growth assumption should always be visible next to the result.
This is also one of the most common questions in Coast FIRE communities. A July 2026 Reddit discussion asked what return people were using, with participants giving several different answers and some preferring to compare a range rather than one figure.
Reddit is useful here for identifying the question people are asking, not for deciding what rate is correct.
What About Inflation?
Inflation means that prices change over time.
The U.S. Bureau of Labor Statistics defines the Consumer Price Index, or CPI, as a measure of the average change over time in prices paid by consumers for a representative basket of goods and services. BLS also explains that CPI can be used to translate dollar values into inflation-adjusted dollars.
For Coast FIRE calculations, the important point is consistency.
If retirement spending is written in today's purchasing power, the model can use an inflation-adjusted, or real, growth assumption.
If the model uses future dollar amounts, it can instead work with nominal values.
The calculator should not quietly mix the two.
A Current Inflation Example
For context, BLS reported that the CPI-U was 3.4% higher in July 2026 than a year earlier.
That is a current economic measurement.
It is not a forecast for the next 20 or 30 years and should not automatically become a long-term Coast FIRE assumption.
That distinction matters because a Coast FIRE calculation may cover several decades.
Why Two Coast FIRE Calculators Can Give Different Answers
Two calculators can start with the same age and savings balance and still show different Coast FIRE numbers.
Usually, the difference comes from the assumptions.
Check whether both calculators use the same:
- • retirement age;
- • retirement spending;
- • withdrawal-rate assumption;
- • investment-growth assumption;
- • inflation treatment;
- • investment fees;
- • current invested assets.
Current Coast FIRE calculators do not all handle these inputs in exactly the same way. Some use one return directly, while others calculate an inflation-adjusted return from separate nominal-return and inflation inputs.
So comparing two final numbers without comparing their assumptions can be misleading.
Does the Coast FIRE Formula Include Future Contributions?
The basic Coast FIRE number shown in this article does not include future contributions.
It asks:
Future contributions answer a different question:
A calculator can model both.
But they should not be mixed together.
What Assets Go Into the Formula?
Technically, the Coast FIRE formula calculates a target.
Your current investment balance is then compared with that target.
The formula itself does not decide whether a house, savings account, pension, 401(k), IRA, or brokerage account belongs in your retirement assets.
That depends on how the calculator defines and models those assets.
For a clear result:
The calculator should show exactly which balances are included rather than silently treating total net worth as retirement investments.
Common Coast FIRE Formula Mistakes
Using the Wrong Number of Years
If someone is 35 and models retirement at 65: 65 − 35 = 30 years. Not 35 years.
Treating a Return Assumption as a Promise
A fixed percentage is an input to the equation. It is not a statement about what investments will actually return.
Mixing Today's Dollars and Future Dollars
The inflation treatment and growth rate need to use the same framework.
Using Today's Coast Number Forever
The Coast target changes as the remaining number of years changes.
Confusing the Retirement Target With the Coast FIRE Number
They are not the same. In Maya's example: Retirement target = $1,500,000, while Coast FIRE number at age 35 = $347,066. One is the future target. The other is today's modeled value of that target.
Frequently Asked Questions
What is the Coast FIRE formula?↓
Coast FIRE Number = Retirement Target ÷ (1 + Growth Rate)^Years Until Retirement. It works backward from a future retirement target to calculate an equivalent starting amount under the selected assumptions.
Why does my Coast FIRE number change every year?↓
Because the number of years until retirement changes. With fewer years available for compound growth, the starting amount required to reach the same future target becomes larger.
Is 7% required in the Coast FIRE formula?↓
No. The formula does not require a specific growth rate. A calculator can test different user-entered rates, and each rate produces a different result.
Is the Coast FIRE number the same as the FIRE number?↓
No. The retirement target is the future amount being modeled. The Coast FIRE number is the amount today that would mathematically grow to that future target under the selected assumptions.
Why do different Coast FIRE calculators give me different numbers?↓
They may be using different retirement ages, withdrawal-rate assumptions, return rates, inflation methods, fees, or asset definitions.
Does the Coast FIRE formula include future contributions?↓
The basic Coast FIRE target does not. Future contributions can be modeled separately to estimate when a portfolio might reach the target.
The Bottom Line
The Coast FIRE formula is simpler than it looks.
For Maya's example:
- Age: 35
- Retirement age: 65
- Retirement target: $1,500,000
- Growth assumption: 5% real
- Time: 30 years
The calculation gives:
That number does not say Maya is financially secure, ready to retire, or able to stop contributing.
Change any input and the result changes.
That is why a useful Coast FIRE calculator should always show the assumptions next to the answer.
Calculate Your Coast FIRE Number
Use the Coast FIRE Calculator to enter your own current age, retirement age, retirement spending, current investments, growth assumption, inflation assumption, and withdrawal-rate assumption.
Then see the modeled Coast FIRE target and how it changes when the inputs change.
Sources & Research
Compound Interest Calculator
Consumer Price Index (CPI)
Community Discussions
Safe Withdrawal Rate Study