How much do you splurge

[duyen]

I have always been cheap. Naturally I enjoy to limit my spending and see my networth grow. As mostly a single income family (2 kids), I was able to reach 1.2m. I am still working and make about 280k

I have no doubts that I will reach to financial safety and freedom in a few years; whatever that number might be. We won't starve.

At this point, I wonder how can I stop being so cheap. I am sure many of you have faced this conundrum. It is our frugality that helps our FI but again we need to relax it a bit to start enjoying life more. How do you decide how much to set aside for splurging and what are some things you splurge on

[Zikoris]

I actually disagree with the entire concept of "splurging", "treating yourself", etc. I think if there are things that make you happier and make your life better, they deserve way more than that - you should build your ENTIRE LIFE around those things, not "splurge" on them. If you do that and also be absolutely ruthless about axing anything that doesn't make you happier or improve your life, man, you get to live one hell of a life doing everything you love most all the time, and also saving piles of money.

Travelling is one of those things for me. We spend a ridiculous amount of our (solidly average) income going to five or six countries a year and having some wild adventures. Neither of us gives a shit about cars or restaurants or many other things, so that all gets axed.

The end result is really good. You get to retire in your 30s while also not sacrificing or suffering at all, without needing to earn a high income or work hard, and you get to do all the fun stuff you want along the way, only to retire and ramp up the fun stuff even more.

[Dicey]

I'm more in Zikoris' camp.

When I go grocery shopping, which is the only kind of shopping I'm doing these days, I buy whatever I want, while trying to avoid wretched excess. The trick is that I don't shop at fancy-ass grocery stores. Costco (with a list), Grocery Outlet, and the 99 Cents only stores are my go-tos.

A couple of weeks ago, I got a deal on some cute Sabra hummus/pretzel packs for DH's lunches at GO. They were 10/$1.00. I bought ten. The following week they had a different flavor that they'd overlooked in the back cooler on sale 20/$1.00. I bought 20. Later, the original flavor was back at 10/$1.00, and I bought ten more. That sounds wretchedly extravagant, but I pack DH's lunch every single day. He likes them and they will get used up. We both scoff at expiration dates.

Yesterday, I bought four huge salami at Costco to send to an out-of-state relative. There was still room at the ends of the "If it fits, it ships" box. I was looking for something to top it off that wouldn't be crushed by the salami or melt or spill. I wanted to mail it right away, and there is a Trader Joe's between Costco and the Post Office, so I stopped in, seeking inspiration. Haven't been in a TJ's in months (too expensive, IMO). I was really just poking around to find something for the box. WOW! I discovered they now carry shelf stable whipping cream and it's only $1.99! We love impromptu whipped cream on our deserts now and then. Amazeballs! I bought FOUR of them, yippee!

I didn't find anything to fit the frugal price-to-bulk + shipping durability I was seeking. I reluctantly headed away from the Post Office to the 99 Cent Only Store (fully masked and gloved at every stop). I found 1lb. bags of Jolly Rancher Jelly Beans and six bags filled the space perfectly. Six bucks well spent. I am being reimbursed for this, so it's really just about playing the game well, which I find very entertaining. The large, flat rate box cost $21.20 to ship and I got 19.2 pounds of stuff into it, for the win!

What a ridiculously extravagant life I lead!

FWIW, I'm FIRE and I have no splurge budget. In fact, I have no budget at all.

Here's a sidebar story that occurred during yesterday's shopping. Something rather not good happened to a friend last night. She's fine, but what happened was covered on multiple news outlets. While I was at Costco, I bought a $9.99 bouquet for her. I chose Alstroemeria. I don't buy cut flowers often, but these sweet Peruvian Lilies are very long lasting, so more bang for your buck, right mustachians? Except, at Trader Joe's, I saw adorable miniature potted red roses for $5.99. I liked the idea of giving her something living, so I bought that for her and kept the lilies for our house. Wait! I spent an unplanned $15.98? No big deal and plenty of fresh flower sweetness to go around. Oh, and $7.96 on the whipping cream. Good thing I don't have a budget.

