How do 40 year olds decide what they can afford?

miamivice · Post by **miamivice** » Tue Apr 09, 2019 7:43 pm

As I approach age 40, I think that I need a new way of determining what extras (i.e., toys) can I afford.

In my teens, it was easy. I saved half, and I spent half. Since my expenses were zero, I spent 1/2 on whatever I wanted.

In my twenties, it was easy. I didn't have disposable income for the most part. Everything went to recurring bills or retirement savings. There wasn't much left after that.

My thirties were easy too. In our early thirties, my wife and I were dual income no kid, and made a ton. I bought anything I wanted, saved a huge amount toward retirement, and had extra left over for taxable.

Now in my forties, it's hard. I have a large amount of savings, which I would rather not tap. Most of my extra income is going to make extra payments on a second mortgage. Likely, we will have more than enough in retirement. Part of me feels spend today, part of me feels that toys get used for a while and then go by the wayside.

How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

By toys, I mean RVs, boats, drones, bikes, cars (above and beyond basic transportation), phones (above and beyond what is necessary for daily life), etc. Anything that is sort of pricey as well as not necessary.

JD2775 · Post by **JD2775** » Tue Apr 09, 2019 7:47 pm

I am in a different boat than you are.... I didn't save in my 20's and barely saved in my early/mid 30's, and certainly didn't save in my teens. It was only in my late 30's that I woke up and began saving in earnest. As I have gotten older (44 now) I find I question purchasing things much much more than I used to, even though I can afford them much easier than years past. Especially with larger purchases, or new clothes etc. I have gotten more financially conservative all the way around in my 40's

fortfun · Post by **fortfun** » Tue Apr 09, 2019 7:52 pm

We are in our mid 40s and the only extra that we spend a significant amount of money on is travel. These travel experiences, with our kids, are priceless. I hope it is helping shape the adults they will become. An old canoe is our boat and a 6 person tent is our RV. I buy used bikes whenever I can but splurged on a Surly Long Haul Trucker a few years ago.

White Coat Investor · Post by **White Coat Investor** » Tue Apr 09, 2019 7:58 pm

Save enough to reach your goals spend the rest.

28fe6 · Post by **28fe6** » Tue Apr 09, 2019 7:59 pm

As I get older I want less and less to buy or own things. Most of the toys I bought in the past I have either moved on from, or I regret. Every now and then I think I want a nice motorcycle or something, but then I realize after a while it would be just one more thing to maintain and insure.

stlutz · Post by **stlutz** » Tue Apr 09, 2019 7:59 pm

Spend what you want on bikes but not anything else.

gmc4h232 · Post by **gmc4h232** » Tue Apr 09, 2019 8:02 pm

you can buy whatever you want as long as you can sell it for more than you paid for it when the novelty wears off. You'll find that the hunt for the best deal will be much more fun that the actual purchase and ownership. The selling of the item and profiting is also more fun.

Snowjob · Post by **Snowjob** » Tue Apr 09, 2019 8:03 pm

I'm only a couple years behind you and what helps me is discount my targeted retirement number by a reasonable rate of return to see if my savings is on target. For example if i want 1M a retirement, and the present value of that is 600k using a 3.5% real return, I'll compare that present value of 600k to what my current retirement portfolio is. If I'm at or above that level great -- in theory everything I save is gravy, if I'm below that level, I need to make sure I'm saving enough over the next X years to help close the gap. Knowing where you are to you target will let inform you of how much of your paycheck is truly discretionary.

aspirit · Post by **aspirit** » Tue Apr 09, 2019 8:08 pm

28fe6 wrote: ↑
Tue Apr 09, 2019 7:59 pm
As I get older I want less and less to buy or own things. Most of the toys I bought in the past I have either moved on from, or I regret. Every now and then I think I want a nice motorcycle or something, but then I realize after a while it would be just one more thing to maintain and insure.

This...x100T..

Most times renting ones urges works just enough

telecaster · Post by **telecaster** » Tue Apr 09, 2019 8:20 pm

The older I get the less I seem to want "stuff".
At this point I can pretty much afford whatever I want, but I don't really want much.

