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Retire By 40: 7 Habits To Help You Reach Financial Independence Early

Ankur Talukdar February 05, 2020

Frugal For Less
Frugal For Less -

Do you dream of learning how to retire by 40?

My in-laws did it!

After my father in-law spent 20 years in the military, he retired and did not go into the job force.

And, his wife remained job-free as well.

They settled down in an affordable city near a military base and have been living there for over 20 years.

How did they do it?

Is early retirement in your 40s actually a thing?

It is a goal that more and more people are starting to have and it’s within reach!

Bookmark this post and keep reading to learn these 8+ habits of people who retire in their 40s.

Why Do People Want to Retire Early?

Early retirement is a dream for many people.

It’s appealing because who wouldn’t be interested in stopping work early, in lieu of a life of leisure, pursuing the things you’ve always wanted to do:

  • Travel
  • Relax
  • Pursue passions and hobbies

Advantages of Early Retirement

  • More time (for family, travel, etc.)
  • An opportunity to start a new career
  • Possible health benefits (like enjoying more sleep, etc.)
  • Less stress
  • Finding new interests

There can even be unexpected benefits to early retirement.

Disadvantages of Early Retirement

  • Being forced into a frugal lifestyle
  • Boredom
  • Missing work
  • Lesser social security benefits
  • More time required to make retirement savings last

Is a life of long lunches and anytime travel really worth it?

It can be for a lot of people.

How Much Should I Have Saved for Retirement By Age 40?

How much should you save for early retirement?

What’s the magic number?

This number varies from person to person.

Imagine your retirement life and from there, you can start to envision how much retirement savings you’ll need to retire by age 40.

How much do you earn now?

Are you living a comfortable life?

Could you live comfortably on a lesser income?

Answer these questions and figure out the least amount of annual salary needed to live well and multiply that by the number of years you expect to live.

$40,000 x 35 years = $1.4 Million

To be conservative, you might consider adding a buffer, for unexpected expenses that may occur plus the rising cost of living as time moves forward.

There’s also the 80 percent rule and other school’s of thought to figure out how much you need to retire.

Curious on what the median retirement savings by age should be? Check this out.

How Much Does A Single Person Need to Retire?

If you’re single, calculating your retirement savings will be based on your salary alone.

How Much Does a Couple Need Saved to Retire at 40?

Consider the salary of you and your partner when figuring out your target savings figure.

7+ Habits of People Who Retire in Their 40s

Now, onto the list of 8+ early retirement habits for people who want to retire in their 40s.

1. Early Retirees Embrace Side Hustles and Extra Income Work

Extra income is a great way to help you reach early retirement faster.

And, early retirees are open to taking on more work.

More work equals more income.

It takes money to save money.

Combining making money with saving is a strategy that many early retirees do in order to enjoy a life of retirement in their 40’s.

Here are some examples of extra income opportunities that you can pursue to up your income game:

  • Driver Jobs
  • Side Hustles
  • Small Business
  • Extra Income Opportunities

Driver Jobs to Work from Your Car

Driver jobs where you can work from your car are great because you can work in a casual environment, when you want, with on-demand work and weekly pay.

There are many more perks too.

Here are some driver jobs you can take on to make extra money:

Uber and Lyft are about delivering people.

You’ll be the driver, picking up and dropping off passengers in your vehicle.

You can read reviews on being an Uber driver and Lyft driver to learn more about the two jobs.

Your main job will be driving, which can relieve stress and make the time go by so it doesn’t actually feel like you’re working.

Some other perks shared above and more, include:
  • Weekly pay
  • On-demand work
  • Choose your own schedule
  • Casual dress
  • Work from your car
  • And, more!

The UberEATS, Doordash, GrubHub, and Postmates driver jobs are about delivering stuff, like food and groceries.

This involves you picking up the goods and delivering to the customer’s doorstep.

Which type of driving jobs piques your interest?

Either way, driver jobs may be a great fit for you!

Side Hustles for Extra Money

This list of side hustles will have a little of everything for everyone, whether you’re introverted or an extrovert, enjoy working in the outdoors or prefer desk work.

These side hustles are extra income opportunities that you can work alongside your primary job and some of them can be taken full-time with ease.

Take a look!

  • Flea market flipping
  • Website flipping
  • Social media management
  • Digital marketing
  • Digital publishing
  • Babysitting
  • Petsitting
  • Pet walking
  • Affiliate marketing
  • Blogging
  • Amazon FBA
  • Virtual assistance
  • Life coaching
  • Resume writing
  • Sales page writing
  • Ghostwriting
  • Copywriting
  • Graphic design
  • Voiceover services
  • Translation
  • Transcription
  • Day trading
  • Social media influencer
  • Content creator
  • Ebook author
  • Digital course creator
  • House cleaner
  • Event planner

Flea market flipping

Flea market flipping is a form of arbitrage.

The whole idea is to take advantage of price differences in the market to make a profit.

You will find gems at flea markets that are underpriced and high value, then flip them on Ebay, Amazon, local consignment shops and other places, for a profit.

