There are basically three big categories in a normal household budget that need to be severely modified to make retiring extremely early feasible. These are housing, transportation, and food.
Whereas I have already dealt with housing, I am still a bit reluctant to deal with transportation. I have this image of readers sitting clutching their steering wheel with a wild look in their eyes muttering “My precious!
Therefore I’ll start with food.
People are generally recommended to eat a varied diet. I suspect that the general argument is similar to that of index fund investing: So many people are clueless about nutrition so if experts recommend eating a little bit of everything, chances are that nobody will develop any nutritional deficiencies — well other than eating too much. This I believe is a result of insisting on eating three larger meals a day despite NOT doing the hard physical labor that that meal plan was originally designed for.
During my first 3 years, I ate mostly lentil soup (lentils, onion, garlic, cheese, rice, carrots) and tuna sandwiches with lettuce or kale. This accounted for 75% of my cooking and it was certainly healthier than the ramen noodles and cafeteria food my colleagues subsisted on. I would also eat a lot of stir fry (beans, onions, carrots, apples, broccoli, rice).
Today we eat somewhat more interestingly. However, some lessons are still worth retaining, namely that by keeping to only a few meals, which together cover all bases, it is possible to learn to cook based on a small set of staples (rice, beans, onions). These staples are then bought in 10lbs bags.
Avoid preprocessed food. Personally I draw the line at canned tomatoes and bread. I would never buy sauces, powders, or frozen ready meals.
One will get used to eating just a few different kinds of meals surprisingly quickly and be as happy about eating as someone who eats out all the time. The great thing about this is that being invited somewhere for their regular dinner is a real treat. Those who eat a standard diet require much more to be happy about eating something they don’t usually eat. Of course if gourmet food is your thing, then maybe food is the area where one should spend a little extra effort or time (and maybe even money). Meals can be varied by adding loss leaders as the supermarket offers them up.
Many have way too many kitchen gadgets. See this post on how to reduce your kitchen to something more useful without having to dig for everything.
Before switching to a staples based dinner plan, I recommend getting rid of all the weird things in your cupboard. The best way is to not buy anything until your last strange ingredient is gone. Just imagine that there was an earth quake and the stores were closed for a week. How would you do?
The alternative is to give it away on freecycle. Yes, they take food.
I highly recommend flipping the standard western idea of basing all meals on milk and meat around. Consider going vegetarian.It is much less expensive both in terms of food cost but also in terms of reduced medical costs (cholesterol and all that). Also it is very hard to stay overweight on a vegetarian diet. The emphasis on carbs also results in more energy. Meat and milk is generally not healthy to eat (but I do admit it does taste good!). In addition, short of not having children, going vegetarian is the most effective way of reducing your impact on the world’s food supply. It takes 17 grams of plant protein to make 1 gram of meat protein (and a huge amount of water as well). The problem is that we, the rich people of the world, can easily afford to price the poor people out of the market, e.g. paying 17 times as much for our protein, and that results in starvation. Incidentally do not throw away leftovers. It is wasteful and in light of the above also morally wrong.
So consider meat a treat. Besides, leftovers without meat tend to store longer.
I gave up on the whole milk idea when I moved away from home. The idea of picking up a milk every six days (in myCountry the regulation against preservatives is pretty tough, so milk tends to expire within 6 days) was too inconvenient.
One way of not buying too much unneeded food is to strictly adhere to a grocery list. This is not optimal though. Using a list leads people to buy food even when it is not on sale. I only buy food when it is on sale! In general DW buys our food and she is not as stingy as I am, so we spend more than we have to … the joys of already being financially independent is that I can spend surplus money on things like that … laziness Anyway, a much better trick is to shop on foot. That means bringing a backpack and walking over to the supermarket instead of driving.
I know that sounds outrageous. My precious! Probably as outrageous as the idea of just driving out to get something whenever one needs it still sounds to me. But put on a backpack tomorrow and walk over to the nearest supermarket. I have always managed to live within a thirty minute walk from the nearest one, and chances are that you do too. You are now limited by the size of your backpack . Also the desire to just head out and get something rather than trying to improvise a recipe without that most likely irrelevant ingredient will be stronger.
Incidentally you can bike too depending on what kind of load you can handle on a bike. I was always set up to handle more on foot (about 40lbs) than on the bike (about half that).
Food limit: Depending on where you live: $50-75/person/month.
This will get you started: Buy a 10lbs sack of rice. Onions, carrots, kale, raisins, soy sauce, olive oil (large one), and black beans (the big bags are at your ethnic grocer). Cook the rice and the beans. Slice up the onions, carrots, and kate. Fry the kale, add the carrots, fry again, add the onion, fry, add the raisins, beans, rice, and soy sauce. Mix around. Done. If nothing else, try eating this for a few days a week from now on until you perfected the mixing ratios.