To be fair, I did have an issue purchasing vintage guitar and bass tube amplifiers. I corrected it by starting a side gig repairing them for others.
Now I get to play with and work on other peoples all the time. I stopped buying them and now make money messing with them

GCD · Post by **GCD** » Tue Apr 09, 2019 8:20 pm

My wife and I kept separate finances during the first 6 months of marriage. Then we just decided that was silly and went all in. But one of the side effects of combining all our finances was I felt reluctant to splurge on toys with "our" money. It was just a mental block. I found it nearly impossible to spend on anything that wasn't a need.

What we worked out was that I got a $100 per week "allowance" that included coffee and lunches. Anything I saved up for I could buy and not feel like I was frivolously spending "our" money. It also had the benefit that I was motivated to be frugal on the lunches and coffee so I could build up my toy money quicker.

Just work out your "allowance" to be whatever it is within your budget. Then spend it freely. Obviously it's just a psychological game. If you are in your 40s and in financially sound shape then it's not like you have a spendthrift mindset.

MotoTrojan · Post by **MotoTrojan** » Tue Apr 09, 2019 8:21 pm

Snowjob wrote: ↑
Tue Apr 09, 2019 8:03 pm
I'm only a couple years behind you and what helps me is discount my targeted retirement number by a reasonable rate of return to see if my savings is on target. For example if i want 1M a retirement, and the present value of that is 600k using a 3.5% real return, I'll compare that present value of 600k to what my current retirement portfolio is. If I'm at or above that level great -- in theory everything I save is gravy, if I'm below that level, I need to make sure I'm saving enough over the next X years to help close the gap. Knowing where you are to you target will let inform you of how much of your paycheck is truly discretionary.

How do you value extra years working though?

Snowjob · Post by **Snowjob** » Tue Apr 09, 2019 8:43 pm

MotoTrojan wrote: ↑
Tue Apr 09, 2019 8:21 pm

Snowjob wrote: ↑
Tue Apr 09, 2019 8:03 pm
I'm only a couple years behind you and what helps me is discount my targeted retirement number by a reasonable rate of return to see if my savings is on target. For example if i want 1M a retirement, and the present value of that is 600k using a 3.5% real return, I'll compare that present value of 600k to what my current retirement portfolio is. If I'm at or above that level great -- in theory everything I save is gravy, if I'm below that level, I need to make sure I'm saving enough over the next X years to help close the gap. Knowing where you are to you target will let inform you of how much of your paycheck is truly discretionary.
How do you value extra years working though?

That question is very personal -- if we are only talking a smaller amount of discretionary income, 4 or 5 thousand dollars, that extra spending might increase your quality of life and saving it wont shave much time off your final retirement date. However if we are talking 30 or 40 thousand dollars, then its quite possible you might not find a good way to spend it all and you might as well save the majority.

In my situation, I'm targeting retirement in my early 50's and while I am on track to hit that, my ability to save much more than I already am is not great (more like the 4 or 5 thousand example) In this case, I'd much rather have a better quality of life for the next 15 years than try and shave off 6 months or a year moving up my retirement say from age 51 to age 50. Ideally once you get a comfortable with your trajectory you should be focusing on consumption smoothing. To me a better quality of life for the next 15 years is better than an extra 6-9 months of retirement 15 years from now. One thing that I cant understand is how many some people put off vacations because its "not in the budget" yet they are saving a good amount for retirement. I think they will regret not taking that time when they were young.

DonIce · Post by **DonIce** » Tue Apr 09, 2019 8:47 pm

Get the things you really want, save the rest. If you're on the fence about something, wait a month. If you still want it after a month, get it then. Chances are most of the time you won't still want it.

TheMajorH2 · Post by **TheMajorH2** » Tue Apr 09, 2019 9:03 pm

I am approaching the same age and just went through the same thing. I figured out a comfortable amount to spend on discretionary based on what I want my life in retirement to look like, what I needed to save to get there and how long I would likely need it.

First I figured out how long I need the retirement money to last and based on family history and my love of pall malls in my youth I figure I would be lucky if I made 83, so with a retirement age of 62, I need my money to last about 21 years. Then I thought about expenses in retirement compared to now and how I wanted to set my daughter up, like 529 funding and such. Ran a few Monte Carlos on the numbers and figured out at 5% annually what I would need to save today to reach that goal. Now that I have a savings number, I have allowed myself to spend what’s left on whatever I want.

