How much you need saved today to stop saving — and how a reverse mortgage at 62 lowers it
Not counting a mortgage payment. Step 2 adds your mortgage.
Stocks have returned about 6–7% a year after inflation over the long run. The 4% rule: spend 4% of your portfolio in year one, then raise it with inflation.
Coast FIRE Summary
Coast FIRE number
$470,044
needed invested today
Invested today
$300,000
$170,044 to go
Retirement number
$1.38M
at 62, to spend $55,000/yr
Time to coast
9 yrs
saving $2,000/mo
Where you are
You have
You need
to coast
Estimates only. Returns are illustrative, not a forecast. A HECM requires age 62, HUD counseling, and the loan balance grows over time. Today’s rates →
Altgage Inc. NMLS #2447252 | 100 Cambridge St, Floor 14, Boston, MA 02114|Coast FIRE is the point where you can stop adding to your investments and let them grow into a full retirement on their own. You keep working to cover today’s bills; you just don’t need to save anymore. The calculator above builds it in three steps, and the last two add a tool most Coast FIRE calculators leave out: a reverse mortgage that opens at 62.
Divide yearly retirement spending by your withdrawal rate — at 4%, that’s 25 times spending. That’s what you need at retirement. Then work backwards: how much, invested today and left alone, grows into it by your retirement age? At a 5% real return over 22 years, it’s about a third.
If you’ll still owe on your home when you retire, your portfolio has to cover those payments too. A HECM at 62 pays the mortgage off from your home equity instead, so that money stays invested. The reverse mortgage calculator shows what your home could support.
A crash in the first years of retirement does the most damage, because you sell shares at the bottom to pay the bills. Whatever the HECM line has left becomes a second pot to spend from in down years, which is what research by Wade Pfau and the Sacks brothers found extends a portfolio. The sequence of returns risk calculator runs this year by year.
A HECM is a loan. Paying off the mortgage, the upfront costs, and anything you draw are all borrowed, and the balance grows every year until it’s repaid from the house. That’s less home equity for your heirs. Step 3 counts what you owe before saying you’re better off.
Retiring well before 62. A HECM can’t open until 62, so the years before that — including any early crash — are on your portfolio alone.
Leaving the house to your heirs. Every dollar the HECM pays or lends comes out of the equity they’d inherit.
Moving. A HECM is repaid when you sell or move out for more than a year. The strategy assumes you stay put.
Health care before 65. Retiring before Medicare can add $10,000–20,000 a year per person. Include it in your spending.
Coast FIRE is the point where your invested assets are large enough that, if left to compound and never added to, they will hit your retirement number by a traditional retirement age. You still have to cover current living expenses somehow, but you no longer have to save. It is a softer milestone than full FIRE and much easier to reach because it does the math backwards: instead of asking how much you need to retire today, it asks how much you need today to retire in twenty or thirty years.
FIRE means you have enough saved to stop working entirely; Coast FIRE means you have enough saved that you can stop saving and let compounding do the rest. Full FIRE is a much bigger number — usually 25× annual expenses in liquid assets. Coast FIRE is that same number discounted back to today at whatever real return you assume, so a 40-year-old aiming to retire at 65 needs roughly a third to a half of the FIRE number, depending on the return assumption.
A reverse mortgage lowers what you need in two ways: at 62 it pays off any mortgage you still have, so your portfolio doesn’t have to cover those payments, and whatever line of credit is left becomes a second pot to spend from in down markets instead of selling stocks low. Research from Wade Pfau and the Sacks brothers found that drawing on the line in down years extends how long a portfolio lasts. Steps 2 and 3 of the calculator above show each effect separately.
Historically 4% survived every 30-year window in the US even including the worst starts (1929, 1966, 2000), but at today’s valuations several researchers argue a starting withdrawal of 3.3% is the safer floor for a portfolio you cannot supplement. Bill Bengen, who wrote the original 1994 paper, has since moved to about 4.7% for retirees who use flexible spending guardrails. This calculator lets you set the withdrawal rate yourself so you can see what each choice costs.
The HECM is debt against your home, and the line of credit grows because you owe more, not because you have more. If you plan to leave the house to your heirs, drawing on it reduces what they inherit. The strategy also assumes you will stay in the home long-term — moving out for more than twelve consecutive months triggers repayment. And you must be 62 to open the line, so anyone retiring earlier still needs a portfolio big enough to fund the bridge years alone.
Then the reverse mortgage has a real cost: everything it pays or lends, plus interest, is repaid from the house and reduces what your heirs inherit. Heirs can still keep the home by paying off the balance, and a HECM is non-recourse, so they never owe more than the home is worth. If leaving the house debt-free matters most, use step 1 alone and treat the HECM as a backup rather than part of the plan.
A real return is the return after inflation, and the historical US stock-market average is roughly 6.5–7% real over long periods. Most FIRE calculators default to 5–7%; a 4% default is common for people who want a conservative floor given current valuations. This calculator lets you slide it between 3% and 7% because the answer is highly sensitive — dropping from 6% to 4% roughly doubles the Coast FIRE number for a thirty-something aiming at age 65.
Yes — the reverse mortgage buffer is optional and the calculator shows the number both with and without it. Skipping the HECM produces a larger Coast FIRE number because you have to fund the full retirement withdrawal from the portfolio alone. Whether that difference is worth activating a HECM depends on your view of debt, your heirs, and how confident you are in traditional 4%-rule assumptions.