Formula
Barista FIRE number = (annual spending − part-time income) ÷ withdrawal ratePart-time income needed today = spending − portfolio × withdrawal rate How it works
Barista FIRE is a middle path between full-time work and full retirement. Your investments cover part of your living costs and a part-time or lower-stress job covers the rest. The name comes from the idea of taking a coffee-shop job partly for its benefits, but any flexible work counts — consulting, seasonal work, teaching, a passion project that earns a little.
Because your portfolio only has to fund the gap, the target is much smaller than a full FIRE number. Earning $24,000 a year part-time removes $600,000 from the portfolio you need at a 4% withdrawal rate. That often brings semi-retirement years forward.
The bar chart shows how your spending is split between portfolio withdrawals and job income for full FIRE, Barista FIRE, and if you quit your current job today. The line chart shows when your portfolio reaches each target.
Health insurance and Barista FIRE
In the US, health insurance is one of the biggest costs for anyone retiring before Medicare at 65. Some part-time jobs offer health coverage, which is why Barista FIRE is popular. If yours will not, include a marketplace plan in your spending; premium subsidies depend on your income, which is often low in semi-retirement.
Is Barista FIRE right for you?
It suits people who want out of a demanding career sooner but are happy to keep working in some form. It is also a safer early retirement: a little earned income in the first years after you leave full-time work protects your portfolio from selling during a market downturn.
Frequently asked questions
How is Barista FIRE different from Coast FIRE?
With Barista FIRE you start withdrawing from your portfolio and work part-time to cover the rest. With Coast FIRE you do not withdraw anything: your job covers all your spending while your investments grow untouched.
How much part-time income do I need?
Your spending minus what your portfolio can safely provide. With $400,000 invested at a 4% withdrawal rate, the portfolio covers $16,000 a year, so $60,000 of spending would need $44,000 of job income. The calculator shows this as "Part-time income needed to quit today".
Does part-time income need to last forever?
Not necessarily. Many people work part-time until their portfolio grows to a full FIRE number or until Social Security starts. Recalculate as your portfolio grows to see how much less you need to earn.
Should I keep saving after I semi-retire?
The calculator assumes you stop adding money once you switch to part-time work. Any surplus you invest is a bonus that moves you towards full FIRE.
Sources
- Bengen, W. P. (1994). "Determining Withdrawal Rates Using Historical Data." Journal of Financial Planning.
- HealthCare.gov — coverage options if you retire before 65