Triple digit golfer · Post by **Triple digit golfer** » Tue Apr 09, 2019 9:14 pm

DonIce wrote: ↑
Tue Apr 09, 2019 8:47 pm
If you're on the fence about something, wait a month. If you still want it after a month, get it then. Chances are most of the time you won't still want it.

I couldn't agree with this more. I wanted a new lawn mower last fall. I decided to wait until spring to see if I still wanted it. I didn't. I'm happy with the old one and a new $12 blade.

I think with Bogleheads, we often get more joy out of saving money than whatever joy a new toy or material item would bring. Just can't let it become obsessive.

fortfun · Post by **fortfun** » Tue Apr 09, 2019 10:31 pm

One other factor is early retirement considerations. We are planning to retire at 51 & 52. This is another reason I spend less on "stuff" now. I want to do some travelling while we are still healthy enough to really enjoy it.

bluebolt · Post by **bluebolt** » Tue Apr 09, 2019 10:50 pm

"Nothing tastes as good as skinny feels" - Kate Moss

"No spending is as satisfying as FIRE feels" - me

sailaway · Post by **sailaway** » Tue Apr 09, 2019 10:59 pm

For the big stuff, we do a careful analysis of how it will change our spending going forward and discuss pros and cons.

Last year saw nearly a 50% increase over previous years, but it was what we decided was necessary for our peace of mind. Next year, we plan to spend more than usual on vacations in order to spend more time with our parents, who will be turning 75.

malabargold · Post by **malabargold** » Wed Apr 10, 2019 6:31 am

You’ll probably find that stuff only brings momentary
happiness, and if you buy things too grandiose you become
the thing possessed.
Consider refocusing financial goals to assist others or causes
beyond yourself

smitcat · Post by **smitcat** » Wed Apr 10, 2019 6:37 am

"How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?"

We had a base minimum savings budget from our 30's that we filled no matter what.
Above that level when we earned more money we split the 'extra' after taxes between savings and spending as a rule.
Although there were years when we really just split it in half most years we ended up saving more than spending the increases
That worked well into our 50's which kept us on track with savings and also allowed us to greatly enjoy the present along the way.

RickBoglehead · Post by **RickBoglehead** » Wed Apr 10, 2019 7:00 am

"How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?"

I guess I'm perplexed at why the OP thinks that people in their 40's make spending decisions differently than those in their 30's. I think the problem is that the OP states that in his 30's "I bought anything I wanted".

Just because you have enough money to retire, or more than enough to retire, should you "buy anything you want"? To me, that shows a lack of restraint and maturity (not commenting on OP's maturity, merely saying that when I see someone with jet skis, motorcycles, RV, extra cars, drones, etc. the first thing that goes through my head is that the person is either very young or lacks maturity. I had a neighbor like that, his excuse was that these were his children. He had several drones, a recumbent bike, many sports cars, ... Each lasted a year or less and on to the next thing because he was bored.

For those that work a 60 hour a week job, and have kids that participate in activities, I have never seen how family life didn't suffer with tons of toys. Most importantly, the value system of the children being raised. Teaching restraint, teaching that money doesn't buy happiness, and teaching that things shouldn't be given to you, they should be earned, is important for children.

Did we spend less during our 30s, 40s, and 50s? Absolutely. From 2008 - 2017 I paid for every vacation with hotel points accumulated mostly during 2007 when I accumulated nearly 1 million points because a major hotel chain gave points for buying and selling a home. Every vacation had to be at a hotel that was in this chain. It was tough, we had to "suffer" skiing at Whistler, or the many areas in Utah driving from Salt Lake City each day. We went to Hawaii on airline points and hotel points. No $25 pp continental breakfast each day, we made coffee in room and used our frig and microwave to make breakfast. Ate a great Subway sub before snorkeling off many beaches. Went out for dinner to local spots and didn't spend $300 a night.

As we approach retirement, we'll shift into a spend mode, but still likely under-spend as many here do. Do I want "toys"? Sure. Will I have some? Yes. But I will show the same restraint that I have my entire life.

