How to Calculate Your Coast FIRE Number (Step-by-Step)
Coast FIRE gives you a specific, calculable target — not a vague sense that you are “saving enough.” Once you know the formula and your four key inputs, you can calculate your Coast FIRE number in under five minutes. Here is exactly how to do it, with the Canadian adjustments that most guides leave out.
Here is how to calculate your Coast FIRE number: (1) subtract expected CPP, OAS and pension income from your planned annual retirement spending; (2) divide by your safe withdrawal rate (usually 4%) to get your retirement number; (3) divide that by (1 + real return) raised to the number of years until retirement. A 35-year-old retiring at 65 on $60,000 a year, with average CPP and maximum OAS and a 4.3% real return, needs about $286,000 invested today.
| Coast FIRE calculation | Formula / default |
|---|---|
| Step 1 — portfolio must cover | Annual spending − CPP − OAS − pension |
| Step 2 — retirement number | Step 1 ÷ safe withdrawal rate (4%) |
| Step 3 — Coast FIRE number | Step 2 ÷ (1 + real return)years to retirement |
| Real return | Investment return − inflation − fees (e.g. 7% − 2.5% − 0.2% = 4.3%) |
| Average CPP + max OAS at 65 (2026) | $1,629/month = $19,548/year |
| Safe withdrawal rate | 4% standard; 3.5% if retiring before 55 |
| What counts as invested assets | RRSP + TFSA + FHSA + non-registered, combined |
CPP and OAS figures from the Government of Canada: CPP retirement pension amounts (average at 65, April 2026) and the OAS maximum for ages 65–74, July–September 2026. Verified August 2026.
New to the concept? Start with what Coast FIRE is before working through the calculation.
The Coast FIRE formula
Knowing how to calculate your Coast FIRE number comes down to two stages. First you work out how much you will need at retirement; then you discount that back to what you need invested today.
The real return rate is your expected investment return minus inflation (and, to be precise, minus fees). This is what makes the result meaningful: everything is expressed in today’s dollars, so your Coast FIRE number is directly comparable to what you have invested right now.
Step 1: estimate what your portfolio must cover each year
Start with how much you expect to spend per year in retirement, in today’s dollars. Do not inflate it — the formula already accounts for inflation through the real return. A common rule of thumb is 70–80% of current income, but the more accurate method is to list actual expected expenses: housing, food, travel, healthcare, hobbies. For most Canadians, $50,000–$70,000 a year is a realistic range for a comfortable retirement.
Then subtract what the government will pay you. As of 2026 the average CPP retirement pension at 65 is about $877 a month and the maximum OAS for ages 65–74 about $752 — roughly $19,548 a year combined. Your portfolio only needs to cover the difference:
If you plan to retire before 65, add a bridge. OAS cannot start before 65 and CPP cannot start before 60, so the subtraction above only holds from the day your benefits begin. In the years between your retirement date and that day, your portfolio pays your full spending. Add the value of those missing payments to your retirement number: with $60,000 of spending, $19,548 of CPP and OAS from 65 and a 4.5% real return, retiring at 60 adds about $89,700 and retiring at 55 about $161,600, taking the retirement number from $1,011,300 to roughly $1,172,900 — 16% more. Our Coast FIRE Calculator does this for you once you set the age your benefits start.
If you have a workplace defined-benefit pension, subtract that too — it changes the answer dramatically, as our guide to Coast FIRE with a pension shows.
Step 2: calculate your retirement number
Divide the annual portfolio spending by your safe withdrawal rate. The most widely used rate is 4%, based on the Trinity Study (summarised in Investopedia’s four percent rule entry), which found that withdrawing 4% of a balanced portfolio in year one and adjusting for inflation thereafter survived a 30-year retirement in the large majority of historical periods. Our guide to the 4% rule covers where it comes from and its limits.
This is the total portfolio you need on retirement day. Your Coast FIRE number will be much smaller, because compound growth between now and then does the rest of the work.
Step 3: discount back to today for your Coast FIRE number
Work out your real return and discount the retirement number back to the present. Using typical Canadian assumptions — 7% investment return, 2.5% inflation, 0.2% fees — the real return is 4.3%. For a 35-year-old with 30 years until retirement:
So that 35-year-old needs roughly $286,000 invested today to reach Coast FIRE. Hit that and, even with no further contributions, the portfolio grows to $1,011,300 by 65 on its own.
The free Coast FIRE calculator runs all three steps, defaults to Canadian accounts and CPP/OAS, and has a couple mode.
