It is very possible to retire wealthy, without ever having earned more than $100,000 a year. Most of this comes from utilizing principles you may have heard of like compounding interest, that I won't get into here, but the benefit of that comes mostly from putting away the most money possible, while you are as young as possible. Being an expert level saver is the pathway to being an aggressive investor, and will give you a leg up on many who earn far more than you, and can even help you financially surpass them. I engage in most of these practices, enter extreme saving. Here's some of the best ways how:
Cook healthy at home:
The smart money cook at home at least six nights a week, using fruits and vegetables purchased from the market, generic brand dry goods, and drink just water or tea which is also healthier. Lack of time should never be an excuse, especially with things like freezing, and crock pot cooking.
Invest in really learning the art of cooking, and owning a few high quality cooking tools like a good knife, both will pay for themselves over time by making the process more enjoyable. Lastly, reading cook books helps get you into the mindset of how to combine foods so as to waste little. You can even go beyond this, like using lemon as a cleaning agent for example, and more.
Get in the haggle mindset, and the "just ask" mindset:
People are often surprised on what they can negotiate the price of. If you are unsure, why not ask? It's amazing how people will fear trying this. If I am in a store talking to a sales person, I always ask if they price match other stores. On the phone with customer service for whatever, I always ask "what can be done about this?" regarding wrong doings on the companies' part. Many don't realize how much leeway a phone rep has to grant customers incentives, for example: my website was down a few times this year due to the hosting, so I complained to the host company and asked what could be done. I got a couple months of free billing each time just for asking them to make me feel better.
Putting finances on auto-pilot where makes sense:
I set up automatic payments on my credit card, direct dividend reinvestment in my brokerage, a Google reminder monthly to purchase the same amount of the same target date fund ( a tried and true catch-all approach to investing for the averages). This type of thing reserves willpower to use for more money saving thinking, and also it enforces discipline that you may not otherwise have for things like cultivating a good credit score.
Is using various driving methods for extreme fuel savings. I started doing this in the fall, and figure I will save over $1000 from it this year. Google "hypermiling tips" and it will get into what I won't that is beyond the scope of this, but know that hypermiling is a great practice as it is not only money saving, but it is the safest way to drive, and it's "green". Hypermiling is marginally slower to destinations than driving fast, due to the concept of bottle necks like traffic and red lights.
Comparison shop online:
There is zero excuse not to comparison shop when online shopping to see which site has the lowest price or if something in person is cheaper online. Also, before you head out to shop, Google the item you plan on buying and "coupon." Many times there is a discount code or printable coupon that can save you 15%, 25%, etc.
Offset your fuel/auto costs with the Peer-to-Peer economy:
By joining some kind of P2P service like Lyft or Taskrabbit for example, (Disclosure, I have financial ties to both) on the way back from a friend's house, the airport, grocery shopping or whatever, you can go on duty and do an errand for someone, thus helping to offset your car's operating costs. By the way, those miles while on duty are tax deductible given it is income while driving, this years government rate is $.56 a mile.
Research saving on furniture before you buy from IKEA:
People's average bill at IKEA is huge, make sure you have the Nordic retailer down cold, before you go. There's all kinds of ways to save time at the store, hassle assembling, and getting deals like in their clearance section. I wrote an all encompassing article on this topic for Huffington Post.
Approach your entertainment differently:
I don't have cable, rather, via my Amazon Prime account I get to watch
many great movies for free; I also utilize Crackle, YouTube, and video.pbs.org. If I really needed to see something special not otherwise available, I might just go to someone's house. I frequently look up about and take advantage of free events in my city of Boston, like donation days at the art museum. Free civic events also make for fun and affordable dates. All cities have events like this you can discover with a simple search, or, many libraries facilitate finding out about them.
A healthy and affordable mindset for entertainment is also to increasingly think of free sporting activities as doubling as "something fun to do". One of my favorite free activities is ice skating at my local public rink during their free skating times, maybe in your town it's the beach, or going for a Sunday hike in a State park.
Understand pricing and value of merchandise at stores.
When I go to stores to buy something like cereal for example, not only am I not opposed to generic brands which are typically the same ingredients as the brands that advertise (and cost more), but amongst those generic brands, I always look at the unit price. The unit price is the real way to figure out what is cheapest. You may have heard as well, don't shop hungry, and don't shop without a list-both help ensure that you don't make foolhardy purchases.
With various hard goods, the best true cost will come down to an honest look at how well the item holds its value overtime. For example an $80 pair of shoes I have owned over fifteen years have an "amortized" cost of less than a nickel a day, while a $20 pair that only lasted me a year are not as good a value ultimately.
Beware buying in bulk.
Sometimes buying in bulk is not actually cheaper (another reason to check unit price). Also, think about a single person chasing the discount to buy a gallon of milk only to have to throw out what they can't drink in time.
Investing for tax advantages: Financially in your investing account, when holding individual companies, try to err towards holding positions for over a year for the long term tax advantages that ensues. Consult with your broker or an accountant about best practices.
Use credit card reward points for cash:
Research which credit card can personally give you the most cash rewards. Don't be tempted to take any of the other rewards, as cash is king. The only way it would make sense would be to take a higher than cash value reward in something that you have to purchase anyway like free groceries or gas for example.
I like nerdwallet.com for comparing cards. I recently chose and applied for a card that will give 2% cashback on all purchases, as it could link with my brokerage account to direct deposit into it the rewards I earn-more automation!