What Is Barista FIRE? Reach Early Retirement A Bit Sooner

By Todd Kunsman

Financial Independence

Published on

Updated on

For many people in the world, the dream of reaching early retirement or working on your terms is incredibly enticing. 

This is referred to as FIRE or “financial independence, retire early” and it has certainly gained steam as new generations of people take interest in finances and disassociating from the “9-5 normalities” of life. 

Yet, not only does retiring early take careful planning and dedication but is often dismissed quickly as many feel it’s simply impossible to achieve.

If you want to truly FIRE, you will typically need 25x your annual expenses saved to safely withdraw 4%. This is to ensure you do not deplete your investments. 

But then you also need to figure out health benefits, which can be another challenge to retiring early. 

Yet over the years, there have been many stories of those who’ve retired early without generational wealth or even a high 6-figure salary. Since the concept of FIRE has taken off, there have been many variations that give you more options to pursue, including Barista FIRE.

What Is Barista FIRE?

The idea of Barista FIRE is when you plan to retire early with enough money invested where the 4% rule still covers part of your early expenses. However, you would then work a part-time job that could offer health insurance or cover additional expenses. 

If you are reading this post, then you might have heard about Barista FIRE and it piqued your interest further. When I first heard about it I had instantly thought of Starbucks, which you might have as well. 

And funny enough, that is exactly where the idea of Barista FIRE started from originally. The reason being that Starbucks is known to offer decent benefits for employees, including part-time baristas. 

This one type of FIRE is so appealing to those looking to retire early because you don’t necessarily have to hit 25x your yearly expenses. It shortens your timeframe to retirement because you can now work a part-time job to supplement certain expenses, while your investments continue to compound. 

How Does Barista FIRE Work?

Barista FIRE encourages you to work part-time or under the gig economy alongside your retirement. The income from this would supplement your passive income streams from investments in order to provide the quality of life you expect in retirement. 

You’ll still be saving and investing during your years of working, but less aggressively than if participating in Lean FIRE, traditional FIRE, or Fat FIRE. No more 40+ hour work weeks! You’ll have flexibility and freedom when it comes to supplementing your retirement with work. 

Those in Barista FIRE can expect to work up to approximately 20 hours per week, either freelancing online or in a part-time job that may offer additional benefits. 

Barista FIRE example

Let’s say you intend to live on $40,000 per year in your retirement. With traditional FIRE, you need to accumulate roughly $1,000,000 to safely retire early and use the 4% rule ($40,000 X 25).  

However with Barista FIRE, you could shorten the amount you have invested. Say you aim for $375,000 invested, this gives you $15,000 per year to live on. Now you can find part-time work that could pay you $25,000 per year to cover the rest and even provide some basic health insurance. 

Now you can also aim to have more invested, which would mean there are more part-time jobs you might be able to take on as it requires less of a salary to make up the difference. 

Is Barista FIRE really early retirement? 

You could argue that pursuing Barista FIRE doesn’t really mean you have “retired early,” considering you technically are still working. But this type of FIRE allows you to escape the traditional 9-5 job (especially if you hate your company or career), work fewer hours, and still have time to pursue or do the things you love. 

Why Barista Fire Might Be The Right Move

Before you jump headfirst into Barista FIRE, there are some things to consider. It won’t offer complete retirement, in that you will be spending a proportion of your time at work still. 

Now, this may be a relief as many of us dread the lack of routine we’re likely to find in retirement. But there are some pros and cons when comparing Barista FIRE to the traditional FIRE strategy. 

Barista FIRE pros 

  1. The main barrier to early retirement is the lack of an affordable healthcare plan. Barista FIRE allows you to continue working, and continue subscribing to an employer-sponsored healthcare plan (pending the company). Alternatively, your spouse may be continuing to work and is able to add you to their healthcare plan. This saves a good proportion of money you would be spending if not working at all, and makes early retirement more realistic. It could even speed up your retirement.  
  1. Barista FIRE is a smart way to dip your toe into retirement waters. Early retirement is not for everyone — it brings a lack of routine and can leave you feeling without a purpose in life. Especially if you don’t have the funds to properly enjoy yourself. Barista FIRE is a stepping stone into retirement, which means that you can begin to experience a more relaxed lifestyle without losing the routine and purpose.This can be useful for your mental health. 
  1. You have a safety net in case your investments are not returning as much as expected. 2020 was a prime example of how unstable the stock market can be (although it recovered fairly quickly), with market corrections and recessions all in play. Having the means to supplement this income puts less pressure on you and your portfolio. 
  1. The concept of Barista FIRE does not lock you into a barista-style job, working hourly rates. In truth, you could be working online (which supports a location-independent lifestyle), or working on a number of paid projects at once. There is ample freedom in the work you choose, which can add fulfillment to your lifestyle. Not only that but at present 36% of Americans are working in the gig economy, with this only predicted to grow in the coming years. 