I also avoid shopping on the internet and I don't let my inbox get cluttered up with any kind of recurring subscription or "deal" offers. It really helps.

[ixtap]

What spending do you think would help you enjoy life more?

We never look at the money we have and decide to splurge. We look at the things/ experiences we want and decide how they fit with our overall goals.

For example, we have a wonderful boat, which most people consider quite the splurge. However, we lived on the boat for several years, saving enough in housing to pay for the boat itself.

[wenchsenior]

I actually disagree with the entire concept of "splurging", "treating yourself", etc. I think if there are things that make you happier and make your life better, they deserve way more than that - you should build your ENTIRE LIFE around those things, not "splurge" on them. If you do that and also be absolutely ruthless about axing anything that doesn't make you happier or improve your life, man, you get to live one hell of a life doing everything you love most all the time, and also saving piles of money.

Travelling is one of those things for me. We spend a ridiculous amount of our (solidly average) income going to five or six countries a year and having some wild adventures. Neither of us gives a shit about cars or restaurants or many other things, so that all gets axed.

The end result is really good. You get to retire in your 30s while also not sacrificing or suffering at all, without needing to earn a high income or work hard, and you get to do all the fun stuff you want along the way, only to retire and ramp up the fun stuff even more.

Generally agree with this.  We try to align our spending with the things we value most and that bring us the most satisfaction.  I have rarely regretted spending in certain categories (traveling), and often regretted dollars spent on e.g., clothes (in my younger days, not recently).  When we ate out at restaurants frequently in our 20s, in retrospect I don't feel we got the appropriate value per dollar for that behavior. So now, we rarely eat out, and we enjoy it more when we do.  Many people on this thread really value keeping their grocery bill down, but to do so might require a lot more time bulk cooking.  I love good food, but really dislike cooking (though I'm ok at it) and wish to do as little cooking as possible while still eating healthfully and not eating a lot of processed foods.  That requires more $.  Groceries/consumables trades off with our mortgage+insurance as our biggest bill, depending on the month. After several years trying different ways to really slash our food bill, I decided it simply was not worth it to me in the additional time and effort spent food planning, shopping at different stores, and bulk cooking.  Etc.

Try to maximize your value per dollar spent and you feel pretty rich, even if you aren't spending all that much.

[nereo]

Just dropping these here.  Worth a read OP

https://www.mrmoneymustache.com/2014/11/23/not-extreme-frugality/

[Mike in NH]

I actually disagree with the entire concept of "splurging", "treating yourself", etc. I think if there are things that make you happier and make your life better, they deserve way more than that - you should build your ENTIRE LIFE around those things, not "splurge" on them. If you do that and also be absolutely ruthless about axing anything that doesn't make you happier or improve your life, man, you get to live one hell of a life doing everything you love most all the time, and also saving piles of money.

Travelling is one of those things for me. We spend a ridiculous amount of our (solidly average) income going to five or six countries a year and having some wild adventures. Neither of us gives a shit about cars or restaurants or many other things, so that all gets axed.

The end result is really good. You get to retire in your 30s while also not sacrificing or suffering at all, without needing to earn a high income or work hard, and you get to do all the fun stuff you want along the way, only to retire and ramp up the fun stuff even more.

100%. Cars? Meh. Clothes? Meh. Eating out? Meh. Cell phones? Meh. Huge expensive house? Meh. Travel? Where do I sign.

[Freedomin5]

There’s a difference being cheap and being frugal. In my mind, being cheap means that others, such as your family, suffer or get hurt because you can’t bear to part with your money. Being frugal means that you spend only on the things that make you happy, and you try to maximize the value per dollar.

For example, I also watching our net worth grow by saving the majority of our salaries, but I don’t feel like I’m stingy or cheap because we generally buy whatever we want. I do, however, try to use coupons and discounts to stretch how far my dollar can go, and I buy quality goods secondhand. I don’t spend on things that don’t give me joy, and I try to optimize spending on the things that bring joy.

[OtherJen]

There’s a difference being cheap and being frugal. In my mind, being cheap means that others, such as your family, suffer or get hurt because you can’t bear to part with your money. Being frugal means that you spend only on the things that make you happy, and you try to maximize the value per dollar.

