For most of us, early retirement means moving to Boca Raton at 60 instead of 65—and that’s only if you’ve been diligent about growing your nest egg.
But there are people out there who are determined to retire decades before that, and who will do whatever it takes to quit their day jobs before the gray hairs set in.
How, you ask?
By pinching as many pennies as possible now so they can live the good life later.
Curious to see just what it takes to reach such a lofty goal, we asked three couples to share the seriously frugal moves they’re making to get to retirement—fast.
For some, the end game is traveling the world on their extreme retirement savings. For others, it’s leaving the rat race with the help of passive income.
Whatever their definition of success, the one thing they have in common is a willingness to give up some creature comforts in the here and now in order to retire on their own terms.
“We Want to Retire by 40”
Who: Gretchen Lindow, 24, Pinterest marketing consultant and blogger, and Matt Lindow, 25, National Guardsman and heavy equipment operator, St. Louis
Our Early Retirement ‘Aha!’ Moment: “It wasn’t until I found out I was pregnant with our daughter in 2013 that I realized just how terribly we were managing our finances. We barely had enough money for our bills—much less a baby.
So I started binge-reading personal finance blogs and decided that, if we were going to work so hard when we were young, it should be for a big goal—like retiring by 40!
I started Retiredby40Blog as a way to keep myself accountable with my finances.
Our Frugal Moves: Aside from doing a lot of discount shopping, there are other creative ways we’ve discovered to help cut our expenses.
For one, I never pay for oil changes. In fact, I get paid to get them because I’m enrolled in a secret shopper program!
We also have a super-cheap cellphone plan ($23 a month can’t be beat!) because we use a company that lets you make calls over Wi-Fi and cellular service. I estimate this saves us more than $2,000 a year.
I don’t do a whole lot of DIY, but there are a few things I make on my own to save money—like laundry detergent. That saves us more than $100 a year, although I do spend $8 on scent crystals because Matt likes his clothes to ‘smell clean.’
We also decided early on to limit the number of toys we buy for our daughter. It helps save money, and teaches her minimalism. We want her to value experiences and relationships, rather than things, so we leave only three toys out at a time. She’s actually happier with fewer toys—she plays longer and uses her imagination more!
The Impact on Our Nest Egg: Our expenses were $4,500 each month before we set our early retirement goal. But by living frugally, we’ve cut that amount to $2,700—and any leftover money goes toward paying down debt and retirement savings.
Our nest egg is about $125,000, but over the next year or so, we expect to pay off a big chunk of some student and auto loans—which means our savings will skyrocket to between $2,000 and $3,000 per month.
And we won’t need millions to retire.
Frugality gives us a better perspective on life. It may seem like a big sacrifice on a day-to-day basis, but we’re much happier—and healthier—when we’re not stressing over money.”
“We Want to Retire in Our 30s and Live Off Rental Income”
Who: John and Melissa Steele, both 26, real estate sales associates, San Diego
Our Early Retirement ‘Aha!’ Moment: “The lightbulb moment for Melissa and me came when we were both working at a large bank in Buffalo, New York, right after college.
Many of our co-workers were older and had been working there for many years. Seeing how unhappy they were made us realize we didn’t want to be 55 and stuck in a job we hated just because we were close to retirement.
We realized it was important to take control of our lives now—and that included working for ourselves. So two and a half years ago, we moved to San Diego and started our own real estate company, Steele San Diego Homes.
Our goal is to be financially free enough to explore other interests and travel the world—hopefully by our 30s. So it’s retirement in the sense that we’re free of the rat race and able to live off passive income from real estate investments.
Our Frugal Moves: We have no debt, and share the one car we own.
Our largest monthly expense is food at around $2,000. Melissa has some health issues, so we buy healthier food that costs substantially more.
But, as a result, we cook and prepare almost every meal ourselves, and rarely eat out. I bring lunch to work every day. And neither one of us drinks coffee or has any other daily spending habits.