The OP notes that "toys go by the wayside". They do. Don't buy them.

livesoft · Post by **livesoft** » Wed Apr 10, 2019 7:08 am

How do you decide what you can spend your time on? Spending money is kind of secondary.

veindoc · Post by **veindoc** » Wed Apr 10, 2019 7:34 am

In my 40s, I am allowing myself more leeway with regards to my wants as our net worth is now approaching FI. I put everything in auto save and spend the rest so with regard to items that I can pay with cash flow that is not usually a problem. The thing I still struggle with are the large expenditures that would require taking money from savings. Things like a new car, fun home projects like the patio and outdoor kitchen I been drooling over, and upping the vacation budget.

I hope this reluctance to draw from savings will not persist into retirement. That would make for a very boring retirement.

onourway · Post by **onourway** » Wed Apr 10, 2019 8:08 am

We run a tight zero-based budget where nearly everything extra is put into savings with a small amount of flexible spend money. Like many others here, I've found as I've reached 40 that I have much less tolerance for things. They take up space, sap mental and physical energy, and are much easier to bring into ones space than to get rid of. So, to the extent possible with 3 young kids, I try to be extremely conscientious about new stuff that is brought into the house. Keeping the budget artificially tight helps this substantially. However, we save so much that if we really want something, we buy it - right up to and including a new car when I suddenly decided last year that I this period of my life was no longer a good fit for my car enthusiast habit, and I needed the reliability and simplicity of something newer. However the fact that we have to remove that money from our savings and reconcile that in our budget adds just enough of a barrier to the process that we mostly choose to save more rather than buy more.

Grt2bOutdoors · Post by **Grt2bOutdoors** » Wed Apr 10, 2019 8:15 am

Do I need it? Yes - buy it. No. Proceed to next question --> How bad do I want it? Do I want it bad enough to delay retirement X months/years? Do I want it bad enough to leave less or nothing for something else?

SRenaeP · Post by **SRenaeP** » Wed Apr 10, 2019 8:30 am

DH and I use the following -

Will you actually use it on a regular basis?
Is buying it the best option vs renting or borrowing?
Are we meeting our (admittedly lofty) saving/investing goals?
Do we have the cash to buy it outright (and yes, that includes cars)?
If so, go forth and prosper.

caffeperfavore · Post by **caffeperfavore** » Wed Apr 10, 2019 8:41 am

aspirit wrote: ↑
Tue Apr 09, 2019 8:08 pm

28fe6 wrote: ↑
Tue Apr 09, 2019 7:59 pm
As I get older I want less and less to buy or own things. Most of the toys I bought in the past I have either moved on from, or I regret. Every now and then I think I want a nice motorcycle or something, but then I realize after a while it would be just one more thing to maintain and insure.
This...x100T..

Most times renting ones urges works just enough

Ditto. My desire for things has decreased with my ability to purchase them. I've learned that the thrill of buying the latest and greatest thing is short-lived and adds nothing to the quality of my life. I have no idea what the latest smartphone or TV or car or whatever is and I don't care. There's freedom in unplugging from that stuff.

Instead, I've found that doing things makes me happy, whether its making art, gardening, traveling, spending time with friends, or riding my bike (which is an old steel frame dinosaur, yet I think it's much cooler than the latest carbon thing anyway).

caffeperfavore · Post by **caffeperfavore** » Wed Apr 10, 2019 9:18 am

aspirit wrote: ↑
Tue Apr 09, 2019 8:08 pm

28fe6 wrote: ↑
Tue Apr 09, 2019 7:59 pm
As I get older I want less and less to buy or own things. Most of the toys I bought in the past I have either moved on from, or I regret. Every now and then I think I want a nice motorcycle or something, but then I realize after a while it would be just one more thing to maintain and insure.
This...x100T..

Most times renting ones urges works just enough

Ditto. My desire for things has decreased with my ability to purchase them. I've learned that the thrill of buying the latest and greatest thing is short-lived and adds nothing to the quality of my life. I have no idea what the latest smartphone or TV or car or whatever is and I don't care. There's freedom in unplugging from that stuff.

Instead, I've found that doing things makes me happy, whether its art, gardening, traveling, spending time with friends, or riding my bike (which is an old steel frame dinosaur, yet I think it's much cooler than the latest carbon thing anyway).

