Downsizing is great but, at some point, it is impossible to downsize your way to financial independence or a comfortable retirement. The challenge for each of us is to downsize where we can AND increase our value -- either as employees or entrepreneurs (or both). Employees and business owners get paid for the value they offer. Extract the net profitability generated by that offering, save and invest it (and your downsized savings), let it compound and a decent retirement is possible.