For example, you could buy a vintage lamp for under $10 and resell online for a big profit.

Flea markets are full of hidden treasures that are perfect for reselling.

Website flipping

Website flipping is another type of arbitrage where the focus is buying and selling website inventory.

For example, you can buy a tech blog for $200, spend a few months improving it, and then resell it for $1,000, profiting $800.

There are website flippers that do flipping full-time!

It can be a lot of fun, very rewarding and lucrative.

Check out 7 of the best marketplaces for website flipping.

Social media management

Managing social media is all about creating content that will resonate with the brand’s audience.

You’ll have a knack for connecting with people, you enjoy engaging with others and creating content for the internet.

It’s a job that can be a lot of fun, especially if you love playing on social media.

Some of your tasks might include:
  • Posting on various networks like Pinterest, Facebook, Instagram, etc.
  • Engaging with the Facebook fan page audience
  • Creating social media graphics
  • Social media ad management
  • Reviewing analytics to uncover trends, and more!

Digital marketing

Digital marketing includes all online marketing, like:

  • Email marketing
  • Content marketing
  • Social media marketing, and more!

Online marketing is super important because it helps consumers be introduced to new brands.

Your job as a digital marketer will be to reach people through the internet and turn those people into customers for your clients.

Recommended reading: 10 Digital Marketing Jobs That Pay Well

Digital publishing

Digital publishing is about publishing content online, through websites, blogs, content sites, etc.

Your job will be to create content for online publishing.

You can find digital publishing jobs here:

Babysitting

Babysitting is about watching kids for others.

This could include cooking meals and preparing snacks, playing with kids, supervising them for safety, etc.

This could also lead to being a nanny.

Find babysitting jobs through your local community like neighbors, friends, and websites like Care or Sitter City.

Petsitting/Pet Walking

As a pet sitter you will be watching pets.

It’s like babysitting but for pets.

This could include taking dogs for walks, changing food and water, emptying cat litter or bird cages, and related activities.

This is a great side gig for pet lovers and an important job, as pet owners who are busy with work or travel may need their pet cared for while they’re away.

My mother-in-law and father-in-law have three dogs and they take them with them everywhere.

So when they travel to visit us, the dogs are coming.

My husband hates this but they really have no other choice.

They can’t leave them behind.

The dogs need to be let out to urinate, they need food and water changed, etc.

A pet sitter is the perfect solution here and many other pet owners are in the same boat.

If you’ve got entrepreneurial spirit, start your own petsitting company and start with your own community to get your first customers.

For dog walking try companies like Wag and Rover.

Affiliate marketing

Affiliate marketers make money referring products.

They refer products to customers and when a purchase results, you earn a commission.

For example, if you write about vegan food on your vegan food blog and you refer your favorite brand of vegan pasta sauce to your viewers, this is affiliate marketing.

As an affiliate marketer for the vegan pasta sauce company paying $5 for each sale referred, if your blog post results in 20 sales this month, that means you made $100 ($5 commission x 20 sales)!

Or, if you share your favorite cashback website (as an affiliate) to your social media followers and you get some of your followers to signup, if your referral results in a sale, you earn a commission.

This is exactly how affiliate marketing works.

You can refer in various ways on platforms like through email, social media, your blog and other places.

Read more about affiliate marketing with these 10 quick tips for beginners.

Blogging

As a blogger you’ll write content on your blog and you can earn money in a variety of ways, including:

  • Sponsorships
  • Advertisements
  • Affiliate marketing
  • Your own products and services

Sponsorship income is when you partner with a company to share them on your blog.

This can include:

  • Writing an article about them
  • Hosting a giveaway for them
  • Posting about them on your social media accounts
  • Writing about them in an email newsletter to your email list

Ads are next and you can get paid through ads when you join an ad network.

After ads from the ad network are placed on your site, you will make money every time a user will click on the ad.

Next is affiliate marketing income which was shared a bit, above.

For a blogger you can share products that you love or products that support your business or revolve around the niche you blog about and when readers click and purchase from your referral, you will earn an affiliate commission.

Lastly, you can make money with your own products and services.

This includes digital and physical products like ebooks, courses, printables, coffee mugs, merchandise like sweatshirts, and more.

Learn how to start a blog in our free 7-step guide.

Amazon FBA selling

Amazon FBA stands for Amazon Fulfillment by Amazon.

It’s a program on Amazon where sellers can partner with Amazon to ship their goods to customers.

So instead of getting an order on your Amazon store then you packaging and shipping the item to the customer, Amazon will ship for you.

You will send all your products to their warehouse in advance and then once an order comes in, they’re in charge of shipping to the customer.

This is pretty desirable for a lot of Amazon sellers because it makes a lot of the process hands off.

You can focus on other parts of your business and let Amazon take care of the fulfillment.

Read more about Amazon FBA to see if it might be a good fit for you.

Virtual assistance

As a virtual assistant, or VA, you’ll be supporting busy business owners and companies by helping them with virtual tasks.

