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Regarding “ To accomplish the above (without having to significantly increasing your income” How do you judge what is important for you and what is like luxury

Regarding “ To accomplish the above (without having to significantly increasing your income” How do you judge what is important for you and what is like luxury which you don’t need right away ? I mean let’s say iPad is nice to have and would enjoy but it is not necessary or must have . But should I not buy something I don’t need to right now but save for future which is very random or unsure . I mean let’s say I been saving all long hoping to have a nice life after retirement but all of sudden I got hit by bus and thinking I should have enjoyed all things I wished sure rather than saving when on death bed . How to balance ?

derekp7 5y ago
Unfortunately, there really isn't hard and fast rules about this, as it is different for each person. And sometimes you have to get some life experience to figure out what you did sub-optimally in the past, or try to learn from experience of others and see if that applies to you. I noticed that I'm happier now that I don't have payments going out for a lot of things (just mortgage and a car payment at the moment). I was looking into getting a motorhome, which I think we would really enjoy. But after thinking about it for the last couple years (and looking at industry quality issues), I figured that the maintenance plus depreciation totaled up to about twice what it would cost to do several 3-4 day weekend getaways at a nice resort every year. As for buying things that will bring you joy, it isn't an all or nothing deal. Instead of getting the top-of-the-line tablet, see if a cheaper one would be 90% as good, and that leaves you money to get the watch also. On the other hand, if you cheap out too much on a purchase (say spend $300 on something that really doesn't bring you joy where the $800 item would), then you didn't save $500, you really wasted $300. But the biggest rule I have is to not go into debt unless the payments are fairly close to what you would be paying out regardless. So buying a house (at least back before the prices got way out of control) would cost you close to the what you would be paying in rent, but you get to do so much more (extra rooms, yard, garage for tools and gear, etc). But putting a $3500 Macbook Pro M1 on a credit card that take you 5 years to pay off ends up causing you more stress than the joy that the purchase brought you (because the debt doesn't go down as easy as it goes up). Credit card debt is probably what put the most strain on my life over the previous couple decades (both personally and on my family, as I'd always be complaining about having to spend money on something). The day I wiped out my credit card debt is the day I started feeling secure. It allowed me to go purchase a new car instead of driving a 15 year old vehicle that was starting to need monthly repairs, and the monthly payments on that didn't bother me because they fit in my budget while still having disposable income left over. Which allowed me to build up an emergency fund. Which now means I don't have to think about money if I want to go out and purchase that tablet, because I know it isn't going to add to my monthly debt payments. And if we want to take the kids to a water park resort for a 4-day weekend, again that is something that is budgeted for and not just thrown on a credit card to be paid off over the next few years.

derekp7 5y ago

Unfortunately, there really isn't hard and fast rules about this, as it is different for each person. And sometimes you have to get some life experience to figure out what you did sub-optimally in the past, or try to learn from experience of others and see if that applies to you. I noticed that I'm happier now that I don't have payments going out for a lot of things (just mortgage and a car payment at the moment). I was looking into getting a motorhome, which I think we would really enjoy. But after thinking about it for the last couple years (and looking at industry quality issues), I figured that the maintenance plus depreciation totaled up to about twice what it would cost to do several 3-4 day weekend getaways at a nice resort every year. As for buying things that will bring you joy, it isn't an all or nothing deal. Instead of getting the top-of-the-line tablet, see if a cheaper one would be 90% as good, and that leaves you money to get the watch also. On the other hand, if you cheap out too much on a purchase (say spend $300 on something that really doesn't bring you joy where the $800 item would), then you didn't save $500, you really wasted $300. But the biggest rule I have is to not go into debt unless the payments are fairly close to what you would be paying out regardless. So buying a house (at least back before the prices got way out of control) would cost you close to the what you would be paying in rent, but you get to do so much more (extra rooms, yard, garage for tools and gear, etc). But putting a $3500 Macbook Pro M1 on a credit card that take you 5 years to pay off ends up causing you more stress than the joy that the purchase brought you (because the debt doesn't go down as easy as it goes up). Credit card debt is probably what put the most strain on my life over the previous couple decades (both personally and on my family, as I'd always be complaining about having to spend money on something). The day I wiped out my credit card debt is the day I started feeling secure. It allowed me to go purchase a new car instead of driving a 15 year old vehicle that was starting to need monthly repairs, and the monthly payments on that didn't bother me because they fit in my budget while still having disposable income left over. Which allowed me to build up an emergency fund. Which now means I don't have to think about money if I want to go out and purchase that tablet, because I know it isn't going to add to my monthly debt payments. And if we want to take the kids to a water park resort for a 4-day weekend, again that is something that is budgeted for and not just thrown on a credit card to be paid off over the next few years.