Cons of Barista FIRE 

  1. Barista FIRE does not offer complete financial freedom, as you will be relying on hours worked to supplement your income. If you could no longer work, due to health problems or other reasons; it would have an impact on your financial independence and retirement plans. 
  1. Barista FIRE slows down your financial independence. While it allows you to continue to work towards traditional FIRE, it will be a slower route than aggressively adding to your investments at every opportunity possible. 
  1. You don’t know what the job market will look like when you intend to begin your part-time gig, which adds pressure. Due to the recent 2020 pandemic, for example, approximately 12.6 million Americans are/were unemployed, which makes the job market insanely competitive. And who’s to say that might not happen again or some other event that impacts the economy in the future? 
  1. Pursuing this form of FIRE still requires you to stick out your full-time work and be aggressive with investing and being frugal, especially if you have an average or below average salary. You’ll still have to stick out 15, 20, or 25 years of working. But if you do start early, you maye find Barista FIRE achievable in your late 30s or in your 40s. And that’s still earlier than the average retirement age of 65. 

Calculate Your Barista FIRE Number

To work out your Barista FIRE number: 

  1. You’ll first need to decide your annual cost of living. Do this by calculating monthly expenses, then multiplying by 12. 
  2. Estimate the annual income you’ll receive from the part-time job. 
  3. Subtract this part-time salary from your annual expenses. 
  4. Your Barista FIRE number is 25x (supplemental income)

Let’s assume you require $40,000 in expenses every year which is the equivalent to 4% withdrawals of your FIRE number. 

The lower your current investments are, the more you’ll need to make in supplemental income whether in hours worked or higher hourly rates.

Annual ExpensesTotal BaristaFIRE numberAnnual WithdrawalsAnnual Top Up Required (Barista Income)

Best Barista FIRE Jobs to Consider

As mentioned, Barista FIRE does not limit your part-time job search and can even see you pursuing passions during retirement.

Here are a few good ideas for part-time jobs or side hustles while living out your somewhat early retirement dreams: 

  • Teach online. You can get a TEFL certificate through an online course and teach English as a foreign language to students all around the world. It also makes your hourly rates more flexible, as you can choose students in different time zones. 
  • Consult or coach based on your previous work experiences. If you’re looking at early retirement, chances are you are at least in a mid-level career position in your chosen field. This expertise can be focused on creating income during retirement with part-time consultancy roles. It might even allow you to stay on at the same company if you enjoy it.
  • You could literally be a barista. Maybe you love coffee, or maybe there’s a cafe local to you which would be easy to work from. Why not hone in on your coffee-making skills and simply work part-time, serving and interacting with people from all walks of life. 
  • Work at a top-tier grocery store. Pending where you live, a place like Wegmans or Whole Foods could be a great place to work. They offer decent pay (higher than many grocery stores) and have various benefits for employees (including part-time). 
  • Seasonal jobs. As you know, certain holidays or times of the year can create demand for seasonal workers. If your part-time income is on the lower end, these seasonal jobs might be good to apply to.
  • Get started doing odd jobs and tasks on Upwork or Fiverr. For the digitally savvy, these gig economy sites offer online admin roles, along with jobs in graphic design, social media, and more complicated website tasks. You won’t get health insurance coverage this way, but it could cover those expenses or if you have a spouse still working where you can get coverage, then the gig economy could be an option. 
Tools to help you on your Barista FIRE journey:
  • Personal Capital to monitor net worth, investments, spending, and more for free.
  • Blooom to monitor your 401k or IRAs. Get recommendations, catch hidden fees, and more for free.
  • YNAB or Savology. These budgeting tools can help you keep your spending in-line, especially since with Barista FIRE you want to be more frugal.

Alternatives to Barista FIRE

As you saw me mention throughout the article, there are other types of financial independence to pursue. Barista FIRE can be a great option for you, but there are others. Interested in learning more? Below are the other common types of FIRE: 

Traditional FIRE

If you’re looking for a more aggressive savings and investment plan which means you aren’t required to supplement your income, traditional FIRE may be a better option. 


Perhaps you live frugally and won’t require as much income during retirement as the average American. In this case, Lean FIRE would be more well-suited.


On the opposite end of the spectrum, those who’d like to retire with a heavier lump sum would want to choose Fat FIRE. 

Coast FIRE

Finally, Coast FIRE is better suited to younger individuals who are searching for an aggressive investment plan now, to relax later in their career.