Many people chasing financial independence reach a point where their investments, if left untouched, will grow enough to fund their retirement without any additional contributions. This stage is known as Coast FIRE—a powerful milestone where financial stress begins to ease and lifestyle flexibility becomes possible.
But for many individuals at this stage, another question often arises: Should I keep or sell my home?
That decision can significantly shape one’s journey toward full financial freedom.
Understanding the Coast FIRE Milestone
Coast FIRE occurs when your investments are large enough to compound on their own to your target retirement goal, assuming you simply maintain your current lifestyle and cover living expenses through work. In this case study, the subject is a 46-year-old with a net worth of $1.32 million, split between cash reserves, retirement accounts, and home equity.
Her expenses total around $60,000 annually, while she earns $123,000 per year. With such a strong savings rate and minimal debt, she is already in a position where her investments—if left to grow—could likely sustain her in later years. In short, she’s at or near Coast FIRE.
The remaining challenge? How to optimize her housing situation for long-term financial and lifestyle goals.
The Home Dilemma: Keep or Sell?
Owning a home can be both a blessing and a burden on the path to FIRE. In this scenario, the home is valued at approximately $764,000, with a $241,000 mortgage at a 6.5% interest rate. That’s nearly half a million dollars in home equity—a substantial but illiquid asset.
The dilemma is familiar:
- Keep the home for stability and family continuity, or
- Sell it, unlock the equity, and reinvest it for greater flexibility and passive growth.
Given that only one child remains at home and the homeowner’s desire for a simpler lifestyle, downsizing or even exploring a house hack strategy could be ideal. Selling would free up a large portion of capital that could be invested into a diversified portfolio or a smaller property capable of generating rental income.
Designing a Simplified, Sustainable Financial Plan
Experts analyzing her situation proposed a two-part plan:
1. Reallocate the Portfolio:
Move excess cash into a balanced investment portfolio—often referred to as the “golden ratio” portfolio, consisting of a blend of stocks, bonds, and defensive assets designed to generate 4–5% annual returns with moderate risk.
At a 5% withdrawal rate, this portfolio could yield around $40,000 annually, nearly covering her current expenses—especially if she adds a small income stream from part-time or passion-driven work.
2. Strategic Housing Transition:
Selling the current property in a few years, once her child graduates, could release roughly $500,000 in equity. This could then be used for:
- Purchasing a smaller home or condo outright, eliminating mortgage payments.
- Investing in a part-time rental property (e.g., an Airbnb-style house hack) for supplemental income.
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Adding to her investment portfolio for greater security and passive growth.
Life Beyond FIRE: Redefining Fulfillment
Financial independence isn’t only about retiring early—it’s about aligning time and money with personal values.
For this individual, her vision of post-FIRE life is simple yet deeply meaningful: more time at home, cooking, volunteering, supporting community events, and perhaps doing light, flexible work that fosters connection and purpose.
In essence, she’s not chasing luxury—she’s chasing freedom and simplicity.
The Takeaway
The journey to FIRE is rarely just about numbers. It’s about crafting a life of balance, intentional choices, and value-driven decisions.
For anyone nearing Coast FIRE, this story illustrates how one key decision—like what to do with your home—can redefine your entire financial future.
By simplifying your living situation, investing intelligently, and designing your ideal work-life blend, financial independence stops being a faraway dream and becomes a sustainable, fulfilling reality.
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