A lot of how we save is by ensuring we’re getting the best value for our dollar. We canceled cable three years ago, opting for Netflix. When choosing an apartment, we factored in amenities like a parking spot, commuting costs and a gym—ultimately choosing the place that would save us the most in cost of living over time.
And when Melissa wanted to buy a Vitamix, she spent six months debating whether the purchase would be worth it. Now it’s an appliance she uses almost every day.
We also do a lot of selling on Craigslist and eBay to make back some money. Anything we no longer use, we put up for sale. And I do mean anything.
When we moved to San Diego, we sold everything: our house, our car, even our sheets. The only thing we threw away was a broom! And we do a purge of our apartment every few months, when Melissa sells or donates anything we no longer need.
The Impact on Our Nest Egg: Our two biggest expenditures are groceries and rent, which run about $3,500 a month. Our cost of living was much cheaper in Buffalo, but even so, we’ve managed to keep our monthly spending the same—between $4,000 and $5,000 a month total—by remaining frugal.
We just paid for our wedding out of pocket, so right now we have only about $20,000 in regular savings and another $10,000 each in our old 401(k)s. But since we’re relying on rental income to get us to retirement, we’re most focused on our net worth, which is currently over $350,000.
That includes rental properties we own in Tennessee, through which we earn more than $1,200 a month without doing a thing. Because we live frugally, we don’t touch that rental income—funneling it back into paying down the mortgages quicker.”
“We Wanted to Retire and Travel the World in Our 30s—and Did It!"
Who: Jeremy Jacobson, 40, and Winnie Tseng, 36, retired, formerly of Seattle
Our Early Retirement ‘Aha!’ Moment: “In 2002, I took my first real vacation, to the Philippines. After three weeks of scuba diving and eating great seafood, my goals were completely transformed—I wanted to do this every day for the rest of my life!
Over the next few years, I sold my house, car and motorcycle so I could ramp up my savings. A few years later, I met my future wife, Winnie, who is also a great saver and travel lover.
We moved in together in late 2005, and by keeping our expenses low, we were able to save over 70% of our income from my job as an electrical engineer and hers as a project manager.
Thanks to our thriftiness, we retired three years ago, and now blog about our travels at GoCurryCracker.
Our Frugal Moves: Most people spend their money on housing, food and transportation, so we knew reductions in these areas would go a long way.
In Seattle, we chose to rent a small apartment in a very walkable neighborhood, which eliminated the need for a car.
Winnie is a great cook, so we always ate and entertained at home. If we asked friends, ‘Do you want to go out for brunch and spend $50 on eggs, or would you rather come over for a home-cooked meal?’ there was really no debate.
We also saved on food by raising vegetables in a small garden plot, and making our own kimchi, kombucha and bread at home for pennies.
Most of our clothes were from thrift stores—before hipsters made it cool—and Winnie made any jewelry we wore by hand.
When I traveled for work, I brought home hotel soap and shampoo, so we almost never had to buy those things. And when we vacationed, we’d use rewards to get free flights and hotel stays.
We never viewed being frugal as a sacrifice—but as a way to spend efficiently while building a nest egg. Saving to travel forever, over buying more stuff, was an easy sell.
The Impact on Our Nest Egg: Before 2002, my expenses were $5,000 per month living on my own. Together, Winnie and I spent less than $2,000 per month during our peak savings years.
By saving so much, we watched our portfolio grow to more than $1 million—which we calculated was enough for us to retire at 38 and 33.
We are currently in Taiwan, where Winnie is originally from. We just had our first baby three months ago. Incidentally, we chose to undergo in vitro fertilization here because the cost would have been five times more in Seattle. Health care abroad is often a fraction of what it is in the U.S.
When our son is 6 months old, we plan to hit the road again.
Over the years, we could have bought most of the symbols of success: a big house, a couple of fancy cars, a nice watch. But for what purpose?
Instead, we travel to beautiful places, rent luxurious housing—and never have to mow a lawn or get the oil changed. This is the life.”