Cut These 11 Expenses Now If You Hope to Retire Early

Maridav / Shutterstock.com

Many people dream of retiring early. In fact, there’s even a movement these days, called FIRE, that offers the hope of financial independence (“FI”) and the ability to retire early (“RE”) from the grind.

However, it’s important to note that in many cases, FIRE requires a great deal of planning — and sacrifice. You might need to reduce or eliminate some spending to set aside enough money to reach your FIRE goals.

Let’s take a look at some of the expenditures common to U.S. households, according to the Bureau of Labor Statistics (BLS). Then, we’ll look at ways to reduce spending so that you’re more likely to reach FIRE status.

Note: The following costs from the BLS are for households of all ages and many sizes, including families, single people and more than two people living together.

1. Shelter

Monkey Business Images / Shutterstock.com

The average spent on shelter by U.S. households in 2019: $12,190

Want to reduce your housing costs? Consider getting a roommate or downsizing. You could even move in with relatives for a time.

However, if you prefer to maintain your own home, you can turn it into a moneymaker. Rent out a room through a vacation rental website like Airbnb or VRBO, rent out your whole home when you’re not there, or explore the other options we detail in “8 Ways to Earn Extra Income With Your Home.”

You’ll pay off your mortgage faster, reducing your costs and providing a place to live debt-free after you retire.

2. Groceries

Dragon Images / Shutterstock.com

The average spent on groceries by U.S. households in 2019: $4,643

Looking to cut your food bill? While coupons can help, there are other ways to reduce what you spend each week — from buying bread at bakery outlets to learning to make your groceries last longer.

On top of that, if you want to make some extra money, there are ways to earn cash delivering groceries. A little extra, set aside from your gig, can get you to FIRE status that much faster.

3. Vehicle purchases

pathdoc / Shutterstock.com

The average spent on vehicle purchases by U.S. households in 2019: $4,394

If you want to avoid this cost, one way is to get your car to last a little longer to eliminate the need to buy something else.

If you do make a vehicle purchase, consider buying a late-model used car. Some gently used models can save you as much as 56% compared with the price of a new model.

4. Eating out

Monkey Business Images / Shutterstock.com

The average spent on eating out by U.S. households in 2019: $3,526

Maybe it even makes sense to spend more on groceries while spending less on eating out. Cooking at home is usually a lot cheaper than getting take-out or using meal kits. It certainly costs less than eating at a restaurant.

That doesn’t mean that you can’t go out. With a little planning, it’s possible to slash your restaurant costs, as we detail in “A Former Restaurant Critic Shares Her 11 Best Tips for Dining Out Cheaply but Well.” All your savings can be put into an account designed to help you reach FIRE goals.

5. Gas and motor oil

Monkey Business Images / Shutterstock.com

The average spent on gas by U.S. households in 2019: $2,094

Keeping your car running can be costly. There are ways to save at the pump, though. Taking the time to reduce what you spend on gas can pay off in the end.

Another way to save money on gas is to use public transit if it’s available and reliable. Plus, if you’re not using your car, you can make extra money by renting it out. That can offset some of your costs and even increase the capital you end up with, helping you get to FIRE.

6. Clothing and footwear

immfocus studio / Shutterstock.com

The average spent on clothing by U.S. households in 2019: $1,883

One of the best ways to save on clothing is to shop at thrift stores or secondhand shops. For pointers from a veteran thrift store shopper, check out “11 Secrets to Finding Quality Clothing at Thrift Shops.”

There are also plenty of online sites offering gently used clothing, including brand-name and designer clothing. You can even make money off the clothes you no longer wear by selling them online using a service like thredUP.

7. Cellphone service

Oleksii Didok / Shutterstock.com

The average spent on cellphone service by U.S. households in 2019: $1,218

Looking to save hundreds of dollars a year on cellphone service? Consider switching carriers, joining a family plan or buying your phone outright instead of buying it on a payment plan. With a little planning and creativity, you can get the connectivity you crave for less.

For help finding cheaper service or a cheaper phone, stop by our Solutions Center and check out Money Talks News’ phone and plan comparison tool.

8. Car insurance

bbernard / Shutterstock.com

The average spent on car insurance by U.S. households in 2019: $1,545

Take the time to shop around for car insurance each time your policy is up for renewal, and you could save money each month. If you don’t have time or don’t want to comparison shop, a third-party service like The Zebra or Gabi can do it for you and give you quotes to choose from.