So, how do I decide? I guess I don't because I don't really buy toys anymore. I just buy things that add value to my life. It turns out that I don't need many things for that.

msk · Post by **msk** » Wed Apr 10, 2019 9:50 am

This worked for me. I am now at mid 70s, retired since age 55.
Save and invest 30% of after tax income, from the day you graduate till the day you retire. In your younger days your income was mainly job income. After 20 years of saving and investing you ought to have a substantial amount of non job related income; be it from rental RE, stocks, whatever. Hence saving and investing the 30% becomes much easier, not more difficult. The rest you can spend guilt free on anything. At around age 40 I bought myself the top of the line Mercedes Coupe... Corollary "rules" I followed:

A home should not cost more than 3x annual income (2.5x combined income). Paying off principal on a home mortgage counts as investing, not the interest portion
A car(s) should not cost more than 6 months income

Frankly, because I started off saving and investing 30% very early, by the time I was in my 40s I was saving and investing quite a lot more than 30%, but you might not have been so lucky with your investments. Nevertheless do not let savings drop below 30% and blow the rest on anything

BanquetBeer · Post by **BanquetBeer** » Wed Apr 10, 2019 9:55 am

Where everyone seems to be going with this is evaluate why you want to purchase something and really consider if that purchase will add long term value to your life.

You should have a plan to carry you through to retirement that breaks out some savings amount. The rest can be spent. How you prioritize that spending is up to you and your personal preferences but per above, consider the long term vs short term draw of the purchase.

Dottie57 · Post by **Dottie57** » Wed Apr 10, 2019 10:05 am

DonIce wrote: ↑
Tue Apr 09, 2019 8:47 pm
Get the things you really want, save the rest. If you're on the fence about something, wait a month. If you still want it after a month, get it then. Chances are most of the time you won't still want it.

Same thing for me. No impulse purchases over a certain amount $10- $25 depending on type of item. It works quite well.

finfire · Post by **finfire** » Wed Apr 10, 2019 10:15 am

I found a way of buying many of the kid's (and mine) toys locally at closeout prices. It does require patience for the item to become available though.

As the items get obsolete/ignored, I'll re-sell them closer to purchase price, vastly reducing the cost to "rent" these things for a couple of years.

I've always gone with the rule to walk away from impulse purchases and re-evaluate the need. If I still want the item after a few months, I'll generally buy it and not regret it. Some "toys" do make life fun.

bloom2708 · Post by **bloom2708** » Wed Apr 10, 2019 10:18 am

I don't want any "big stuff".

Anything under $50 I just buy. As mentioned, save enough, spend the rest.

It sounds like you have at least 2 mortgages. Maybe in your 40s it is time to pay off your debts and take a go at being debt free.

I know debt is a tool. Just not a fun tool.

dcabler · Post by **dcabler** » Wed Apr 10, 2019 11:25 am

miamivice wrote: ↑
Tue Apr 09, 2019 7:43 pm
As I approach age 40, I think that I need a new way of determining what extras (i.e., toys) can I afford.

In my teens, it was easy. I saved half, and I spent half. Since my expenses were zero, I spent 1/2 on whatever I wanted.

In my twenties, it was easy. I didn't have disposable income for the most part. Everything went to recurring bills or retirement savings. There wasn't much left after that.

My thirties were easy too. In our early thirties, my wife and I were dual income no kid, and made a ton. I bought anything I wanted, saved a huge amount toward retirement, and had extra left over for taxable.

Now in my forties, it's hard. I have a large amount of savings, which I would rather not tap. Most of my extra income is going to make extra payments on a second mortgage. Likely, we will have more than enough in retirement. Part of me feels spend today, part of me feels that toys get used for a while and then go by the wayside.

How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

By toys, I mean RVs, boats, drones, bikes, cars (above and beyond basic transportation), phones (above and beyond what is necessary for daily life), etc. Anything that is sort of pricey as well as not necessary.

Been there, done that. In my 40's my wife and I were also both working. We ultimately decided to live off of one salary and save the other. Did we buy toys? yep. Did the novelty wear off? yep. Did we have to find a way to get rid of those things after the novelty wore off? Indeed. We were fortunate to spend a couple of years in Europe on an expat assignment. Most of the friends we made there were much more interested in "doing", rather than "having". When we returned, we took that to heart. We're still getting rid of "stuff" and we try to spend more of our money "doing" - interesting vacations, restaurants, museums, and the like. As they say, memories last a lifetime....