Here are some examples:
  • Email management
  • Party planning
  • Appointment setting
  • Calendar management
  • Note taking during meetings
  • Social media scheduling
  • Copywriting
  • And, other duties, depending on your client

Virtual assistants can make money hourly or on a project basis.

Hourly rates can start at $15/hour and project rates can start at $200/month and increase from there, depending on the scope of the project.

Find VA jobs in places like Indeed or Upwork.

Life coaching

Life coaches help people be the best version of themselves.

This is a growing field and becoming a life coach means you will help others:

  • Get more organized
  • Leading a more productive life
  • Practicing mindfulness
  • Manage stress
  • Cope with change
  • And, more!

Read more about how to become a life coach here.

Resume writing

Resume writers create resumes and/or help others create a winning resume.

Score resume writing jobs in places like this:

Sales page writing

Sales page writers create professional, beautiful sales pages for businesses.

This can be to announce a sale, a promotion, upcoming launch, physical or digital product.

This is one of the more lucrative copywriting jobs, fetching up to four figures per sales page.

If you have excellent copywriting skills for the purpose of selling, this would be perfect for you.

Find sales page writer jobs on Indeed and Upwork.

Ghostwriting

Ghostwriting involves copywriting content for others where you do not take credit.

Examples:

  • Ebooks
  • Sales pages
  • Books
  • Resumes
  • White papers
  • Blog posts
  • Magazine articles

You can find ghostwriting jobs on freelance job banks and classified listing websites.

Copywriting

Copywriting is all about writing with some clients including magazines, blogs, professionals, websites, brands, companies, and more.

Join copywriting communities, network with other writers and look on social media for opportunities.

Graphic design

Graphic designers will be designing stuff for professionals and companies.

Examples:

  • Social media graphics
  • Book covers
  • Business cards
  • Sales pages

This is a natural fit for creatives with design ability.

Voiceover services

Voiceover involves using your voice to narrate.

This could be for storytelling, broadcasting, creating YouTube videos, video walkthroughs and tutorials, etc.

Translation

If you know more than one language you can make money on the side translating for others.

Places Where To Find Translation Work:

Check out these additional translation jobs where you can work from home.

Transcription

Working as a transcriptionist means you’ll be listening to audio and typing what you hear.

That’s it!

It’s simple enough but requires someone who is organized and detail-oriented, as you will likely be required to follow a style guide when transcribing audio you hear.

Transcriptionists can make up to $25/hour and your clients can vary from podcasters, YouTubers, social media influencers, attorneys, and more.

Perks include working a flexible schedule with ability to work from home, and more benefits.

Places to Find Transcription Jobs

Day trading

Day trading is buying and selling financial instruments during the same day.

The goal of doing this is to make a profit.

How much can day traders make?

I saw a case study where a trader investing around $10,000 made about $500 in a week.

Read more on how much you can possibly make day trading here.

Can anybody do day trading?

Sure, but it does require skill.

If you’re curious about trying day trading but not sure you can do it alone, try taking an online course or watch tutorials on YouTube to learn how to day trade for beginners.

Learn more about what day trading is and if it’s right for you.

Social media influencer

Become a social media influencer and make money that you can contribute to your savings to help you move forward toward early retirement.

Influencers make more than many people think.

Many make a full-time income!

How can you make money as an influencer?
  • Partner with brands
  • Ads
  • Affiliate marketing
  • Your own products and services

Networks like Facebook, Instagram and YouTube are good platforms to help you make money, though you can monetize just about any social platform.

Sponsored Networks to Join
Ad Networks to Join

Affiliate Networks to Join

Tools to Create Your Own Products/Services

Content creator

Content creation is all about creating written, audio, and video content for an audience.

This can be a blogger writing blog posts for their readers, or a YouTube influencer making videos for their viewers, etc.

How can you make money as a content creator?

Like influencers and bloggers, content creators can earn through ads, sponsorships, affiliate marketing and your own products and services.

Take a look at what the highest paid YouTuber’s earned in 2019.

Ebook author

There is a lot of money to be made becoming an author of ebooks.

As an ebook author you will be writing an ebook and selling to your audience directly, through a marketplaces like Amazon, or through your methods.

Amazon paid $450,000 To This Ebook Author.

Digital course creator

A digital course creator is serving a message to consumers through course creation.

It’s like you’re a college professor but, in an online capacity and you don’t have to give oral lectures.

You start by creating a course around a particular pain point your audience has, like stay at home moms trying to monetize their hobby.

Then, you validate your idea, and once validated, start creating your course curriculum.

After you launch you can start earning money and do little to no maintenance to continue earning passively.

Here are some platforms you can sell your course on:
Here are some examples of successful course creators:
  • Mariah Coz is known for her $400,000 course launches
  • Melyssa Griffin is also in the $400K course launch club
  • Michelle from Making Sense of Cents has earned $50,000+/month from her affiliate course sales
  • Videofruit made over $220,000 in 10 days from their course launch

How to Create an Online Course?

1. Come up with a course idea

2. Validate the idea

3. Create your launch plan

4. Launch

Coming Up with Your Course Idea

Coming up with your course idea can require some work.