For example, I also watching our net worth grow by saving the majority of our salaries, but I don’t feel like I’m stingy or cheap because we generally buy whatever we want. I do, however, try to use coupons and discounts to stretch how far my dollar can go, and I buy quality goods secondhand. I don’t spend on things that don’t give me joy, and I try to optimize spending on the things that bring joy.

I agree on with your distinction between cheap and frugal.

We don’t spend much on housing, cars, or travel because those aren’t our priorities. However, we don’t skimp on high-quality food for ourselves or our pets. It’s a matter of both health and hobby (we love to cook). If we can buy something that we want on sale or with a coupon, great! That’s the ideal. But most of the coupons that we get are for sugary and/or highly processed foods that we don’t eat.

We also choose frugal rather than cheap for our beloved hobbies. Mine is knitting. I don’t need expensive tools, but I am willing to pay a bit for quality needles that won’t warp, break, or screw up a project and nice yarns instead of the cheapest scratchy options at the big-box store. Since these aren’t immediate necessities, I stock up for projects during sales. Husband learned early on to use quality tools and ingredients when homebrewing. He doesn’t need top-of-the-line stuff, and secondhand is fine in many cases, but he wants to avoid scorching in the bottom of a flimsy kettle or contamination because something warped or cracked and couldn’t be cleaned properly.

[Greystache]

I get a great deal of joy by getting great deals.  I love thrift stores. I buy high quality things for one tenth of their retail price. I also try to buy things that will positively impact my life. I will spend money on golf equipment and clothes (used or heavily discounted) because they encourage me to get some exercise. I buy tools because they encourage me to design and build useful things.  The only area where I buy things that I don't need just because it makes me happy is watches.  I have a half a dozen high quality watches and a couple beaters that I wear in the shop. Obviously, I can only wear one at a time and with a cell phone in my pocket, you could argue that I don't even need one, but I like watches and they make me happy and by the way, I got a great deal on every one of them ;)

[Hula Hoop]

I went to a large fast fashion clothing store this morning to return some stuff and buy new shorts and t-shirts for myself (since I work from home now) and I saw some t-shirts that were exactly perfect for my 2 kids' interests.  My kids really don't need t-shirts but I bought them anyway.  I classify this as a 'splurge' as the kids have enough t-shirts but they were small expenses and the kids love them.

[BTDretire]

I had a chocolate shake from Chick-fil-a last night!
Maybe do that 4 or 5 times a year. Whoop, whoop!

[ixtap]

How do mustachians count take home pay? We only think of the bit that gets deposited in checking as our take home pay. This means that 401k, HSA, ESPP and RSUs, which all go to other accounts, aren't part of it. Even though we will occasionally take cash from ESPP or RSUs before reinvestment, psychologically, that is removing money from savings, not take home pay.

[2sk22]

How do mustachians count take home pay? We only think of the bit that gets deposited in checking as our take home pay. This means that 401k, HSA, ESPP and RSUs, which all go to other accounts, aren't part of it. Even though we will occasionally take cash from ESPP or RSUs before reinvestment, psychologically, that is removing money from savings, not take home pay.

I follow exactly the same approach myself. I only count what's deposited as pay. Gross pay is an abstraction not worth thinking about.

[Zikoris]

The MMM way of calculating take-home actually requires including employer-matched funds - otherwise you end up with incorrect numbers when calculating your savings rate and making FIRE date projections. Run a few sample calculations with and without, and the problem will become obvious really fast.

[John Galt incarnate!]

As for the OP I'm in the not splurge but live your life as you want camp. My splurge is FIRE and free time to do whatever I want. I wouldn't trade that for any upgrade in my life style.

I like lots of money but I will not trade my time or damage to my telomeres to get more of it.

*Knowing you as I do from your posts I think less free time for you would surely be a downgraded lifestyle.

It would surely be so for me.

*My pet name for you is "Lady Leisure."

As for splurging, I have so much excess stuff now there's absolutely nothing I need  and almost nothing I want.

 I am overstuffed; there's no doubt about it.