Cheers!

Time2Quit · Post by **Time2Quit** » Wed Apr 10, 2019 11:43 am

Take this from someone in their 40's that thought they needed all the "toys" (stuff) since I could easily afford it. These toys bring short term enjoyment and become a burden to maintain. Just because you can afford to buy something does not mean you need to.

I agree with and also practice what other posters have said: spend your money on experiences with the family and you wont regret it.

I guess everyone has to come to their own conclusion on what makes them happy.

Ron Ronnerson · Post by **Ron Ronnerson** » Wed Apr 10, 2019 11:49 am

My wife and I are both 44 and have found that time is the most precious thing to us so we’re purchasing large amounts of it by not working too much. This allows us to spend a lot of time together as a family (I’m a teacher, my wife is a stay-at-home parent, and we have a four-year-old). If we really want something, we consider it carefully and try to find the most affordable way to purchase it.

FIBoston · Post by **FIBoston** » Wed Apr 10, 2019 11:51 am

Set goals, then set savings parameters to hit those goals, then pay bills, then give a little back, then spend however you want.

hoops777 · Post by **hoops777** » Wed Apr 10, 2019 11:56 am

Forty year olds are individuals that differ from one another so it depends on you,not someone else.

H-Town · Post by **H-Town** » Wed Apr 10, 2019 12:07 pm

miamivice wrote: ↑
Tue Apr 09, 2019 7:43 pm
As I approach age 40, I think that I need a new way of determining what extras (i.e., toys) can I afford.

In my teens, it was easy. I saved half, and I spent half. Since my expenses were zero, I spent 1/2 on whatever I wanted.

In my twenties, it was easy. I didn't have disposable income for the most part. Everything went to recurring bills or retirement savings. There wasn't much left after that.

My thirties were easy too. In our early thirties, my wife and I were dual income no kid, and made a ton. I bought anything I wanted, saved a huge amount toward retirement, and had extra left over for taxable.

Now in my forties, it's hard. I have a large amount of savings, which I would rather not tap. Most of my extra income is going to make extra payments on a second mortgage. Likely, we will have more than enough in retirement. Part of me feels spend today, part of me feels that toys get used for a while and then go by the wayside.

How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

By toys, I mean RVs, boats, drones, bikes, cars (above and beyond basic transportation), phones (above and beyond what is necessary for daily life), etc. Anything that is sort of pricey as well as not necessary.

Only you can give yourself conviction for what you do. I spend whatever I want, whenever I want it. It just happens that I save way more than I spend. No regrets.

aristotelian · Post by **aristotelian** » Wed Apr 10, 2019 12:10 pm

The way I would put it is that the question changes. It's no longer whether you can afford it but whether it is worth it. I can afford pretty much anything within reason, but in.most cases I'd rather work less or give more to kids and charity.

stocknoob4111 · Post by **stocknoob4111** » Wed Apr 10, 2019 12:40 pm

miamivice wrote: ↑
Tue Apr 09, 2019 7:43 pm
How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

I establish my financial goals and how much of my savings I need to contribute consistently to get there. Then I see what I need for essential living. The rest is discretionary. For me that's a good amount I spend yearly on travel and about 2 years ago I acquired a modest car payment (it's at zero percent and also got $1000 back just for taking the loan and I invested what I would've paid otherwise I dislike any debt).

However, the older I get the less I get satisfaction from "gadgets" or toys. I did some of that in my late 20s, 30s.. but now I am just disinterested, I focus more on experiences like traveling. I am actually earning more but spending less than I did in my 30s. I just save a lot more of my income.

runner540 · Post by **runner540** » Wed Apr 10, 2019 1:10 pm

Miamivice, a few weeks ago you started a thread about how to payoff your HELOC because cash flow was too tight. viewtopic.php?f=2&t=275981&p=4440531#top

Have you resolved your cash flow and debt issues? Until then, you can't afford toys...

Fallible · Post by **Fallible** » Wed Apr 10, 2019 1:20 pm

miamivice wrote: ↑
Tue Apr 09, 2019 7:43 pm
...
How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

By toys, I mean RVs, boats, drones, bikes, cars (above and beyond basic transportation), phones (above and beyond what is necessary for daily life), etc. Anything that is sort of pricey as well as not necessary.

