To Achieve Your Greatest Financial Goals, Start With “Why”

Seven years ago, Tanja Hester and her husband, Mark Bunge, were busy. They were working more than 40 hours per week and had to be accessible to their employers at all times.

“We didn’t see ourselves doing that same work for forty years and being able to stay healthy with that level of pressure and demands on our time,” Hester says. “What we really wanted to do was spend more time in the mountains. Skiing in the winter. Backpacking in the summer. We didn’t think we’d be able to cross off everything off our life list while staying in cell phone range.”

There were additional concerns that made staying in the traditional workforce for forty years undesirable.

Hester’s father has a neuromuscular disability, which limits his mobility. The disease is genetic, which means she could face the same fate—potentially starting as soon as age 40.

Her timeframe for climbing mountains may be abbreviated, so she and Bunge decided to set a bold goal: early retirement.

Your “Why” Can Help You Reach Your Financial Goals

Knowing your “why” is always important before setting a massive goal. Tanja’s “why” was very clear.

“It was very much driven for me not by not wanting to work or not liking my job,” she explains, “but there was a fear aspect there. We all only have so much time in our lives. None of us know how much we have. I had a picture of my dad–of what could happen to me at a very young age. It was scary for me.”

When you’re going through the long slog of meeting a massive goal, it’s easy to become disinterested or discouraged. Those feelings didn’t hold a candle to Hester’s justified fear, so it was easier for the couple to push through them.

This year, both Hester and Bunge were able to turn in their resignations at work, citing “early retirement” as the reason for their departure.

They’ve maintained good relationships with their employers and plunged into all the freedom that comes with financial independence while Hester is still in her 30s.

How Did They Do It?

After making early retirement a goal, the very first step the couple took was cutting expenses. They ditched cable. They got rid of their expensive condo in LA. They started cooking at home, and, yes, they even dropped the lattes.

When they bought a new place, they bought less house than they “needed,” allowing them to pay off the mortgage in 5.5 years. Now that they’re retired, the only housing expenses they need to worry about are maintenance and taxes.

Simply cutting expenses isn’t enough, though.

You have to actually stash away the money you’d be spending on coffee and cable if you want your savings and retirement accounts to grow. That’s exactly what Hester and Bunge did by automating their savings and investing.

“Making the money invisible to ourselves [through automation] was a really big step,” Hester says. “We didn’t see it, so we didn’t have to make a choice to spend it on something or not. We all have so many decisions to make every day–if you can eliminate the spending option you’re more likely to be successful.”

Finally, they avoided lifestyle inflation—even when they earned raises or bonuses.

“We’re living at the same level we were ten years ago,” Hester explains. “We make significantly more, but we automatically save pay increases and bonuses. We had a period in our 20s when we did that [spent more money with every raise], but the early retirement goal really helped.”

Can Anyone Do This?

Hester is passionate about her journey and shared the majority of it in real-time on her blog, Our Next Life. When I ask her if she thinks it’s reasonable for anyone to achieve the same level of success, she pauses in a moment of thoughtfulness.

“I do not think this is something anyone can do,” she says, nodding to her relatively high-income level. “If you’re earning minimum wage or barely scraping by, it’s not within reach.”

However, she says that if you have some disposable income at the end of each month that you’re spending on things you don’t really value, it is achievable.

“The more you earn and the less you spend, the faster you can do this,” she says.

She notes that many Americans will be forced into retirement by disability or health complications and that the majority will not feel financially prepared when they do. That means that even if you don’t achieve early retirement, you’ll be ahead of the pack if you implement these strategies to fully fund a traditional retirement.

“Everybody’s circumstances are different,” she says. “Small amounts of saving–if done consistently over time–really do add up. Maybe early retirement isn’t realistic for everyone in every situation, but if you get a solid emergency fund, are able to have enough saved to quit a terrible job, or retire at a normal age, that’s still totally worthwhile.”

More about Tanja

• Want to retire early? Tanja Hester went from freewheeling spender to financial independence, and says it’s simpler than you think via Marketwatch
• I Retired at 38. Here’s What I Didn’t Expect. via The Cut