You want to solve a problem by presenting a solution, in your course.

Examples:
  • Helping people move cross country stress-free
  • Showing bloggers how to monetize their blogs with sponsorships
  • Teaching college kids how to cook at home
  • Teaching computer programming to aspiring programmers

Validating Your Idea

Next is idea validation.

Validation will test your course idea on a small audience to gauge interest.

Based on that test, you’ll know if you should move forward or not with creating your course.

How to actually validate your idea?

  • Run a beta test
  • Presell
  • Take a poll

Read about the 6 steps to a successful presale.

Creating Your Launch Plan

Then, once you’ve validated your idea for the course, you can launch.

Your launch plan may include things like:

  • Emailing your list
  • Creating one or more webinars
  • Announcing on social media

You can choose to have an evergreen course or open it for a limited time.

Launch

For the launch, here are some best practices to keep in mind for a smooth course launch:

  • Be available for students and prospective students
  • Be responsive

The main takeaway is that you want to be present during the launch and be checking on course purchases, access, etc. throughout the process.

I’ve heard of horror stories where the shopping cart broke over the weekend and the course instructor couldn’t correct the issue until Monday because they were away, losing out on thousands in potential sales.

Don’t let this happen to you!

House cleaner

House cleaners clean houses.

They also clean buildings, commercial spaces like offices, etc.

This can be a cool side hustle that keeps you busy and active.

The time will go by quickly and if you love an organized, clean space, this might be right for you!

You can do this on your own, forming a one-person cleaning company or recruit a team who can help.

What’s Required?
  • Cleaning supplies
  • Transportation
  • Staff (possibly)

House cleaners can earn up to $50/hour or more.

You’d need less than half a dozen clients to make over $1,000/month!

Where to Find Clients?
  • Facebook Marketplace
  • Groupon
  • Living Social
  • Angie’s List
  • Create a Website for Your Services and Advertise
  • Tell family and friends
  • Advertise locally

Event planner

Event planning is fun for people that love to organize and plan events.

You’ll actually get paid to plan parties!

Examples:
  • Birthday parties
  • Anniversaries
  • Weddings
  • Corporate events
  • Office functions or meetings

It’s not unusual to fetch $1,000 to $2,000 per event which means you’d only need to book one per month to create a four figure monthly side hustle for yourself!

My best friend started doing this on the side a few months ago and has already booked 3 events!

She loves it and is having so much fun running her company.

Need more ideas?

More resources:

Small Business Ideas You’ll Like

Starting a side business is a great way to supplement your income and help you grow your savings twice as fast as working your day job alone.

Build a company and stash away money for early retirement.

It’s a win-win.

Start by thinking about your skills and passions.

This is often where most business owners begin.

You can go the path of doing your day job work as a freelancer, working for yourself.

You can also monetize your hobby or start a passion project.

Whatever path you take, keep in mind these best practices to help you launch and run your business smoothly:
  • Form your business (sole proprietor, LLC, etc.)
  • Open a separate bank account for your business
  • Create a business plan
  • Solve a problem on the market
  • Keep it simple
  • Measure your success and keep growing
  • Don’t be too tough on yourself

Take a look at these 10 tips for starting a small business you haven’t heard of.

Next up, you can start a small business as a way to make extra money to stash away in your early retirement fund.

Small businesses you can start:

  • Ecommerce store
  • Content writer
  • Tutor
  • Stylist
  • Interior design
  • Party planner
  • Caterer
  • Network marketing
  • Public relations
  • Digital marketer

Recommended reading: 20 Home-Based Business Ideas That You Can Start From Home.

Extra Income Opportunities

Aside from starting a business, take a look at these ways to raise more money that you might have overlooked:

  • Overtime at work
  • Taking on a second job
  • Taking on a second job at your employer (for example, if you’re a history teacher, become the girls’ volleyball coach too)

You can also look at pursuing unusual and extreme ways to make money.

Some examples:

  • Survey Taking
  • Selling stuff around the house
  • Dropservicing
  • Participating in online studies
  • Teaching English online
  • Renting out your garage
  • Get paid to test video games
  • Renting out your equipment
  • Selling your crafts on Etsy

Survey Taking

Survey taking is such an easy way to make money.

More people should be pursuing it.

Regardless of the survey company you’re working with, the process is pretty much the same:

Step 1: Join the survey company for free
Step 2: Take surveys
Step 3: Get paid

You sign up for the survey company online.

Upon signup there is a registration process where you may answer questions about your background and demographics.

The purpose of this questionnaire is to ensure you’re matched with the right surveys.

Then, you’ll take surveys.

Depending on the company, you’ll have two options:
  • On-demand surveys, 24/7
  • Survey matching

With on-demand surveys, you can take surveys whenever you want, 24/7.

That means when you’re laying in bed in the morning, preparing for the day, you can hop on your smartphone and take a survey.

When waiting in the lobby of your dentist appointment, you can take a survey.

These surveys are pretty much unlimited and you can take them at 8am or 2am and anytime in between 24/7.

