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Compared to Other FIRE Methods
My understanding of Barista FIRE is that it involves a job you can choose to do or not do at your discretion. Many Barista FIRE individuals take on short-term gigs or freelance work. The job is low-stress, with minimal pressure to save aggressively. Instead of chasing high-paying roles, the focus is on simple, relaxed jobs (like being a barista).
When planning finances using the Barista FIRE approach, the journey to retirement is divided into three phases:
- Work Phase: During this phase, you have a stable job with sufficient after-tax income.
- Barista FIRE Phase: You still work, but instead of pursuing high-paying jobs, you opt for simple, low-stress roles. Only a small portion of your income needs to be saved.
- FIRE Phase: Once you meet the FIRE (Financial Independence, Retire Early) criteria according to your plan, you stop working and begin enjoying retirement.
How to calculate Barista FIRE
I created an online Barista FIRE calculator to create an example.
In this example, during the Work Phase, the after-tax annual income is $80,000. In the Barista FIRE Phase, $1,500 per month is allocated to investments. The example shows that when income decreases, the asset growth curve slows down. After 24 years, at around age 59, the assets reach $1 million (the FIRE target, assuming annual expenses of $40,000 and a 4% withdrawal rate).
From this example, the conclusion is that starting at age 36, I would need a full-time job until age 48. Then, I switch to a low-stress job that ensures $1,500 per month for investments, continuing this for 24 years. By age 59, my assets would meet the FIRE requirements, allowing me to stop working.
What Jobs to Do in Barista FIRE
To give you more ideas, my impression is that Barista FIRE is a relatively new FIRE concept, representing a semi-retired state. The capital accumulated without working is sufficient to support a decent quality of life, while engaging in part-time or full-time work you enjoy provides extra income and enriches life. This is a retirement style I’ve recently grown fond of, as fully retiring early without working may not suit everyone.
Here are a few part-time jobs I’m considering for my future retirement:
Ski Patrol
I love skiing and am fairly skilled at it, able to ski all non-cliff trails at a resort in a single season. This is one of the jobs I’m most eager to try. The downside is the low income, and it’s purely trading time for money with no way to scale up. Additionally, the ski season is only about half the year, so I’d need to find other ways to fill the remaining time.
Real Estate Agent
I own several investment properties and have experience running an Airbnb, giving me some background in real estate. The advantage of this job is its flexibility—you can be as busy or relaxed as you want, and it has the potential to scale up if done well. The downside is that it doesn’t fully align with my personal interests. I might start by getting a license and testing the waters to see if it matches my expectations.
Running a Small Coffee Shop or Restaurant
I love making coffee and cooking. When I first started my FIRE journey, my dream was to open a boutique coffee shop in a scenic location. However, my partner thought it wasn’t practical: a beautiful, cost-effective location might lack foot traffic, which a coffee shop needs to generate revenue. A compromise might be running a small shop in a city, where I could design the menu and control the decor and service. The downside is that, especially in the early stages, this isn’t a part-time job. Starting from scratch also comes with risks I’d need to bear.
Pet Shelter Volunteer
I’m an animal lover with three cats at home, so working at a pet shelter to care for animals would be a great option.
Options 1 and 4 have relatively low entry barriers and might not be too demanding, but their upside is limited. Options 2 and 3 feel more like full-time jobs, just in a different field. Recently, I’ve been planning to research options 2 and 3 further to see if I can start laying the groundwork for one of them while still holding a full-time job. This way, even if it doesn’t work out, the impact will be minimal.
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