Finding a balance between living today and saving for tomorrow is the yin and yang of personal finance. While you don't want to be forced to struggle in retirement, you also shouldn't spend your working years struggling, completely devoid of fun or even small luxuries.
The good news is that with some smart strategies, you don't have to choose one or the other. Here we will show you how to live a luxurious life while working without spending too much money.
Also see how to live a luxurious lifestyle on a budget.
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Identifying Your Millionaire Mindset: What Does Luxury Mean to You?
According to Mariah Hudler, a certified mental health clinician, certified financial therapist, and generational financial strategist at Koll Financial Therapy, the most important thing you can do is to “be mindful and intentional. We need to work on changing our way of thinking towards “consumption''.
“For example, define what a luxury lifestyle means to you,” she said. “A car, a trip, a home, a community. Next, build your life with people who want to live a similar lifestyle, such as a partner or network. Build a solid vision with support and encouragement from those around you. By owning one, you will be able to live a luxurious lifestyle within your means.
Read more: How much does the average middle class person save?
Subscribe to luxuries you can't afford
Everyone is familiar with the toys and experiences that characterize the aristocracy. Most people can't afford to buy them, but you may be able to subscribe to them.
“Instead of a large one-time expense, there are subscription services and members that offer the same luxury at a predictable cost,” said David Blaine, a certified financial analyst (CFA) and CEO of BlueSky Wealth Advisors. Please consider shipping.” “For example, instead of purchasing a luxury yacht, joining an exclusive boat club can provide the same experience without the upkeep and depreciation costs.”
For example, SailTime offers split memberships that guarantee monthly use of a specific boat that you select and subscribe to with only a few other members.
If you're more drawn to the sky than the sea, platforms like Jettly offer memberships that give you access to private and semi-private charter flights without owning your own plane.
“This approach also gives you the flexibility to change your luxuries as your interests and circumstances change, ensuring you can enjoy an ongoing and economically viable lifestyle preference.” Blaine said.
Invest in vacation property and make it yours during the off-season
Beach houses, mountain cabins, and lakeside homes are luxuries that most people can't afford, but if you think of a vacation home as an investment rather than a private retreat, you can potentially recoup a lot of money while still enjoying the season. there is. For yourself.
“I advise my clients to buy homes in popular spots, rent them out during peak periods, and enjoy them in the off-season,” said Rhett Stavendeck, founder and CEO of Leverage Planning. “There is,” he said. “It's an effective way to enjoy a luxurious vacation without spending a lot of money.”
Drive-in (before depreciation) style
Even if you subscribe without purchasing, you can't just fly on a private jet or sail on a custom yacht and head to an off-season vacation property in an entry-level sedan. The problem is that luxury cars are expensive, at least to the original owner.
“I often recommend buying a luxury car that's a few years old to avoid the sudden price drop of a new model,” Stavendek says. “This allows you to enjoy elegance on a budget.”
According to iSeeCars, of the 25 cars that depreciate the fastest, nearly all are luxury models. They all lost more than half of their value in their first five years of ownership, with some offering more than 60% off their original MSRP.
For example, a Range Rover costs $68,874 less than its starting price after five years. Save over $70,000 on a Mercedes-Benz S-Class. If you buy a 5-year-old Maserati Quattroporte, you can expect to pay more than $90,000 less than its original list price.
Credit Card Rewards: Everyone Gets a Ticket to a Luxury Life
Even with a smart strategy, buying a luxury car, investment property, or a subscription to a jet or yacht will be out of reach for many people. In that case, the quickest route to enjoying a luxurious lifestyle may be to invest more sparingly in credit cards with reward programs and luxury living.
“From travel upgrades to dining, we help our clients choose credit cards that offer the best benefits for their lifestyle,” Stavendek said.
The American Express Centurion Card, colloquially known as the “Black Card,” is the most elite, exclusive and prestigious credit card on the market. Its rewards are the envy of even many wealthy people, and its annual membership fee of $5,000 is very low compared to the minimum annual spending requirement of up to $1 million. According to Forbes, the average person can't even apply. The application is by invitation only and those invitations are reserved for a small select crowd.
However, the average person can apply for cards with annual fees ranging from $395 to $995, such as American Express Platinum, Chase Sapphire Reserve, Capital One Venture X Rewards, MasterCard Gold, and Master Card Black.
For that triple-digit price, you'll get exclusive benefits like 24/7 concierge service, Uber VIP status, access to VIP airport lounges, subsidized Equinox club membership, credits at luxury hotels and stores like Saks, and room upgrades. You can get benefits.
It's not a black card, but for a few hundred dollars a year you can act like a rich person. Or at least get a taste of the good life.
“For me, it's about spending every dollar to get the most luxury,” Stavendek said.
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This article originally appeared on GOBankingRates.com: 5 Ways to Live a Luxury Lifestyle and Lower Your Expenses During Your Working Years