The next type of survey company matches you with specific offers.

In this case, instead of logging into the survey website or app and taking surveys when you want, you’ll be emailed when a survey match is available for you and then, you can take that survey.

You will not get rich doing surveys but, you can make some extra money on the side, which you can throw right into savings, to help you achieve your early retirement goal that much faster.

Advantages of Surveys
  • Take surveys when you want
  • Available 24/7
  • Pay via PayPal, direct deposit, check, gift cards, and rewards
  • Get paid to share your personal opinion
  • Feel fulfilled by shaping the way that companies create their products for consumers
Disadvantages of Surveys
  • Low-paying
Here are some top survey companies you can start with:

Take a look at these 10 top survey sites that will make you $300/month or more.

Selling Stuff Around the House

Going around your house can uncover some hidden treasures that you could sell for some nice cash.

This is great to do during Spring cleaning and Winter cleaning, or anytime you’d like.

Go room by room and start accumulating things you can sell:

  • Small appliances
  • Toys
  • Clothes and shoes
  • Home decor items
  • Linens
  • And, more!
Places Where You Can Sell Your Stuff?

Dropservicing

If you’ve heard of dropshipping, then dropservicing can be considered a close cousin.

Dropshipping means that when you sell goods in your online store, your supplier ships to your customer, instead of you.

With dropservicing, first, you’ll be running a service-based business not a product-based business.

Examples of Product-Based Businesses
  • Selling hats
  • Selling women’s apparel
  • Selling pet supplies
  • Selling home goods
  • Selling cell phone cases
Examples of Service-Based Businesses
  • Offering accounting/bookkeeping sevices
  • Offering digital marketing services
  • Selling content writing services
  • Selling video editing services

With dropservicing, when you book a client for a service, you will outsource the work to someone else.

For example, if you run a digital marketing company that specializes in Facebook ads, you can bring on a team of contractors that have Facebook ad experience who can do the work for you.

So, you don’t need any Facebook ad experience yourself.

Your contractors handle it all!

For example, if you secure a new client that pays you $2,000/month to run digital marketing for their business, you could pay your contractor half and then you keep the other half.

So they get $1,000 and you get $1,000.

They can also have direct communication with the client, take conference calls, reporting, etc.

You will be totally hands off.

Interesting in trying this?

You can start small and begin with a marketplace like Fiverr.

Join as a seller, offer services and when gigs are ordered from you, connect with a contractor who can do the work for you.

Participating in Online Studies

An online study is a longer form of survey.

Instead of going through a quick 15-minute survey, a study may last 30 minutes or longer.

Studies are also more involved and may require a telephone interview, webcam participation or web interview.

The three studies I have participated in ran 35 minutes to 90 minutes long each.

  • Study 1 paid $100
  • Study 2 paid $125
  • Study 3 paid $400
Here are 3 online study companies you can join to learn more:

Teaching English Online

You can teach English to Chinese students online.

You’ll work in an online classroom, partnering with an ESL company and teach English to Chinese students.

The ESL company is very supportive and provides all the teaching materials to you, including the curriculum.

Generally ESL teachers can make up to $25/hour doing this.

Requirements

The requirements vary from company to company but generally, you’ll need:

  • Stable, high speed internet access
  • A headset
  • A bachelor’s degree

Here are some ESL companies to review:

Renting Out Your Garage

Turn your garage into a storage unit with a company called Neighbor.

They will pay you to rent out your space, which can include:
  • Your garage
  • Your attic
  • Basement
  • Spare bedroom
What will you store in your home?

Boxes of clothes, furniture, an RV, motorcycle, and more, just to name a few examples.

You can actually earn up to $15,000/year working with Neighbor, renting out your spare space.

How it works?
  1. List Your Space for Free
  2. Respond to renters
  3. Make money

Listing your space is free and easy.

Then, interested renters will reach out to you.

You’ll have the option to meet them in person in some cases.

Lastly, make money!

Click here if you’re interested in partnering with Neighbor, the AirBNB of storage units!

Getting Paid to Test Video Games

Did you know you can get paid to test video games?

It’s a fun way to make money and you can do it with these companies:

Renting Your Camera Gear

If you own camera and photography equipment, you could get paid to rent your gear with Kitsplit.

Why not monetize your unused equipment?

Selling Digital Prints on Etsy

You can create unique and creative digital prints on your computer and sell them right on Etsy.

The best part of making money this way is that it’s passive!

Do some work in the beginning to load your prints to Etsy platform and then sit back and watch your sales roll in with little to no effort.

Other products you can sell on Etsy:
  • Wooden signs
  • T-shirts
  • Coffee mugs
  • Pies and other baked goods
  • Pajamas
  • Home goods
  • And, more!

2. Early Retirees are Awesome Savers

It goes without saying.

If you want to retire in your 40s, you have got to be a great saver.

You can adopt the F.I.R.E. movement, which means financial independent retire early.

It’s a movement more and more people are getting behind and involves saving 50% or more of your income for the purpose of retiring early.

