Young investors are putting FIRE on ice — and are now choosing to ‘coast’ into retirement. How they’re making it work without a life of deprivation

According to a 2026 Northwestern Mutual study, on average Gen Zers started saving for retirement at 22, with the goal of retiring by 61. That’s compared to Millennials who began saving at 28 and plan to retire at 64 and Gen X, who started saving at 32, with the goal of retiring by 67.

Saving as early as possible expands lifestyle opportunities

With their sights set on early retirement, younger workers are taking more aggressive approaches to savings, particularly their long-term savings plans.

The FIRE movement, short for “financial independence, retire early,” is among the most aggressive saving plans. The most intense version requires someone to save or invest the majority of their income, as well as doing things like finding new streams of income or delaying life milestones.

The plan is, of course, deeply restrictive and has paved the way for a newer retirement savings plan called “Coast FIRE.” Young people are taking a page from the FIRE movement but with a major caveat.

In a nutshell, Coast FIRE is a simple middle-ground strategy between the more aggressive FIRE and traditional retirement-plan strategies.

The idea behind Coast FIRE is simple: save and invest aggressively when you’re younger, until your retirement portfolio reaches a certain size. Once you hit that “Coast FIRE number,” there’s no longer a need to make significant retirement contributions. Instead, you let compound growth do the heavy lifting while continuing to work to cover current living expenses.

Unlike the traditional FIRE savings model, where a career professional exits the workforce in their 40s, Coast FIRE emphasizes reaching a financial savings point where your retirement is essentially on autopilot, giving you more flexibility to work fewer hours, change careers, launch a business or side gig and, perhaps most importantly, curb any lingering financial stress about retirement savings.

“Coast FIRE works best for young investors in their 20s and 30s,” Michael Martin, vice president of market strategy at TradingBlock, told Moneywise. “To build wealth, you have to start early.”

The key is getting started as soon as possible. “If you begin saving in your early 20s, there’s a good chance that by your late 30s your portfolio will be making more from market gains in a typical year than you’re adding through new contributions,” Martin noted. “That’s when the power of compounding becomes apparent.”

The Coast FIRE roadmap

The Coast FIRE roadmap is clear-cut, prioritizing early investing with old-fashioned savings discipline.

For example, let’s say Leslie, a project manager at a technology firm, is 35 years old and wants to retire at 65. Leslie estimates she’ll need about $1.5 million saved up by retirement.

Assuming her investments grow at roughly 7% annually, Leslie calculates that she needs approximately $200,000 invested today to reach that future goal through compound growth (via accelerated interest) alone.

Once Leslie reaches that $200,000 mark, her life choices expand significantly. Not only does she no longer have to contribute to her 401(k) or IRA, but she can also remain on the job and earn enough cash to cover her mortgage, groceries, travel and other living expenses. Meanwhile, Leslie’s retirement portfolio, now on autopilot, continues growing untouched for the next 30 years.

If the stock market does its job and delivers a 7% average annual return, that $200,000 could grow to more than $1.5 million by age 65 without another dollar of retirement contributions.

Coast FIRE often comes with risks, too

One potential downside of Coast FIRE is that the market doesn’t carry its end of the deal and produce the needed investment results.

“For the S&P 500, annual returns have averaged roughly 10% over the past 50 years,” Martin noted. “It’s important to keep in mind, however, that valuations are currently meteoric by historical standards.”

The primary risk is that most Coast FIRE calculators assume a 7% nominal annual return, which, after 2% inflation, is roughly 5% in real terms.

“Yet if the decade right after you stop contributing delivers 2% real instead of 5%, the compounding base never recovers, because there are no fresh contributions to dollar-cost-average through the dip,” Jahanzeb Nawaz, founder and market analyst at FinBrieft told Moneywise. “A Coast FIRE number that pencils out to $1 million at 65 with a 5% real return drops to closer to $700,000, and that savings gap is not recoverable by working a few more years coasting.”