Although I must admit... that my early retirement plan was quite a fuzzy plan, I did do a number of things that made the decision to retire at age 55 an easy one. One of those things was setting up a second special saving account at our Credit Union. It was a nice simple system. The general idea was as follows. It can be expanded to more than one extra account to help manage your money.
In our main account we had the credit union set up a few automatic transfers out of that account and into the other account(s) at the beginning of each month. After that, everything was on automatic. It was like having deductions come off my paycheck. I would deposit my paychecks twice a month into our everyday use account and the automatic transfers happened without me even thinking about it.
During the years I had a rental property I wanted the rent to go into a special account so I could track expenses and so on. I set up an auto transfer for it as well. I would deposit the rent check along with my paycheck into the everyday use account. This saved me having to fill out a second deposit slip.
From time to time I would then take money out of the second savings account and invest it into GICs or Canada Savings Bonds depending upon which option had the best interest rate.
On paper I kept track of how I planned to spend the savings. Part of the savings were for known annual large expenses such as: auto insurance, Christmas and so on. These annual costs were estimated into monthly amounts and summed to find the total monthly amount to be transferred. In other words, part of the savings were designated and part was unspecified savings for future use. In this way we always had the money to pay cash for things such as auto insurance or the purchase of the next used car and so on.
Its amazing how the unspecified general savings added up over the years. In addition, knowing you have the money set aside for big ticket items also makes life less stressful.