Where to begin...
I had a similar thinking to your Husband... I Worked hard and put in extra time so Im getting what I want with the money... I get it... And I even agree with his thinking to a certain degree...
If your Husband is going to pick up extra shifts and make extra money Yes I think he should get to keep some of that money for doing something fun, like Buying a New tv...
But here is the catch... If he makes 200 bucks working overtime, I think he should be able to take 10 - 20 dollars (roughly 10%) of the extra money and save it towards a large item, or spend it on something he wants to do...
Should he take that full 200 bucks and spend it on something absolutely not...
Now I don't have any kids, so its hard for me me to make a comment about spending money to take your kids on holidays and stuff...
What I do know is that if you didn't max out your RRSP's and didn't max out your TFSA yet for this year, Damn straight you should both be working all of the overtime you can and maxing out those two retirement plans before keeping any money for yourself for fun stuff...
Your comments about RRSP's and TFSA's concern me a bit... "Maybe its time to max our your TFSA's, its lower returns, than RRSP's but maybe time to do it before your income increases after you graduate"
Do you understand how RRSP's work? and how TFSA's work?
Why is your TFSA a lower return??? Thats your choice to make it a lower return? Unless your talking about the Tax brake you get at income tax time??? But then immediately after you contradict yourself again... If your income is going to increase in the next short while (within a year or two) Of course you should be putting all your money into your TFSA, and when you get a higher income then Max our your RRSP's and Max out your carry over room... RRSP's are based off income... the More you make the more you can put in (to a certain max) But more importantly the More you make the higher percentage can be "written off"
If someone making 100,000 a year puts 10,000 into RRSP's
And someone making 40,000 a year puts 10,000 into RRSP's
Its a different outcome... same amount of money but the 100,000 Salary gets a lot more back...
Do your research, Understand your tax systems...
I get the tax breaks, don't worry!
Order of investment priority for us:
1. RRSP -- It is way, way more lucrative for us to maximize out the RRSP's, (for the tax deduction). But I may be already maxing it out this year,... so it triggers the next step:
2. Max out the employee stock purchase plan employer matching (done)
3. Next is it ensuring that we don't have any tuition debt from the final year of school. This as priority 3 is in my personal preference list, as we could borrow money at less than 4% variable, but I just don't like debt, and the extra $6k is a bad reason to incur debt if it can be avoided.
4. Next it is the RESP's - until we hit the point that we have / will have saved as much in there as we care to. (The kids will NOT be getting $80k each for post secondary, sorry to say, we don't intend to max out the RESP limits, but that is related to our family values). We are at this target if we contribute the yearly amount planned already.
6. Next on the list is the TFSA to max out.
The returns on TFSA are the smallest because of the limited tax sheltering / deduction. For us, we agree to never withdraw from our RRSP or TFSA until we intend to use them for retirement funds.
7. Lastly, we can save it in an emergency fund, in a vacation fund, in a "buy a tv" fund, or home renovations completion (about $10k left to do)
In the end, the challenge is knowing how much you want to save for retirement, and when to FIRE?
Right now, we can stop saving for retirement, and if we wait until 65, have the same (or more) monthly income / spending as we have now as a family of 4 (adjusted for inflation.)
But -- I don't want to continue at this pace of working. Maybe if I took it slowly for a couple of years, I would be re-energized to work for another 10, then FIRE before 55, maybe not.
Using FireSim, I could FIRE in 12 months, as long as DH was working at least $50k salary.
We don't have enough saved up for me to FIRE completely quite yet -- due to only one income and a huge mortgage that needs to be paid each month... so someone needs to keep plugging away to pay our living costs for the next 20 years. DH is quite happy with my continuing to work at this pace, and he is quite happy to work at a part time (or a full time) level, if the work is interesting and he sees a reason/incentive to do so. Convincing him that we should save money (instead of a new TV) so that I can work Part time for a couple of years is going to take a LOT more discussion, which is why savings specifically for FIRE is not listed above, only included as RRSP / TFSA money.
Which brings me back to my original Brain Warp:
I said "yes" to the TV if new work shifts were going to it (it is a shared luxury, after all and won't break the bank, just delay other luxuries and choices)... in order to encourage him to keep working, but it really is a luxury, not a need, or even a strong "want" like reducing my workload for a few years so I can spend time with the kids (teenagers).
So my question is -- did I screw up? In the long run, is this tactically a good choice?
What is my next step?