Coast Fi Calculator

by

Coast FI Calculator

Use this calculator to determine if you've reached your "Coast FI" number, meaning you've saved enough in your retirement accounts that, without any further contributions, your investments will grow to your desired financial independence (FI) sum by your target retirement age.

function calculateCoastFI() { var currentSavings = parseFloat(document.getElementById('currentSavings').value); var currentAge = parseFloat(document.getElementById('currentAge').value); var desiredRetirementAge = parseFloat(document.getElementById('desiredRetirementAge').value); var desiredAnnualSpending = parseFloat(document.getElementById('desiredAnnualSpending').value); var growthRate = parseFloat(document.getElementById('growthRate').value); var resultsDiv = document.getElementById('coastFIResults'); resultsDiv.innerHTML = "; // Clear previous results // Input validation if (isNaN(currentSavings) || currentSavings < 0) { resultsDiv.innerHTML = 'Please enter a valid Current Retirement Savings amount.'; return; } if (isNaN(currentAge) || currentAge = desiredRetirementAge) { resultsDiv.innerHTML = 'Please enter a valid Current Age (must be less than Desired Retirement Age).'; return; } if (isNaN(desiredRetirementAge) || desiredRetirementAge 99) { resultsDiv.innerHTML = 'Please enter a valid Desired Retirement Age (must be greater than Current Age).'; return; } if (isNaN(desiredAnnualSpending) || desiredAnnualSpending <= 0) { resultsDiv.innerHTML = 'Please enter a valid Desired Annual Retirement Spending amount.'; return; } if (isNaN(growthRate) || growthRate 20) { resultsDiv.innerHTML = 'Please enter a valid Expected Annual Investment Growth Rate (e.g., 7 for 7%).'; return; } var yearsToGrow = desiredRetirementAge – currentAge; var growthRateDecimal = growthRate / 100; // Calculate Desired FI Number (using the 4% rule inverse: 25x annual spending) var desiredFINumber = desiredAnnualSpending * 25; // Calculate Future Value of Current Savings var futureValueCurrentSavings = currentSavings * Math.pow((1 + growthRateDecimal), yearsToGrow); // Calculate Required Current Savings to reach Desired FI Number var requiredCoastFINumber = desiredFINumber / Math.pow((1 + growthRateDecimal), yearsToGrow); var statusMessage = "; if (currentSavings >= requiredCoastFINumber) { statusMessage = 'Congratulations! You have reached your Coast FI number! Your current savings are projected to grow to ' + futureValueCurrentSavings.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + ' by your desired retirement age, exceeding your target of ' + desiredFINumber.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + '.'; } else { var shortfall = requiredCoastFINumber – currentSavings; statusMessage = 'You are currently short of your Coast FI goal by approximately ' + shortfall.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + '. Your current savings are projected to grow to ' + futureValueCurrentSavings.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + ' by your desired retirement age, which is less than your target of ' + desiredFINumber.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + '. You would need to save an additional ' + shortfall.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + ' today, or continue contributing to your savings, to reach your desired FI number without further contributions after today.'; } resultsDiv.innerHTML += '

Coast FI Calculation Results:

'; resultsDiv.innerHTML += 'Your Desired FI Number (at ' + desiredRetirementAge + ' years old): ' + desiredFINumber.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + ''; resultsDiv.innerHTML += 'Your Current Savings (' + currentSavings.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + ') will grow to approximately: ' + futureValueCurrentSavings.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + ''; resultsDiv.innerHTML += 'To reach your Desired FI Number, you needed to have saved approximately: ' + requiredCoastFINumber.toLocaleString('en-US', { style: 'currency', currency: 'USD', maximumFractionDigits: 0 }) + ' by today.'; resultsDiv.innerHTML += statusMessage; } .calculator-container { font-family: 'Segoe UI', Tahoma, Geneva, Verdana, sans-serif; background-color: #f9f9f9; padding: 25px; border-radius: 10px; box-shadow: 0 4px 12px rgba(0, 0, 0, 0.1); max-width: 700px; margin: 20px auto; border: 1px solid #e0e0e0; } .calculator-container h2 { color: #2c3e50; text-align: center; margin-bottom: 20px; font-size: 28px; } .calculator-container p { color: #34495e; line-height: 1.6; margin-bottom: 15px; } .calculator-inputs label { display: block; margin-bottom: 8px; color: #34495e; font-weight: bold; } .calculator-inputs input[type="number"] { width: calc(100% – 22px); padding: 12px; margin-bottom: 15px; border: 1px solid #ccc; border-radius: 5px; font-size: 16px; box-sizing: border-box; } .calculator-inputs button { background-color: #28a745; color: white; padding: 14px 20px; border: none; border-radius: 5px; cursor: pointer; font-size: 18px; width: 100%; display: block; margin-top: 20px; transition: background-color 0.3s ease; } .calculator-inputs button:hover { background-color: #218838; } .calculator-results { margin-top: 30px; padding: 20px; background-color: #e9f7ef; border: 1px solid #d4edda; border-radius: 8px; color: #155724; } .calculator-results h3 { color: #2c3e50; margin-top: 0; margin-bottom: 15px; font-size: 22px; border-bottom: 2px solid #d4edda; padding-bottom: 10px; } .calculator-results p { margin-bottom: 10px; font-size: 17px; } .calculator-results p strong { color: #0056b3; } .calculator-results .success { color: #155724; background-color: #d4edda; border-color: #c3e6cb; padding: 10px; border-radius: 5px; font-weight: bold; } .calculator-results .warning { color: #856404; background-color: #fff3cd; border-color: #ffeeba; padding: 10px; border-radius: 5px; font-weight: bold; } .calculator-results .error { color: #721c24; background-color: #f8d7da; border-color: #f5c6cb; padding: 10px; border-radius: 5px; font-weight: bold; }