A complete Canadian example
James, 38, Ontario. He plans to retire at 65, expects to spend $65,000 a year in today’s dollars, and uses the current average CPP plus maximum OAS.
| Input | Value |
|---|---|
| Current age / retirement age | 38 / 65 (27 years) |
| Expected annual spending | $65,000 |
| Expected CPP + OAS | $19,548 |
| Portfolio must cover | $45,452 |
| Safe withdrawal rate | 4% |
| Return / inflation / fees | 7% / 2.5% / 0.2% → 4.3% real |
| Step | Calculation | Result |
|---|---|---|
| Retirement number | $45,452 ÷ 0.04 | $1,136,300 |
| Coast FIRE number | $1,136,300 ÷ 1.04327 | $364,600 |
James needs about $364,600 invested today across his RRSP, TFSA and any non-registered accounts. Reach that at 38 and never contribute again, and compound growth carries the portfolio to $1.14 million by 65. Run your own numbers in the Coast FIRE calculator, and see how to read the results once you have them.
Key variables and how to choose them
| Variable | Recommended default | Notes |
|---|---|---|
| Safe withdrawal rate | 4% | Use 3.5% for very early retirement (before 55) |
| Investment return | 6–7% | Long-run average for a diversified equity portfolio; 6% with a large bond allocation |
| Inflation | 2–2.5% | Bank of Canada targets 2%; 2.5% is slightly conservative |
| Fees (MER) | 0.2% | Typical index ETF; 1–2% for actively managed funds |
| CPP + OAS | $1,629/month | Average CPP + maximum OAS at 65 (2026); check My Service Canada Account for your own estimate |
The return assumption deserves the most thought, because a Coast FIRE number is extremely sensitive to it — our guide on what return rate to use in FIRE projections works through the 3/5/7% stress test.
Four errors that throw the calculation off
- Discounting at the nominal return. Using 7% instead of 4.3% in step 3 shrinks the number by almost half and is the most common mistake. The formula must use a real rate — see real vs nominal returns.
- Forgetting fees. Swapping a 0.2% index-ETF MER for a 1.5% mutual-fund MER turns a 4.3% real return into 3.0%, and over 30 years that raises the Coast FIRE number by about 45%.
- Leaving CPP and OAS at zero. Ignoring $19,548 a year of benefits adds $488,700 to the retirement number at a 4% withdrawal rate. Most calculators are American and do not prompt for them.
- Calculating one person’s number for a household. Two sets of registered room and two CPP entitlements need a joint calculation — use the Coast FIRE calculator for couples.
What to do once you know how to calculate your Coast FIRE number
Compare your Coast FIRE number to your current invested assets — RRSP, TFSA, FHSA and non-registered combined.
- Already above it? You have coasted. Retirement contributions are now optional; that income can go to living costs, debt, or a buffer.
- Below it? The calculator tells you how many years of contributions at your current rate close the gap, and what a higher rate does to that date.
- Close? Prioritise the TFSA — tax-free compounding means every dollar inside it grows faster in after-tax terms than the same dollar in a non-registered account.
- Curious about full retirement too? Coast FIRE is the milestone; the FIRE calculator shows your complete financial-independence number. All our tools are in the free financial calculators hub.
Frequently asked questions
Coast FIRE number = [(annual spending − CPP, OAS and pension) ÷ safe withdrawal rate] ÷ (1 + real return) raised to the number of years until retirement. With a 4% withdrawal rate and a 4.3% real return, that is your portfolio spending times 25, divided by 1.043 to the power of the years remaining.
A balanced Canadian portfolio is usually modelled at 4–4.5% real: a 6–7% nominal return minus 2–2.5% inflation minus fees. Never discount at the nominal rate, and test your plan at 3% real as well so you know how much cushion it has.
Yes. Subtract expected CPP and OAS (and any workplace pension) from your annual spending first, then divide by the withdrawal rate. In 2026 average CPP plus maximum OAS at 65 is about $19,548 a year, which removes roughly $488,700 from a retirement number calculated at 4%. One exception: if you retire before your benefits start (OAS at 65, CPP from 60 at the earliest), your portfolio also has to cover the gap years, which adds to the retirement number; retiring at 55 instead of 65 raises it by about 16% in our example.
For $60,000 of annual spending, retiring at 65, with average CPP and maximum OAS and a 4.3% real return, about $286,000 invested today. Change the spending, the retirement age or the return assumption and the figure moves substantially, so run your own inputs.
Not unless you plan to sell it to fund retirement. Count invested assets only: RRSP, TFSA, FHSA and non-registered investments. Home equity is net worth, not retirement income.
The retirement number is what you need on the day you retire. The Coast FIRE number is what you need invested today so that growth alone reaches the retirement number on time. The gap between them is filled entirely by compounding over the years in between.
Last updated: September 2026. CPP and OAS figures verified against Government of Canada published amounts, August 2026.
This article is general information, not financial or investment advice. The examples use hypothetical assumptions; your own Coast FIRE number depends on your circumstances, tax situation and actual investment returns, which are not guaranteed. CPP and OAS amounts change each year and depend on your contribution and residency history. Consider speaking with a qualified financial advisor before making retirement decisions.