Or, avoid the need for car insurance completely by using public transportation.

9. Alcoholic drinks

YAKOBCHUK VIACHESLAV / Shutterstock.com

The average spent on alcoholic drinks by U.S. households in 2019: $579

Want to reduce your drinking bill? The best way to save is to give it up. If that’s not your style, consider buying alcohol at a warehouse club. You can get a lower price, and those savings can fuel your FIRE effort.

Not a warehouse club member? That’s not a problem for some chains, including Sam’s Club — you can buy wine, beer and spirits there without a membership.

10. Prescription drugs, over-the-counter drugs and vitamins

Diego Cervo / Shutterstock.com

The average spent on drugs and vitamins by U.S. households in 2019: $486

You can slash prescription drug costs by as much as 50% by using tips such as paying with a discounted gift card or even paying out of pocket for some medications, as we detail in “5 Ways I Slashed My Drug Costs up to 50%.”

Take the time to shop around and compare prices, too. There are free websites that make this easy, and you might be surprised at how much you can save.

11. Cleaning supplies

gpointstudio / Shutterstock.com

The average spent on cleaning supplies by U.S. households in 2019: $185

This category includes laundry detergent, which can be expensive. You might be surprised to learn that you might not need laundry detergent at all on lightly soiled clothes. But if you do need detergent, it’s relatively easy and inexpensive to make. See “3 Easy Ways to Get Laundry Soap for Nearly Nothing.”

Other cleaning supplies are just as easy and cheap to make on your own, as we detail in “Never Buy These 7 Overpriced Cleaning Products Again.” There’s no reason to spend a lot on cleaning supplies.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
7 Mistakes Guaranteed to Ruin Your Retirement

Make even one of these money mistakes, and you’ll probably end up eating ramen noodles in your golden years.

The Annuity Everyone Needs — and Anybody Can Get

This simple strategy can put more money in your pocket during retirement.

6 Investing Tools That Help You Diversify

Here’s how you can lend to startup businesses, fund social causes or get in on investments once available only to the very rich.

15 Great Amazon Finds You Can Buy for Less Than $5

These products offer big value at a small price.

Homeowners Say These 2 Kitchen Appliance Brands Are Best

One brand takes five of the top honors, while another ranks highest in three categories.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
If You Find This Thrift Shopping, Buy It

Whether you resell it for a big profit or add it to your own wardrobe, this type of clothing is a hidden steal.

10 Things Frugal People Never Buy

If you’re a true tightwad, the mere thought of spending money on these items gives you the willies.

7 Social Security Benefits You May Be Overlooking

There’s more to Social Security than retirement benefits.

This Simple Mistake Might Weaken Your COVID-19 Vaccination

Avoid doing this before you get vaccinated.

10 Cars You Are Most Likely to Keep for 15 Years

The cars that owners hold onto the longest have one thing in common, a new study shows.

3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

The 6 Best Investing Apps for Beginners

If you’re looking to ease into investing in the coronavirus economy with just a little money, check out these easy-to-use tools.

7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

Taking a Multivitamin? Here’s Why You Should Reconsider

A new study has bad news for the millions of Americans who spend money on multivitamins.

13 Amazon Purchases We Are Loving Right Now

These practical products make everyday life a little easier.

11 Products Now in Short Supply Due to the Pandemic

Many goods we take for granted have become tough to find in 2021.

9 Things You Should Never Leave in a Car

Thinking of leaving these possessions in a car? Prepare for unexpected consequences.

9 Mistakes People Make When Cleaning With Vinegar

Cleaning with vinegar can save you a lot of money, but using it like this can cost you.

8 Things You Should Replace to Improve Your Life Today

Being frugal isn’t smart if you put off replacing these items.

10 Things Successful Retirees Do Differently

These habits and characteristics can help put you on the track to success.

7 Income Tax Breaks That Retirees Often Overlook

Did you realize all these tax credits and deductions exist — or that they apply to retirees?

7 Costly Health Problems That Strike After Age 50

As we age, our bodies wear down. Here is how to cut costs associated with some common ailments.

Prepare to Pay More for These 31 Drugs in 2021

More than 700 prescription medications have seen price hikes so far this year. Here’s a look at the worst.

29 Purchases That Can Save You Money Every Day

Sometimes, you’ve got to spend to save.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.