[mathlete]

I follow my heart, lol. Most of the time it tells me that new purchases won't make me any happier, and so I listen. Occasionally though, there's a breakdown. Recently I spent a grand on various audio equipment. I'm the kind of guy who has always listened to the TV through the built in speakers and worn $10 headphones. So after a lifetime of doing this, even decent speakers and decent headphones have been a huge upgrade.

[Buffaloski Boris]

What do you mean by splurging?  Buying something that you had planned and will bring you pleasure, or just impulse purchases? 

Frugality for me is the reward, not the sacrifice.  I enjoy the intellectual challenge of figuring out ways to make money stretch farther and do more.  It's a game that I very much enjoy playing.  And if we do reasonably well at it, we'll be able to finance pretty much whatever we want. It beats the hell out of football.   

[American GenX]

At this point, I wonder how can I stop being so cheap. I am sure many of you have faced this conundrum. It is our frugality that helps our FI but again we need to relax it a bit to start enjoying life more. How do you decide how much to set aside for splurging and what are some things you splurge on

You don't have to stop being cheap/frugal to enjoy life.   That reminds me of a woman I was involved with who told me I was not enjoying life because I had a lot of money saved and wasn't spending it.  Of course, she was in debt with no savings.

Anyway, to answer the question, I'm single with no kids and still working, hopefully will FIRE in another year, and I do not have a "splurge" budget, so nothing is set aside for that.  I don't even keep my car and house maintenance sinking funds accounted for separately, they are just in the budget to include long term spending items, but everything goes into the general stash, which is in different accounts and funds.  If need/want something, the money comes from there, for an emergency, major house maintenance, splurge, etc.

Over the last few years, I've averaged spending  just a few hundred dollars per year on discretionary spending.  I never felt like I was suffering and haven't been unhappy.  I actually enjoy saving and not spending.  This year, I've spent less than $100 on discretionary spending to this point almost half way through the year as I've spent less due to the pandemic.

I have only a small desire to travel, so I have a $0 travel budget while working.  The only things I'm even considering splurging any significant amount of money on while still working are things to further help/motivate me with my exercise habits, like an electric assisted bike and replacement/upgrades of indoor exercise equipment.  I'm hoping to put off any new vehicle purchases, new electronics (TVs, PCs, cell phones, etc), and more costly "non-repair" home improvements projects until after I FIRE.  My discretionary spending will likely go up considerably when I FIRE, thanks to all the extra free time, and I'll finally do some traveling, albeit mostly within the U.S., but I've got a $40,000/yr buffer for discretionary spending for FIRE after necessary expenses, sinking fund deduction, and taxes.  I can't really see myself spending $40K/yr on discretionary, but at least it's there if I need/want it.

[American GenX]

ETA Also OP if you earn $280k/year and have only $1.2 million saved and don't think that's enough to FIRE on to cover your expenses, I'm going to say you probably already have a ton of splurges in your life.

Yeah, after taxes, I was thinking that much income would be at least 2 1/2 times my entire yearly FIRE budget!

[undercover]

It really is a good question though. I think everyone struggles with wanting to buy things they don’t need from time to time, even the best of us.

It doesn’t make sense to hoard up a bunch of money but it also doesn’t make sense to buy a bunch of things you don’t need. In building up your frugality muscles, you get excited when you solve a problem creatively and save a bunch of money, but eventually that money adds up and you have more than you know what to do with. You do need to find things to do with it and in my opinion they don’t always have to be “productive” things. It does feel good to just blow some money and not feel bad about it within reason.

I mean nobody NEEDS a performance model long range Tesla, perched up house on the beach, private jet, unlimited travel funds, but nobody would say NO to that either given unlimited resources. Then again, there is a certain appeal to “less is more” and in practice it does make sense to temper your desires more than it does to satisfy your wants since your wants are unlimited and you can actually learn to control your desires and become happier without spending anything. But then again also we are humans and our entire problem is the inability to sit still in an empty room. So yeah, this is complicated stuff at times and I’ve battled with it myself, lol. The truth is that none of us are operating in isolation and everything is connected so sometimes it’s less about what you want and more about what the world wants of you.