Forum
»
How many times over should you be able to buy something before you can "afford it"
- Results 1 to 8 of 8
-
Page 1 of 1
10-24-2020, 06:37 AM
-
#1
10-24-2020, 06:40 AM
-
#2
I'd say it's less about how many times over you should buy something... and more about just what you'd have left over.
If you would go in the negative (debt) for a purchase, don't do it.
If you would go near broke (liquid / checking) for a purchase, don't do it.
If you would have at least 3-6 months of living expenses liquid left over, do it.
That's for the luxury/expensive items.
EDIT:
You can go into the "Dave Ramsey" mindset too for things that are luxury items (that you anticipate would depreciate like a car or gadget). I think for cars specifically he advocates if all of your vehicles summed together in value equate to under 50% of your annual income, then you're not being ridiculous / can afford it. Lower the threshold further to be better off, and include things like boats or what have you in that equation too.
If you would go in the negative (debt) for a purchase, don't do it.
If you would go near broke (liquid / checking) for a purchase, don't do it.
If you would have at least 3-6 months of living expenses liquid left over, do it.
That's for the luxury/expensive items.
EDIT:
You can go into the "Dave Ramsey" mindset too for things that are luxury items (that you anticipate would depreciate like a car or gadget). I think for cars specifically he advocates if all of your vehicles summed together in value equate to under 50% of your annual income, then you're not being ridiculous / can afford it. Lower the threshold further to be better off, and include things like boats or what have you in that equation too.
10-24-2020, 06:42 AM
-
#3
10-24-2020, 06:58 AM
-
#4
- 2am
- )))))))))))))))))))))))))
-
- 2am
- )))))))))))))))))))))))))
- Join Date: Jan 2013
- Posts: 21,153
- Rep Power: 196664
-
-
Originally Posted By Visel⏩
Good answerI'd say it's less about how many times over you should buy something... and more about just what you'd have left over.
If you would go in the negative (debt) for a purchase, don't do it.
If you would go near broke (liquid / checking) for a purchase, don't do it.
If you would have at least 3-6 months of living expenses liquid left over, do it.
That's for the luxury/expensive items.
EDIT:
You can go into the "Dave Ramsey" mindset too for things that are luxury items (that you anticipate would depreciate like a car or gadget). I think for cars specifically he advocates if all of your vehicles summed together in value equate to under 50% of your annual income, then you're not being ridiculous / can afford it. Lower the threshold further to be better off.
If you would go in the negative (debt) for a purchase, don't do it.
If you would go near broke (liquid / checking) for a purchase, don't do it.
If you would have at least 3-6 months of living expenses liquid left over, do it.
That's for the luxury/expensive items.
EDIT:
You can go into the "Dave Ramsey" mindset too for things that are luxury items (that you anticipate would depreciate like a car or gadget). I think for cars specifically he advocates if all of your vehicles summed together in value equate to under 50% of your annual income, then you're not being ridiculous / can afford it. Lower the threshold further to be better off.
I'm unaware of Mr Ramsey but that sounds like a reasonable approach
Originally Posted By Noobyy⏩
Yeah the reason I ask is because I was chatting to my friends about watches and they started pulling numbers out of their ass: "if you can't buy it three times, you can't afford it". I thought this was entirely arbitrary and that it has much more to do with your personal risk tolerance, time preference and general callousnessAfford has nothing to do with it, its all about how much you're willing to compromise for said item
No sig crew
10-24-2020, 07:06 AM
-
#5
10-24-2020, 07:24 AM
-
#6
10-24-2020, 07:37 AM
-
#7
10-24-2020, 07:42 AM
-
#8
- Destor
- Registered User
-
- Destor
- Registered User
- Join Date: Apr 2012
- Location: Alberta, Canada
- Age: 41
- Posts: 43,481
- Rep Power: 254906
-
-
Bout 3.50x
How does this work exactly, you don't buy it unless you have at least that specific multiple of $$$ available after bills at any given time?
Would have a difficult time thinking this way, I track and forecast my cash flow and will gladly use low-interest credit to purchase something in the moment and then pay it off afterwards. But I'm confident in my income and have pretty high risk tolerance
How does this work exactly, you don't buy it unless you have at least that specific multiple of $$$ available after bills at any given time?
Would have a difficult time thinking this way, I track and forecast my cash flow and will gladly use low-interest credit to purchase something in the moment and then pay it off afterwards. But I'm confident in my income and have pretty high risk tolerance
Bookmarks
-
- Digg
-
- del.icio.us
-
- StumbleUpon
-
-
Posting Permissions
- You may not post new threads
- You may not post replies
- You may not post attachments
- You may not edit your posts