It seems you need to decide what IS necessary, what you are truly interested in and that can provide experiences that are fulfilling, lasting, and bring fun memories. Then decide whether they are too pricey or see if there is a way to keep costs down.

What interests do you have?

JBTX · Post by **JBTX** » Wed Apr 10, 2019 1:21 pm

One thing to determine is not only how much does the toy cost upfront, but also the recurring impact it has on annual expenses, and is this toy/hobby likely something you will carry into retirement.

So let's say you project to have 30x expenses at retirement. But now you've added a boat and an RV, both will have substantial recurring and maybe replacement costs. It impacts both the numerator (savings is less due to purchase) and the denominator (higher recurring retirement expenses). Your 30x may now be 25x. Obviously it is an iterative calculation. The more toys, the less savings you have, the more the recurring expenses, the more you need to save, the less you have to spend on toys.

Thegame14 · Post by **Thegame14** » Wed Apr 10, 2019 1:32 pm

miamivice wrote: ↑
Tue Apr 09, 2019 7:43 pm
As I approach age 40, I think that I need a new way of determining what extras (i.e., toys) can I afford.

In my teens, it was easy. I saved half, and I spent half. Since my expenses were zero, I spent 1/2 on whatever I wanted.

In my twenties, it was easy. I didn't have disposable income for the most part. Everything went to recurring bills or retirement savings. There wasn't much left after that.

My thirties were easy too. In our early thirties, my wife and I were dual income no kid, and made a ton. I bought anything I wanted, saved a huge amount toward retirement, and had extra left over for taxable.

Now in my forties, it's hard. I have a large amount of savings, which I would rather not tap. Most of my extra income is going to make extra payments on a second mortgage. Likely, we will have more than enough in retirement. Part of me feels spend today, part of me feels that toys get used for a while and then go by the wayside.

How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

By toys, I mean RVs, boats, drones, bikes, cars (above and beyond basic transportation), phones (above and beyond what is necessary for daily life), etc. Anything that is sort of pricey as well as not necessary.

Have kids, there wont be any money left over for yourself, problem solved....

Admiral · Post by **Admiral** » Wed Apr 10, 2019 1:48 pm

miamivice wrote: ↑
Tue Apr 09, 2019 7:43 pm
As I approach age 40, I think that I need a new way of determining what extras (i.e., toys) can I afford.

In my teens, it was easy. I saved half, and I spent half. Since my expenses were zero, I spent 1/2 on whatever I wanted.

In my twenties, it was easy. I didn't have disposable income for the most part. Everything went to recurring bills or retirement savings. There wasn't much left after that.

My thirties were easy too. In our early thirties, my wife and I were dual income no kid, and made a ton. I bought anything I wanted, saved a huge amount toward retirement, and had extra left over for taxable.

Now in my forties, it's hard. I have a large amount of savings, which I would rather not tap. Most of my extra income is going to make extra payments on a second mortgage. Likely, we will have more than enough in retirement. Part of me feels spend today, part of me feels that toys get used for a while and then go by the wayside.

How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

By toys, I mean RVs, boats, drones, bikes, cars (above and beyond basic transportation), phones (above and beyond what is necessary for daily life), etc. Anything that is sort of pricey as well as not necessary.

Well you already have two mortgages, doesn't that count? I think you can make a distinction between a drone (1.5k) and a boat (30 times that) and an RV (whatever those cost). If you can pay for it with cashflow and no debt, and are saving enough, then buy what brings you joy. But just keep in mind that almost all studies show paying for experiences and not more "stuff" brings the most happiness. The drone will break, and so will the boat.

smitcat · Post by **smitcat** » Wed Apr 10, 2019 2:28 pm

Admiral wrote: ↑
Wed Apr 10, 2019 1:48 pm

miamivice wrote: ↑
Tue Apr 09, 2019 7:43 pm
As I approach age 40, I think that I need a new way of determining what extras (i.e., toys) can I afford.

In my teens, it was easy. I saved half, and I spent half. Since my expenses were zero, I spent 1/2 on whatever I wanted.

