More vs. New?
Hey guys,
I know there are the typical go-to ways of spending money once you jump into the upper-middle/lower 1% classes at a young age (assets, increased savings, loan payments, trips), but I was curious about how your buying changed in terms of things you like?
For example, if you were a fan of a brand like Patagonia, Northface, Columbia, etc. did you buy more of it (possibly some of the more expensive items?)? Or, did you start buying Canada Goose, Moncler, Gucci, etc.?
As another example, for eating out, did you eat out more in the places you really liked or did you start dropping $200+/meal in new places?
Did you travel to all the places you've always gone to and just spend more on all of the amenities you couldn't afford before? Or did you go to entirely different places where the price of entry was much higher and the location was more exclusive/exotic?
If you drove a Subaru WRX, did you trade it for an STI, or did you go for the E/S-class Merc?
You get my point. This is a genuine curiosity of mine because there are plenty of material things in my life that I like now as a lower level fintech employee, but I can imagine myself buying a handful of new things once I get the position I'm gunning for that are currently way out of my responsible spending range (maybe an Audi eTron, a couple of nice winter/fall jackets, nicer clothes, a Patek after several years of saving, and nicer trips for my wife and I).
I can't, however, see myself going all out and reducing my percentage of savings/investments as I make more just to acquire more stuff. I'm wondering though if that's how anyone who hasn't seen that kind of money thinks until the direct deposit hits, haha. I'd love to hear the perspectives of those of you who make an absurd amount of money for your age (which technically I guess is almost everyone in here, lol) and can essentially afford anything you want within reason.
Hey ashemsu, I swear if I had a silver banana for every lonely thread I posted too I'd be richer than @compbanker ...
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Bump
Recently, my former maths professor from China, who now works as a quant researcher, shared with me his own experiences on this topic. He said that when he first got his job and saw the money he was making, his first thought was to buy himself something to show off, so he got himself a bright green $3000 Moncler jacket that he had been eyeing for some time. But after the purchase, he did not feel the same sense of satisfaction he had expected. Instead, he found himself more content with the same car he had been driving, and he ended up using the extra money to give back to his community and help those less fortunate than him. His story showed me that when it comes to spending money, it's not always about buying things for yourself, but rather about finding meaningful ways to give back and make a positive impact in your own community.
This is meaningful to me because this is sort of my thought process as well. Given my nonprofit/public sector background, and my previous history as a wildland firefighter, I know all too well that I need very little to be content, as I believe those hard years working outside on a crew of knuckleheads will always be the most fun I could ever have at a job, despite it paying absolute shite.
Now that I'm approaching an "elevated" position, I see myself maybe buying one item (e.g., a nice watch that I'll never wear or something nice for my wife) per year as a representation of crossing another financial milestone (not including investments)--not because I care about the money, per se, but because the accrual of money or wealth over time can be a great measurement of one dimension of one's achievements as long as you aren't married to it as the only measure of achievement.
Since I know that getting to this place has nothing to do with how great and awesome I am, but rather is a result of effort on my part that has been amplified by many resources and experiences that I've taken advantage of over the years; I really would love to be able to use growing chunks of my money to invest in small businesses (like a non-tech micro-VC fund for cash flowing businesses that have a hard time getting loans from banks), support local nonprofits, and maybe change some people's lives (e.g., tipping extra to gig workers who actually could use the extra hundred or so instead of going out to a nice dinner).
That's not to say that I will not seek wonderful experiences for my wife and I (she cares a lot more about time spent in cool places with good food than about things), nor does that mean that I won't buy a Lexus/Supra or something else that toes the line between reliability and a great driving experience, nor buy frivolous items from time to time because life is a thing to be lived, but sometimes I feel like such a hack to be thinking this way at my age (27). It's nice to hear about someone else who saw it the same way though, as I do think it has and will continue to be the north star for my current work ethic.
