Barista FIRE: how a part-time job changes your early retirement
Short answer: Adding a part-time job paying $20,000 a year (about $16,500 after tax) for the first 10 years of retirement took a $1M portfolio spending $40k a year from lasting 40 years in 94% of US start years since 1871 to 100%. Early income matters most because it protects the portfolio in the years when a crash does the most damage.
Barista FIRE means leaving full-time work once your investments cover most of your spending, and earning the rest from part-time work you enjoy: coaching, teaching, fitness instruction, bartending, tutoring. Because that income arrives early, when the sequence of returns matters most, a little goes a long way.
| $1M, all stocks, $40k a year, 40 years | Lasted | Median ending balance |
|---|---|---|
| No job | 94% | $3.6M |
| $20k a year coaching for 10 years | 100% | $5.1M |
How much less you need saved
Part-time pay lowers your number by roughly what that pay is worth today. At a 3% real discount rate, $16,500 a year after tax for 10 years is worth about $141,000, so you could leave full-time work that much sooner. The fun jobs tool uses typical pay for each job, and the Journey shows how many years sooner you could be free.
Questions
What is Barista FIRE?
Leaving full-time work once investments cover most of your spending, and covering the rest, and often health insurance, with part-time work.
How much does a part-time job reduce my FIRE number?
Roughly the present value of its after-tax pay. $16,500 a year for 10 years is worth about $141,000 today at a 3% real rate.