How Much Does It Cost To Live A Modest Lifestyle?

by retirebyforty

It took a lot of lucky breaks for me to retire from my engineering career before 40. I was able to find a well paying job right out of school and started investing right away. I had some trouble with investing at first, but I settled on a long term strategy and was able to steadily increase our net worth over the last 20 years. I also have a great partner in Mrs. RB40. She values financial security and shares most of my goals. We wouldn’t be where we are if we hadn’t worked together.
I’m very grateful for my good fortunes, but one thing that was always under our control was our lifestyle. We continue to live modestly and have never accumulated any consumer debt. Our income rose steadily throughout our 20s and 30s, but we always lived below our means. We had years when we were very frugal and some where we loosened up a bit.
But what exactly does it mean to live a modest lifestyle? It’s in the eye of the beholder. My definition of a modest lifestyle might look like living in poverty to some people. I’m sure others would view our lifestyle as luxurious. The important point is to live below your means so you have money left over to invest. Anyway, I thought I’d share our modest lifestyle with you. I’d love to hear what you think.
To start off, let’s take a look at the nifty Family Budget Calculator from the Economic Policy Institute. It measures the income a family needs in order to attain a modest yet adequate standard of living. It will be a useful comparison point for us since location can make a huge difference in the cost of living.