Understanding Coast FI: Your Path to Early Financial Independence

The concept of Financial Independence (FI) has gained significant traction, offering a roadmap to a life where work is optional. Within the broader FI movement, "Coast FI" stands out as a particularly appealing milestone. It's about reaching a point where you've saved enough in your retirement accounts that, without any further contributions, your investments will grow to your desired financial independence sum by your traditional retirement age, purely through the power of compound interest.

What is Coast FI?

Imagine you're in your 20s or 30s, you've diligently saved a substantial amount in your 401(k) or IRA, and then you decide you want to pursue a less stressful career, work part-time, or even take a sabbatical. If you've hit your Coast FI number, you can do exactly that. You no longer need to contribute to your retirement accounts because the money you've already saved is projected to grow sufficiently to meet your retirement goals by itself.

This doesn't mean you're financially independent *today*. It means you're financially independent *in the future*, without needing to make additional savings contributions from this point forward. You still need to cover your living expenses until your desired retirement age, but the pressure to save for retirement is off.

Why is Coast FI a Powerful Concept?

  • Reduced Financial Stress: Knowing your future retirement is secured can significantly reduce anxiety about money.
  • Career Flexibility: It opens doors to pursuing passion projects, taking lower-paying but more fulfilling jobs, or even working part-time.
  • Early "Semi-Retirement": While not full FI, it allows for a form of "semi-retirement" where you work for enjoyment and to cover current expenses, not to build your nest egg.
  • Motivation: Reaching Coast FI can be a huge motivator, showing tangible progress towards full financial independence.

How the Coast FI Calculator Works

Our Coast FI Calculator helps you determine if you've reached this crucial milestone. It uses a few key inputs to project the future value of your current savings and compare it against your desired financial independence goal.

Input Definitions:

  • Current Retirement Savings ($): This is the total amount you currently have saved in all your retirement accounts (e.g., 401k, IRA, Roth IRA, etc.). Be as accurate as possible.
  • Your Current Age (Years): Your age today.
  • Desired Retirement Age (Years): The age at which you ideally want to stop working full-time and live off your investments.
  • Desired Annual Retirement Spending ($): The estimated amount of money you believe you'll need to spend annually in retirement to maintain your desired lifestyle. This is a critical number for determining your overall FI goal.
  • Expected Annual Investment Growth Rate (%): This is the average annual return you anticipate your investments will generate. A common historical average for diversified portfolios is 7% after inflation, but you can adjust this based on your risk tolerance and investment strategy.

The Calculation Logic:

The calculator primarily uses the future value formula for compound interest:

FV = PV * (1 + r)^n

  • FV (Future Value): The amount your money will grow to.
  • PV (Present Value): Your Current Retirement Savings.
  • r (Rate): Your Expected Annual Investment Growth Rate (as a decimal).
  • n (Number of Periods): The number of years until your Desired Retirement Age.

First, it calculates your Desired FI Number by multiplying your Desired Annual Retirement Spending by 25 (based on the common 4% rule, where you can safely withdraw 4% of your portfolio annually). Then, it determines how much your Current Retirement Savings will grow to by your desired retirement age. Finally, it calculates the Required Current Savings you would need today to reach your Desired FI Number. By comparing these figures, the calculator tells you if you've hit Coast FI and by how much you might be ahead or behind.

Example Scenario:

Let's say you are 30 years old with $100,000 in retirement savings. You want to retire at 60, needing $50,000 per year in retirement, and expect a 7% annual growth rate.

  • Current Retirement Savings: $100,000
  • Current Age: 30
  • Desired Retirement Age: 60
  • Desired Annual Retirement Spending: $50,000
  • Expected Annual Investment Growth Rate: 7%

Based on these inputs, the calculator would show:

  • Desired FI Number: $50,000 * 25 = $1,250,000
  • Years to Grow: 60 – 30 = 30 years
  • Future Value of Current Savings: $100,000 * (1 + 0.07)^30 ≈ $761,225
  • Required Current Savings for Desired FI: $1,250,000 / (1 + 0.07)^30 ≈ $164,209

In this example, your current savings of $100,000 are less than the $164,209 needed to be Coast FI. You would be approximately $64,209 short of your Coast FI goal, meaning you would need to continue contributing to your retirement accounts to reach your desired FI number by age 60.

Important Considerations:

  • Inflation: The calculator uses a nominal growth rate. For a more conservative estimate, you might use a real (inflation-adjusted) growth rate (e.g., 7% nominal – 3% inflation = 4% real).
  • Taxes: This calculator does not account for taxes on withdrawals in retirement, which can impact your net income.
  • Healthcare Costs: These can be significant in retirement and should be factored into your desired annual spending.
  • Market Volatility: Investment returns are not guaranteed and can fluctuate. The expected growth rate is an average.

The Coast FI Calculator is a powerful tool for planning your financial future. By understanding where you stand, you can make informed decisions about your savings, career, and lifestyle to achieve your financial goals sooner.

Leave a Comment