Mo Money, mo problems. I traded up a domestic base model sports car for a certified preowned M3 when I was young and dumb. Wheel bearing went out quick, $3k. Spark plug wiring got faulty, $1.5k. ABS issue that never seemed to go away. It had a recall outstanding without an expected date of resolution where I couldn't trade it in, even at a BMW dealer. Drove that POS with all sorts of warning lights on and a malfunctioning AC for a summer.Not your question, but I tried to do the better part and had a nasty taste of buyers remorse in my mouth. That domestic base model car never gave me any problems, I just wanted something that got to 60 faster. That M3 got me a wreckless driving ticket the first year I had it. Domesticated car would have never allowed for that to happen.
Let me guess: Bosch ABS module? Those things are garbage and don't afflict just your M3. Same thing occured on my Passat for instance. And leading into another question, probably on my previous WRX too. And let's be honest, you still would've gotten that infraction if you were driving a WS6 T/A , Z06, Focus RS or Coyote powered 5.0 instead.
For the OP's question(s), I bought enough collector Patagonia and NorthFace to last me. Moved on to more serious stuff like Marmot. And Canada Goose is something I buy 3" magnum BB shells for every winter. With a full choke and a gas action semi-auto instead of some chump pump, I keep the freezer stocked.
I'm a car guy, so I'd definitely stick it out with the WRX (speaking from experience).
Proudly, I own 95% of what I've wanted. Sure, it took me some time to grow up and come to those realizations and earn the earning power to facilitate all that.
It's funny you say this because I was a part of the "car guy" group in high school and so many of them had WRX/STIs back then (2012). One would argue that the bug-eye models and the gen right after that are hard o contend with, but I actually haven't heard much about Subaru sense then! Might actually be worth looking into, though I'm basically an old man now and care more about reliability and drivability than speed or performance at higher speeds. I'm no longer hugely involved in car culture, but I still have so much appreciation for a well put together vehicle when I see one, and I'm still a kid in a candy store when I see RX-7s and the OG rally cars (especially Evo 7 - 9) from that generation rolling around. Just the other day, I saw a pristine 1995 Toyota Supra and audibly gasped, haha.
You make such a good point about the other, more constructive things you can spend your money on too. My father-in-law is in MT (my wife was born/raised there), and because of my schedule, I have yet to hunt with him. I think it could be a great investment in our relationship if I spent some extra cash on good gear/a solid gun and went out there. We use Butcher Box now for our meat (local spots are awful/sometimes not restocked for a couple of weeks) but we've discussed hunting elk out there and stocking our freezer with that.
This is a great point! Thankfully, since I'm a little behind my peers when it comes to what I currently make, I got to witness the pre-owned BMW craze first-hand. Outside of one guy who is an SWE at Microsoft with the TC that allowed him to buy one brand new, every other person that I know had to sell their vehicle at a loss or essentially part it out (e.g., had a friend who bought a hybrid M3 and the engine blew up, had to eat a $9k bill just to sell it).
As far as cars go, I know it's going to sound stupid but the Mazda 3 is a phenomenal vehicle. Bought one certified pre-owned some years ago and ended up selling it for profit during the used car insanity in 2021, but when I bought it (a 2014 model in 2019) at 55k miles, it cost maybe $100/year in maintenance and still pulled 40 mpg hwy. No problems despite driving it to Ohio from Oregon, DC from Ohio, and Chicago from Ohio. By the time I let it go, it was at about ~75k miles and the most "expensive" bill was the typical 30-60-90k milestone maintenance that all cars need, which was maybe $800 after taxes. Hard to beat that! Corolla-level reliability, but with a more fun driving experience and nice interior for the price.
As for upgrades, I'm too afraid to buy German for long-term daily driving, so the "highest" I'd probably go is a V6 Lexus, a Toyota Supra, or a Mazda MX-5 (get your gay jokes out of the way now--it's insanely fun to drive, lol). If we're talking leasing though, I've loved the Audi RS4 since I was kid. Would love to play around with one for a few years and then give it back sometime in the future.
FWIW a hybrid M3 doesn’t exist. Would’ve been just a standard 3 series.