In my twenties, it was easy. I didn't have disposable income for the most part. Everything went to recurring bills or retirement savings. There wasn't much left after that.

My thirties were easy too. In our early thirties, my wife and I were dual income no kid, and made a ton. I bought anything I wanted, saved a huge amount toward retirement, and had extra left over for taxable.

Now in my forties, it's hard. I have a large amount of savings, which I would rather not tap. Most of my extra income is going to make extra payments on a second mortgage. Likely, we will have more than enough in retirement. Part of me feels spend today, part of me feels that toys get used for a while and then go by the wayside.

How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

By toys, I mean RVs, boats, drones, bikes, cars (above and beyond basic transportation), phones (above and beyond what is necessary for daily life), etc. Anything that is sort of pricey as well as not necessary.
Well you already have two mortgages, doesn't that count? I think you can make a distinction between a drone (1.5k) and a boat (30 times that) and an RV (whatever those cost). If you can pay for it with cashflow and no debt, and are saving enough, then buy what brings you joy. But just keep in mind that almost all studies show paying for experiences and not more "stuff" brings the most happiness. The drone will break, and so will the boat.

"The drone will break, and so will the boat."
Our boat(s) brought us a huge amount of experiences and memories - everything breaks , just want to make sure you like whatever you do.

kaudrey · Post by **kaudrey** » Wed Apr 10, 2019 2:32 pm

Well, instead of focusing on your desire to buy "things", I'll answer your broader question.

We decide the same way we always did - 1) are we meeting our savings goals? If yes, then 2) will this give us long-term enjoyment? if yes, fine. If not, nope.

It doesn't matter if it is a gadget or toy or a trip or an expensive dinner out. The question of how you spend your money is up to you - if you are meeting your savings goals, whatever they are, then do what will make you happy with the rest.

We don't buy many gadgets, but we spend plenty on traveling and eating out at nice restaurants. (Of course, we wouldn't be able to travel and eat out at nice restaurants if we spent all of our money on gadgets!).

Admiral · Post by **Admiral** » Wed Apr 10, 2019 2:42 pm

smitcat wrote: ↑
Wed Apr 10, 2019 2:28 pm

Admiral wrote: ↑
Wed Apr 10, 2019 1:48 pm

miamivice wrote: ↑
Tue Apr 09, 2019 7:43 pm
As I approach age 40, I think that I need a new way of determining what extras (i.e., toys) can I afford.

In my teens, it was easy. I saved half, and I spent half. Since my expenses were zero, I spent 1/2 on whatever I wanted.

In my twenties, it was easy. I didn't have disposable income for the most part. Everything went to recurring bills or retirement savings. There wasn't much left after that.

My thirties were easy too. In our early thirties, my wife and I were dual income no kid, and made a ton. I bought anything I wanted, saved a huge amount toward retirement, and had extra left over for taxable.

Now in my forties, it's hard. I have a large amount of savings, which I would rather not tap. Most of my extra income is going to make extra payments on a second mortgage. Likely, we will have more than enough in retirement. Part of me feels spend today, part of me feels that toys get used for a while and then go by the wayside.

How do others in their 40's make decisions about what they can afford with regards to "toys", gadgets, and other fun but unnecessary things?

By toys, I mean RVs, boats, drones, bikes, cars (above and beyond basic transportation), phones (above and beyond what is necessary for daily life), etc. Anything that is sort of pricey as well as not necessary.
Well you already have two mortgages, doesn't that count? I think you can make a distinction between a drone (1.5k) and a boat (30 times that) and an RV (whatever those cost). If you can pay for it with cashflow and no debt, and are saving enough, then buy what brings you joy. But just keep in mind that almost all studies show paying for experiences and not more "stuff" brings the most happiness. The drone will break, and so will the boat.
"The drone will break, and so will the boat."
Our boat(s) brought us a huge amount of experiences and memories - everything breaks , just want to make sure you like whatever you do.

I'm sure it/they did. The point is stuff breaks, and then costs money to fix (or replace). If one has the money to fix/replace, then that seems like a fine personal choice. Not everything breaks. Travel and vacations don't. Doesn't mean that don't cost money, they are just not ongoing expenses (unless one continues to purchase them). Buying a car and walking are both means of transportation. One costs more. Unless the other required hip replacement