FIRE Starter Pack: The 4 Types of FIRE Retirement (Lean, Fat, Barista, Coast) Explained

Before I officially retired, I told friends that I was going to start a blog titled “FIRE before 50.” The number one response I got was people asking if I got fired. They questioned if I was hinting that I got (wink wink) laid off. It made me chuckle and also realize that not everyone is familiar with FIRE (spelled in all caps).

So, I thought I’d share the different types of FIRE retirement today because it is, at the very least, interesting. It’s also somewhat cool to learn that you could be part of a community you didn’t even know existed. Because wherever you are in your quest to escape the rat race, you are, in fact, part of the FIRE movement.

FIRE’S FIERY BACKSTORY

FIRE is an acronym for Financial Independence, Retire Early. In its purest sense, FIRE is about aggressively saving, side hustling, and building passive income streams to retire well before retirement age. Many FIRE members strive to retire in their 30s or 40s and sometimes even in their 20s.

I don’t know exactly when the FIRE movement became a thing. I, myself, first heard of FIRE in 2014, about five years into my financial journey. But the movement began much earlier. And like fires of the literal kind, FIRE started small but grew quickly.

Before FIRE became a buzzword, it was just a quiet rebellion wrapped in a paperback. In 1992, Your Money or Your Life boldly asked: “What if you stopped selling your soul for a salary?” Authors Vicki Robin and Joe Dominguez didn’t just challenge readers’ relationship with money—they lit a match.

Readers were introduced to the idea of measuring money in terms of life energy. Instead of focusing on the monetary value of earned income, they were asked to consider the amount of time or “life energy” needed to earn it. Readers were also encouraged to align spending with personal values.

In 2010, Jacob Lund Fisker published Early Retirement Extreme, pushing the envelope further. He promoted extreme frugality, a self-sufficient minimalist lifestyle, and the pursuit of happiness that is free from the shackles of money.

A few years later in the early 2010s, blogs like Mr. Money Mustache and Financial Samurai began to popularize FIRE online.

The two most famous paths are often seen as extremes, sparking the lively Lean FIRE versus Fat FIRE debates across the community.

THE DIFFERENT TYPES OF FIRE RETIREMENT EXPLAINED

Originally, there was only one basic FIRE strategy: live frugally, grow passive income, save 25 times your expenses, and withdraw 4% of your savings per year in retirement. Since then, FIRE has evolved into a few different versions. The goal of reaching financial independence is still the same. The strategies to reach financial independence, however, can vary. And the names of these FIRE offshoots sound like something out of the Power Rangers.

LEAN FIRE: RETIRE EARLY, LIVE LIGHT (THE FRUGAL PATH)

If FIRE is about carefully watching spending, then Lean FIRE takes this to the extreme. It’s all about living lean and keeping annual expenses at the bare minimum. This approach is used to achieve early retirement and maintain it.

Often, you’ll read about members retiring very early and sometimes with modest savings. They’re able to achieve this because of very low annual expenses. The lifestyle outlined in Early Retirement Extreme is an example of Lean FIRE. On Amazon, the author’s introduction mentions he lives in an RV and spends just $7,000 annually.

Lean FIRE followers downsize wherever they can, such as having a one-bedroom apartment and a bicycle versus a three-bedroom home and a car. And they cut down on non-essential expenses like subscription services and paid entertainment.

But that doesn't mean Lean FIRE is about living like a hermit and depriving yourself of enjoyment. Rather, Lean FIRE followers find joy in simple pleasures and experiences. They value spending quality time with friends and family and choose low- or no-cost hobbies like hiking and reading.

Lean FIRE followers don't view money as essential to finding joy in life.

FAT FIRE: LIVE LARGE LATER (THE LUXURY PATH)

Fat FIRE is Lean FIRE’s indulgent brother. Unlike Lean FIRE’s minimalist retirement, Fat FIRE’s about enjoying life’s luxuries after retiring early. Fat FIRE is for those who say, “I worked hard for financial independence, and now I'll enjoy it with champagne and room service.”

A Fat FIRE retirement does, however, come with a price tag. Socking away serious cash may require working a few years longer and possibly a higher income. At the very least, it will take very careful planning and aggressive investing to build a nest egg that can sustain that lifestyle.

Being able to delay gratification for a much more comfortable future is an important trait of Fat FIRE followers.

