Updated: Jun 24
Create the future you want. FIRE is all about spending more time on hobbies, volunteering, teaching, travelling! Do what makes you happy!
FIRE has different meanings to everyone. Over time, the concept has evolved, there are several types of FIRE philosophies.
FIRE is not a one-size fits all solution. It can be customized to suit your situation so that you can achieve your dreams.
Some Common FIRE Philosophies that exist:
LeanFIRE is a minimalist philosophy. The aim is to generate around $25,000 - $35,000 of annual investment income. This is enough income to maintain a minimalist lifestyle, without taking a job or investing further.
BaristaFIRE is a step between CoastFIRE and LeanFIRE. You have a growing investment nest egg but it is not generating enough to maintain your desired lifestyle. Investment earnings are often supplemented by a part-time job, hence the Barista moniker. This is a great way to test the waters of early retirement, not having to work full-time. This is a happy medium of earning from investments as well as part-time work.
CoastFIRE is when there is enough of a principal investment that the investment can coast along, earning enough over time to achieve your desired principal value at retirment age. CoastFIRE involves parking the principal investment amount and not drawing from it until retirement. This is a comfortable place, knowing that your retirement will be taken care of without having to make additional investments.
FatFIRE is the ability to retire early without making any significant changes. FatFIRE involves having a large invested principal, that can provide annual revenues to furnish a very comfortable lifestyle. Generally, only high net worth individuals fall into this category.
It is important to follow the FIRE philosophy that will best align with your desired goals and lifestyle. A minimalist lifestyle is more attainable, and a more lavish one will require additional investments and other sources of revenue.
Whether you want enough to travel each year, or you're happy to just have your living expenses covered each month, there's a FIRE philosophy for every situation.