There are communities online in Facebook groups, subreddits and other places where you can find over F.I.R.E. adopters.

Are you good at saving?

If you’re unsure, ask yourself these questions:

  • Are you saving consistently?
  • Are you saving more over time?

You want to start saving something, even if it’s a small amount.

You can begin with saving $20/month and then grow to $200/month by the end of the year, for example, or save at a slower or quicker pace.

As long as you continue pushing yourself, so you can reach your early retirement goal.

Saving Big on Your Largest Expenses

Your two biggest expenses: house and car.

How can you save on these?

Saving on Your House Payment

Regardless if you have a mortgage payment, rent or have roommates, there is opportunity to save!

How can you lower your rent or mortgage payment?
  • Get a roommate
  • Refinance your payment
  • Negotiate a lower payment with your landlord
  • AirBNB your space
  • Move to a cheaper area
  • Move into a cheaper place
  • Move in with your family or back in with your parents
  • Move into your car

Getting roommates instantly slashes your housing payment down.

Not to mention, roommates can come with other perks like splitting the cost of utilities, groceries, etc.

For example, if you’re renting a 3-bedroom apartment for $2,500/month, you could bring on two roommates for the other rooms and split the costs three ways, saving 2/3 of your rent cost, right back in your wallet!

Where Can You Find Roommates?
Then, there’s refinancing your house payment.

This is you own your house.

Call your bank and ask about refinance options.

Consider your new interest rate, loan terms, payment and more when you make the big decision.

I had a family member refinance their house payment from $700/month to around $300/month-range which helped them during a time when they were cash-strapped.

There are tons of options with your mortgage lender, to lower your payment, refinance or not.

Ask for a lower payment with your landlord, if renting.

If you’ve been with your landlord for several years, you can use your good history as leverage to ask for a lower monthly rent.

It can cost them less to lower your rent than to spend money on marketing and possibly a real estate agent to try to rent out the space again after you move.

Next, look at AirBNBing your space, whether you rent or own.

AirBNB for owning your home means exploring the short-term rental market for a room, garage, or your entire place.

If you rent, you can do the same thing!

It’s called AirBNB arbitrage.

Going the AirBNB route is a good way to have your entire month’s rent/mortgage payment or more paid!

So you can have your $2,000/month mortgage or rent payment paid through short term renters and then pocket that money to your savings.

If you lived rent-free, think of how much faster you could save.

Read more about AirBNB and AirBNB arbitrage to see if it’s a great fit for you.

Moving to a cheaper place or cheaper side of town is an opportunity to save.

My sister lives in a big metro area with tons of amenities, shopping, and more.

She pays a premium to live on that side of town and it’s reflected in her monthly rent.

If you want to retire early, consider changing your lifestyle by moving to a cheaper area in order to save.

Moving in with your family or parents is another alternative.

When I moved to a big city a few hours away for college I transitioned from my small town apartment to my old bedroom at home with my parents, while I was waiting for the semester to start and move.

During that time, I paid no rent and it allowed me to save a ton of money which boosted my savings account and helped me tackle debts.

It’s a transition for sure but put your pride to the side and consider the bigger picture.

Who knows, it could be fun to live with your parents or family?

Moving into your car is an extreme lifestyle measure to take for saving but people do it.

Look at the silver lining.

No more rent.

And, the ability to travel wherever you want.

I followed a couple on social media who lived in a camper and traveled across the nation visiting every single state.

Tackle your bucket list early, especially if you have a remote job.

This doesn’t have to be permanent either.

You could do this for a short time to jumpstart your savings then settle in an area, moving into a house or apartment.

Before you make the jump, read this story on the true cost of living in a van to get an eye-opening look at this lifestyle.

Saving on Your Debt Payments

There are a few ways to do this:

  • Lowering your payments
  • Paying more toward your debts

Lowering payments means that instead of $500/month in credit card payments, you’ll pay $200/month.

Your creditors can do this to help you during times of financial difficulty or by request.

Keep in mind, although your monthly obligations are lower, that doesn’t mean your debt will be paid off faster or with less interest and fees.

Paying more toward your debt means you’ll have less money to save during the month but you’re sacrificing this in order to pay off your debt quickly.

You can take both of these options or one or the other.

How to lower your monthly payments?
  • Call your creditors and ask for lower payments
  • Negotiate a lower interest rate and/or more favorable terms
  • Qualify for a debt reduction or other programs that can help you lower your payments

Calling your creditors is easy.

Try one of these scripts to gain confidence in speaking with them, if you feel nervous to make that phone call.

Who can you call?
  • Credit card company
  • Student loan company
  • Cable provider
  • Cell phone service
  • Streaming TV service
  • And, more!
Ask for more favorable terms can mean…
  • Asking for a lower interest rate
  • Requesting a longer loan term, which can lower the monthly payment
  • Seeking out a lower minimum monthly payment
  • And, other arrangements

You can even look at debt reduction programs like the Public Service Loan Forgiveness Program which forgives the remaining balance of your Direct student loans after you’ve made 120 (10 years) of qualifying payments while working full-time for a qualifying employer.

