FireLotse

Barista FIRE

Retirement

Barista FIRE is a transition strategy: after your FIRE date you keep working part-time (e.g. as a barista, freelancer or in a mini-job) to cover part of your running costs. The rest is withdrawn from the portfolio.

The advantage: your FIRE capital does not have to carry all of your living costs – this lowers the required FIRE number considerably and shortens the accumulation phase. With a part-time job subject to social-security contributions (a "Midijob", from approx. €603/month) you are health-insured via your employer – investment income then stays free of health-insurance contributions. With a mini-job that is not the case: there you need your own (voluntary) statutory health insurance, which assesses all income including investment income.

The downside: you are not completely free from paid work. Barista FIRE is a compromise between financial security and freedom.

Example:€3,000 / month expenses. Barista net income: €800 / month → gap: €2,200 / month from the portfolio. That saves a considerable amount of FIRE capital compared with full withdrawal.
Barista FIRE in FireLotse:In the retirement planner you enable Barista FIRE via a checkbox and enter your expected monthly net income. FireLotse calculates the net gap and the required gross withdrawal (incl. taxes and health insurance) automatically by calculating backwards.
Try it in the FireLotse calculator

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