I used to care a lot about having fancy stuff, but the older I've gotten, the less I care about luxury goods and being flashy with my money. I do like having "nicer" things, but "nicer" to me frankly means things like Patagonia for outerwear/hiking gear and Lululemon for gym clothes. Beyond this fairly attainable threshold, I find my excitement for brand names really falls off of a cliff. A lot of people will think I'm a clown already for buying Lulu gym clothes, but I, for example, have absolutely 0 incremental enthusiasm for buying a shirt from Gucci/Versace over Lululemon.
I've pretty much always been a minimalist at heart, but I really don't think buying a bunch of fancy things is the best way to live for most people. I'm not nearly on the same level in my career as many on WSO are, but if I ever were fortunate enough to get that high a paying job someday, I'm pretty sure I'd only slightly upgrade certain parts of my life, but would overall rather use the extra money to give me optionality (i.e. invest it so I can quit my stressful job and do something I'm more passionate about that pays less) or on experiences with people. For example, if I could be in a position to afford it someday, I'd rather use my money to rent out a nice Airbnb somewhere with some close friends than buy a new car, especially if my friends can't afford to stay in an AirBnB quite that pricey.
I don't want to get too philosophical ITT, but I really do think the way to find happiness is to live for something beyond yourself. I don't think consumption will ever be truly satisfying because there's always some other prize to be had once you've gotten one.
I’ve upgraded my lifestyle (less than I upgraded my income, of course) with things that I enjoy. I tend to focus on experiences over things, though I do continue to upgrade my wardrobe and I don’t fault people who do like shiny things
For me, it’s been about being able to choose things that are “better” even if they aren’t “better value”, e.g. I’m more comfortable spending 20% more for something that I enjoy 10% more (obv it’s usually very subjective) whereas a lot of people get worked up about getting the best deal. I’ll also shell out massively for convenience - marginal value of my time and comfort has skyrocketed (to me)
my boss and I were talking about lifestyle creep last night. people buy a new flash car and have to keep the same level of luxury forever, unable to 'de-mote' themselves due to the perceived social scrutiny. I had a couple of flash cars in my first job out of uni, and I didn't make much, but I realised how much I was spending on it post-tax... for example, despite the monthly payments/insurance/tax, one time I had to pay £300 for a lightbulb, and the times I got a flat tyre gave me the worst road rage after. I got rid of the car to save money because I had the bright idea of getting an MBA, but I couldn't afford it. so I sold my car and saved for years... never did get an MBA... still no car... still save 60-70% of my salary each month... been doing it for years, moved to a city with good public transport and I cycle places on a cheap bike.
I read a blog years ago called The Minimalists and http://www.inoveryourhead.net/best/ and it gave me a paradigm shift... I stopped caring what people thought of me... got rid of a few friends and even grew my hair long (I got big on Stoicism and Tim Ferris at this time too). anyways, the point is, I do wear Patagonia (it's not that expensive) but I'd hesitate before buying Arc'teryx, although I could easily afford it. I'm stacking chips to get out of the rat race... then I may come back to luxury goods... but I do dress good, I feel like brand names are 'tacky' (not sure if that word is used in the US), I wear smart unbranded clothes from places like Reiss. but to be clear, I do buy expensive durable clothes, suits (+$1500), shoes (+$400), and haircuts (+$100, they give you a beer and a head massage, well worth it). some suits have lasted me 6 years, despite wearing to 30+ interviews, and twice a week for ~4 of those years.
but negative lifestyle inflation is real, you can earn $500k but are you really rich if you spend $400k on a moncler jacket and the associated big house, cars, private school and wife, keeping up with the joneses? the goal is to become liquid, $10m, $50m, $100m, and that requires sacrifice, old money, or a stroke of luck/genius.
the culture may be different in Europe, but the only time I seen a fihnuance guy wearing a genuinely expensive trinket in the office was a young German PE guy with a Royal Oak AP. otherwise, it's best not to show wealth in the office, I think the rationale is that your boss might think "who does this guy think he is?" and knock down your bonus.
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