5 Ways To Lower Expenses in Your Working Years While Living a Luxury Lifestyle
Finding a balance between living for today and saving for tomorrow is the yin and yang of personal finance. You don’t want to leave yourself struggling in retirement, but you also shouldn’t grind through your working years completely devoid of enjoyment — or even a little luxury living.
The good news is that with some clever strategizing, it doesn’t have to be an either/or proposition. Here’s how to live the high life while you’re still working without spending so much that you’re stuck scraping by when your earning days are behind you.
Also see ways to live a luxury lifestyle on a budget.
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Identify Your Millionaire Mindset: What Does Luxury Mean To You?
According to Mariah Hudler, a licensed mental health clinician, certified financial therapist and generational financial strategist at Koru Financial Therapy, the most significant thing you can do is work on a mindset shift toward “mindful and intentional consumption.”
“For example, define what a luxurious lifestyle means to you,” she said. “Cars, travel, homes, a certain community. Then, build out your life with those who also want to live that lifestyle, such as your partner and your networks. Having a solid vision with support and encouragement from others will help you to live your luxurious lifestyle within reasonable means.”
Learn More: How Much Does the Average Middle-Class Person Have in Savings?
Subscribe To the Luxury You Can’t Afford To Buy
Everyone is familiar with the toys and experiences that define the aristocracy. Most people can’t afford to buy them — but they might be able to subscribe to them.
“Instead of large, one-time expenditures, consider subscription services or memberships that offer the same luxury with predictable costs,” said David Blain, chartered financial analyst (CFA) and CEO of BlueSky Wealth Advisors. “For instance, instead of buying a luxury yacht, joining a high-end boat club can offer the same experience without the upkeep and depreciation costs.”
SailTime, for example, offers fractional memberships that guarantee you monthly usage of a specific boat that you choose and subscribe to with only a handful of other members.
If you’re more attracted to the skies than the seas, platforms like Jettly offer memberships that buy you access to private and semi-private charter flights without having to own your own plane.
“This approach also gives you the flexibility to change luxuries as your interests or circumstances change, ensuring a continuous but financially feasible indulgence in your lifestyle preferences,” Blain said.
Invest In a Vacation Property and Make It Your Own During Offseason
A beach house, mountain cabin or lakefront home is a luxury that most people can’t afford, but if you view a vacation property as an investment instead of a private retreat, you could recoup a lot of the cost while still enjoying the shoulder seasons for yourself.
“I advise clients to buy homes in popular spots, rent them out during peak times and enjoy them off-season,” said Rhett Stubbendeck, CEO and founder of Leverage Planning. “It’s an effective way to afford luxury vacations without the expense.”
Drive In (Pre-Depreciated) Style
Even if you subscribe instead of buying, you can’t fly in a private jet and sail in a custom yacht only to drive to your off-season vacation property in an entry-level sedan. The problem is that luxury cars are expensive — at least for their original owners.
“I often suggest buying a luxury car that’s a few years old to avoid the steep depreciation of new models,” Stubbendeck said. “This lets us enjoy elegance on a budget.”
According to iSeeCars, nearly every single one of the 25 fastest-depreciating vehicles is a luxury model. All of them shed more than half their value in the first five years of ownership — a few even offer discounts over 60% off the original MSRP.
For example, a Range Rover costs $68,874 less than its starting price after five years. You’ll save more than $70,000 on a Mercedes-Benz S-Class. If you buy a five-year-old Maserati Quattroporte, you can expect to pay more than $90,000 less than the original sticker price.
Credit Card Rewards: The Everyman’s Ticket to Luxury Living
Even with savvy strategizing, luxury vehicles, investment properties and jet or yacht subscriptions will be out of reach for many. In that case, the most accessible path to a taste of luxury living might be a much more modest investment in a credit card with a rewards program designed or lavish living.
“I help clients select credit cards that offer the best perks for their lifestyles, from travel upgrades to dining,” Stubbendeck said.
The American Express Centurion Card, known colloquially as the “Black Card,” is the most elite, exclusive and prestigious credit card on the market. Its rewards are the envy of even many rich people and its $5,000 annual fee is a drop in the bucket compared to its minimum annual spending requirement of up to $1 million. According to Forbes, the general public can’t even apply for it. Applications are invitation-only and those invitations are reserved for a tiny and select crowd.
However, mere mortals can apply for cards like the American Express Platinum, Chase Sapphire Reserve, Capital One Venture X Rewards, MasterCard Gold and Master Card Black, which have annual fees ranging from $395 to $995.
That three-figure fee buys you high-class perks like 24/7 concierge service, Uber VIP status, VIP airport lounge access, subsidized Equinox club memberships, credits for high-end hotels and stores like Saks, room upgrades and more.
It’s not the Black Card, but a few hundred bucks per year can let you roll like a rich person — or at least get a taste of the good life.
“For me, it’s all about stretching every dollar for maximum luxury,” Stubbendeck said.
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