According to them, there are a few boxes to check off before saying goodbye to the nine-to-five: Making sure your savings are large enough to cover annual expenses, maximizing your salary, finding a balanced lifestyle between saving and spending, and having a clear picture of what you want your early retirement to look like.The amount of money you need to have saved before retiring early depends on your spending habits.
Northrup even advises aspiring early retirees to avoid stopping all meaningful work. "You should try to identify how much income you could earn doing a job you love when you want, where you want, and how you want in a way that fits your ideal lifestyle," he said. It really does matter whether you're earning $50,000 or $500,000, Kenny said, but not in the way you might think: "Someone who is making $50,000 and saving $20,000 is much better off than someone making $500,000 and saving $100,000."With $50,000 in earnings, $20,000 in savings leaves $30,000 in expenses. Based on a 30-year retirement, you would need $900,000 in savings to retire .
Tackling these costs "doesn't mean you should live on pennies a day, but it does mean you should be crystal clear on what you value and make sure your spending is aligned with those values," he added, emphasizing that you should exercise frugality in the areas youThe most critical and controllable variable in financial planning is your spending, Northrup said. He suggests creating spending guardrails: a lean budget , moderate budget , and fat budget .
"That might work when you're in your 30s, but when you're 60 you may not enjoy that lifestyle anymore," Kenny said. "You may not be able to change that after being out of the workforce for 25 years." darekm101/Getty Images