While Lean FIRE and Fat FIRE get the attention, many people find more practical freedom in the nuance of Barista FIRE and Coast FIRE explained next. These two FIRE paths offer a more balanced approach to the journey.

BARISTA FIRE: SEMI-RETIRED WITH A SIDE OF ESPRESSO

Barista FIRE is the middle child of the FIRE family. It’s less frugal than Lean FIRE, less bougie than Fat FIRE, and totally cool with working part-time to keep the lights on. Barista FIRE followers retire early, but can do so with a smaller nest egg.

The idea? Most of their expenses in retirement are covered by their savings, and the rest is covered with part-time work. They could do gig work, freelance, or sling lattes at Starbucks. Bonus points if the job offers some benefits (hello, Starbucks health plan).

This strategy lets you still retire earlier without needing a seven-figure portfolio. It also gives you something to do in retirement besides alphabetizing your spice rack.Barista FIRE is perfect for people who want freedom, a bit of a safety net, and some structure.

COAST FIRE: CHILL NOW, RETIRE LATER (THE COAST NUMBER)

In the FIRE community, Coast FIRE is somewhat the red-headed stepchild. Many people say Coast FIRE isn’t really a subcategory of FIRE like the previous three. You’ll understand why in a second.

The primary goal of Coast FIRE is to save just enough money early on that compound interest can fully take over to grow that into a nest egg by retirement age. Once that seed money—or the “coast number”—is achieved, Coast FIRE followers take their foot off the pedal and coast to the finish line. It’s like setting investments on cruise control.

Let’s look at an example to better understand.

Say you want to have $500,000 when you retire at 65. We’ll also assume index funds will continue to produce annual returns of 10%. With this information, we can calculate that if, for example, you invest $120,000 into an index fund by the age of 50, the compounding returns alone can get you to $500,000 in 15 years. You wouldn’t need to add any additional capital.

Compounding at 10% a year, $120,000 will turn into $501,270 in 15 years. You can calculate this yourself. Multiply 120,000 by 1.1 for the first year. Continue multiplying the total by 1.1 for each year thereafter.

So $120,000 is your coast number for age 50. Once you reach that number and invest it, theoretically, your investment will carry you to the finish line. You no longer need to save any money, meaning you have extra money to enjoy now before you retire. Or you could switch to a lower-stress job or freelance.

Age 50 was randomly chosen for this example, but the coast number for any age can be calculated. At age 57, you would need $234,000 to reach your goal because there are only eight years until 65. At age 40, that number is just $46,000 because you have a longer runway.

With Coast FIRE, you may still be working, but you're doing so without the pressure to save aggressively once the coast number is met.

Wait a minute! This sounds great, but what happened to retiring early? That’s what the last two letters in FIRE stand for!

If you were thinking this, now you understand why some argue that Coast FIRE isn’t part of the FIRE family. If anything, it's just FI.

Coast FIRE followers don’t necessarily strive for early retirement. Their primary goal is to set themselves up for a comfortable retirement. And yes, you could argue that investing for compounded returns is just common sense.

Still, it illustrates the power of compounding returns. When doing the calculations, you see that with sufficient time, even a small coast number can lead to a comfortable retirement.

DIFFERENT PATHS TO FIRE

If there’s one thing to walk away with, it’s that there are multiple ways to reach FIRE. Often, FIRE is associated with extreme frugality, hustle culture, and delaying life's joys for later. But that’s just one strategy. You now know you have options.

You may be wondering which FIRE strategy my wife and I used. Honestly, I’ve never been able to decide if we belong to any one camp. Some of our behaviors mirrored Lean FIRE. But we also occasionally spent on luxurious experiences on the way to early retirement. Our FIRE plan combined elements from all of the different FIRE strategies. We simply did what worked for us.

And that’s the point. Everyone’s circumstances are different. Everyone’s values are different. FIRE isn’t about steadfast rules. Whether you change FIRE strategies along the way or combine strategies, nobody will revoke your FIRE membership. You can create a plan that works for you.

We’ll go over planning in an upcoming post.

Until then, let me know which FIRE strategy appeals to you in the comments section below.

See you at the finish line!

---

Disclaimer: I’m not a licensed financial professional. This blog shares my personal experiences and opinions around money, investing, and early retirement. It’s for informational and educational purposes only—not financial, legal, or tax advice. Always do your own research or consult with a qualified professional before making any financial decisions.