Remember that early retirement doesn’t necessarily mean you have to be debt free.

It’s a goal for sure, but it may not be the most important goal.

Would you rather….

  • Reduce your student loan payments from $750/month to $200/month and retire at age 40 but continue to make payments in retirement, or
  • You can continue to pay $750/month and retire at age 45 with no student loan payment

Which option would you pick?

There’s no right answer.

It really varies from person to person.

Some people would be happy to work longer if it meant zero debt at retirement.

Others would savor those 5 years and be thrilled to make a small payment while retired.

Next, you can look at paying more toward your monthly debts.

This means paying your debts faster.

Paying debts faster means you’ll have less money to save every month but, at retirement you’ll have zero debt or less debt.

Lowering The Cost of Food

Food cost can be lowered, through cooking, using apps and tools, meal prepping, batch cooking, and more ways.

There are smart ways to save on food:

  • Use apps and tools
  • Use cash back sites
  • Meal prep
  • Batch cook
  • Cook at home
  • Stop eating out

Using Apps and Tools to Save Money

Take a look at these resources:

The Benefit of Cash back Sites 

With cashback sites, you shop online or in-person and get cash back on your purchases.

For example, if there’s an offer for 10% cash back when you buy from China Inn, your favorite Chinese food place, you can take advantage of that offer and get cash back off your order.

Cashback sites are great because they’re free and you can qualify for cashback at a variety of establishments like Walmart, Walgreens, local retail stores, boutiques, restaurants, and more.

Meal Prepping to Save Money

Meal prep is a big time saver and a big money saver.

Through meal prep you are preparing your food and meals in advance so when it’s time to grab dinner, pack your work lunch or the kids lunch, or pick up a snack, you have a food option ready to go.

No cooking on the spot and no waiting to eat.

Meal prep can help you lose weight too!

If you are looking to save money and time, try meal prepping!

Here’s how it works:

You plan and prepare your meals in advance.

You can use meal prep containers to portion out your servings and meals, then store in the fridge or freezer.

My family loves to do this with casseroles in the freezer, like lasagna.

And, dinners, snacks, lunches, etc. are stored in the fridge, which we eat on all week.

When you’re hungry, grab a meal and eat.

Here are some helpful resources to get you started:
Batch Cooking for Saving Time and Saving Money

Batch cooking is about preparing and cooking food in big batches.

You can take Sundays to make big batches of food for the week, then meal prep it and portion out meals and snacks for easy eating throughout the week.

The benefits of batch cooking include:

  • Saving time through cooking a lot of food at once instead of cooking every day of the week
  • Saving money

Need inspiration?

Have a look at these 15 delicious family pasta meals you can make for less than $10.

Cooking at Home and Avoiding Eating Out

Cooking at home doesn’t have to give you anxiety.

Home cooked meals taste far better than restaurant food or fast food.

When given the choice to cook at home or eat out, I’ve always chosen cooking at home because the food just tastes better.

I don’t get excited to eat out.

The few times I do grab a bite to eat on the go, it’s for social reasons, like having lunch with a friend during a work day or because I’m starving and I won’t be home for a while.

Advantages of Cooking at Home
  • Choose your food they way you want it
  • Get creative with cooking foods
  • Stress-relieving
  • Cheaper than eating out
Disadvantages of Cooking at Home
  • None

Abandon eating out and embrace eating and cooking at home.

Try menu planning.

Shop for your food.

Then, cook your meals.

Pair this with batch cooking and meal prep to save even more money (and time)!

Changing How You Travel

Travel is going to happen.

Whether the unexpected arises, like the need to travel across the country for a funeral, or a much needed vacation for rest and relaxation.

Moving toward early retirement doesn’t mean you can’t travel.

We’re going to talk about two types of travel:
  • Travel for Leisure
  • Travel fo Need

Travel for leisure are things like vacationing or going on road trips for fun.

While it’s recommended you heavily cut back on these, it doesn’t mean you have to abandon this kind of travel all together.

Here are some tips to save the most money when traveling:

  • Plan far in advance
  • Make a budget for your trip
  • Travel to non-touristy locations
  • Stay at a bed and breakfast instead of a hotel
  • Stay at an AirBNB instead of a hotel
  • Walk and bike ride at your destination instead of taking expensive taxis or Uber rides
  • Book your flight and accommodations early
  • Travel during the off season

You can get a great deal on your vacation too, if you are a member of websites like: Groupon, Living Social, or sign up for cheap flight alerts through places like Kayak.

Next, traveling for the need means your required commute like going to work, school, grocery shopping, running errands, going to doctors appointments, etc.

Apart from carpooling or taking public transit (two cost-effect solutions), you can save money on your car expense in other ways, like:

  • Using the cheapest gas (check out Gas Buddy to find out which gas stations in your area has the best prices)
  • Getting your vehicle maintenance (oil change, tune up, etc.) on time
  • Not speeding
  • Not carrying a lot of weight on your vehicle (like transporting luggage on your roof)
  • Using unleaded fuel
  • Shopping around for car insurance

Extreme Saving Strategies

Would you go to the extreme with saving?

This can really push you to the limit.

Here are some crazy, extreme saving examples:
  • Grooming at home (doing nails, facials at home, etc.)
  • Shave your head or cut your hair at home
  • Turning in recyclables for cash (cans, glass, etc.)
  • Eat like a college student
  • Make gifts instead of buying them
  • Say no to disposables (no toilet paper or paper towels, no trash bags, etc.)
  • Don’t buy ready-made or convenience foods (no frozen dinners, no sliced cheese or sliced bread, etc.)
  • Only drinking water
  • Exercise at home instead of buying a gym membership
  • Shop second hand (buying used instead of new, like thrifted clothes)
  • Move in with your parents

Read more on extreme saving strategies to explore more ways to save.

3. Early Retirees Aren’t Afraid to Sacrifice

All things in life aren’t easy.

Early retirement is one of those things.

If everyone could retire early, I think they certainly would.

Another habit of people who retire in their 40’s is that they make sacrifice.

Examples of sacrificing in order to retire early:
  • Cooking at home consistently
  • Scaling back to once a year vacations instead of multiple vacations per year
  • Budgeting
  • Saving at least half your income

Could you make these sacrifices?

If you’re willing to work hard and sacrifice in order to achieve your goal of retiring early, then you share this habit of early retirees.

When I decided to become an entrepreneur, my sacrificed spanned 18 months, in which I was working two jobs, recovering from getting my masters degree, working on my business during every spare moment.

The 9 to 5 I was working was my first “real” job right out of college.

I worked for a great company earning the most I had ever made from a job.

I had excellent benefits, competitive pay, I loved my workplace, great amenities, I lived close to work, and other perks.

I just hated my job.

I stuck it out for 7 long years before I was able to quit, thanks to my business taking off!

The business was an e-commerce store and a year or so after launching it, it replaced my 9 to 5 income.

And, I quit!

Take a look at the schedule I worked prior to quitting, running my business and working full-time:

My schedule looked like this:
  • 5am Wake Up
  • 5:30am Feed baby
  • 6am Get ready for work
  • 7am Drive to Work
  • 8am Start working
  • 10:30am First Break-work on business
  • 12pm Lunch-work on business
  • 3pm Afternoon Break-work on business
  • 7pm-get home from work
  • 8pm-work on business
  • 2:30am-go to bed

It was a wild schedule and very tiring but this was my sacrifice.

Moving toward early retirement can be similar.

You might be cutting back, doing more, making lifestyle changes, all to reach early retirement!

4. Early Retirees Have Drive and are Goal-Driven

Next, people that retire in their 40’s have a real drive.

Goals are important to them and it makes sense, doesn’t it?

Retiring early is a goal.

It’s one of the seven great habits of successful people.

5. Early Retirees are Big Planners

Planning is so important for early retirement.

Because to retire early, the plan must start early in many cases.

That means crafting a strategy in your twenties to reach retirement in your forties.

This all centers around planning.

And a plan can change.

Life happens, change is inevitable and so you adjust your plan to new developments that happen during the years.

Early retirees, these people that plan are also well-organized, determined and have excellent follow through.

6. Early Retirees Wake Up Early

The most successful people wake up early:

  • The CEO of Apple starts his day at 3:45am
  • Oprah Winfrey rises at the crack of dawn
  • Michelle Obama
  • Indra Nooyi, and others, according to this source

It’s all about developing a routine.

Starting off early is a critical part of my day.

I begin the day at 6am everyday, even weekends.

I am really excited to start the day and waking up early lets me do that.

Plus, if you rise early, you actually fall asleep at a reasonable time, which is a great feeling.

No more college days of staying up until 3am and sleeping until 4pm in the afternoon.

Give this a try and see if you feel different.

7. Employer Matching 401(k) Maxed Out

Your 401K is your company retirement account.

You choose to save a percentage of your pay towards this retirement account every pay period and some employers do company match.

Company match is generally up to a certain percentage, like 8%.

This means your workplace will match your retirement contributions dollar for dollar up to 8%.

It’s like making double payments towards your retirement and you should never pass up free money!

8. Early Retirees Are Bold and Think Outside the Box

Early retirees are bold.

They think outside the box and deciding to work toward early retirement, which is a huge decision.

Examples of bold and extreme ways to save money.

9. Early Retirees Are Dreamers

Dreamers have big goals.

They imagine the future and work hard to achieve it.

This is a critical first step to starting your journey to early retirement.

Dream about that life, whether it be sailing across the world, RVing around the country or enjoying a relaxed life at home.

Dream big.

Final Thoughts

Early retirees have many things in common.

Aside from being organized and goal-driven, they have some much needed habits when it comes to making money and saving money, that is required to retire as early as 25 years before typical retirement age.

Do you share any of these traits?

What’s the reason you’d like to retire by 40?

Share your thoughts down below in comments.

Retire By 40: 7 Habits To Help You Reach Financial Independence Early
Jennifer Leach



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