For some, it may be designing a home that looks like it’s stepped right out of Architectural Digest. For others, it’s traveling as and when you please, staying in world-renowned hotels, and eating at five-star restaurants. For some, it’s just about the simple pleasures in life, and being able to budget both the time and money to be able to afford them.
No matter the kind of luxury you’re interested in, if you don’t have seemingly endless disposable income on your side, you’re going to need to do a lot of scrimping and saving. To do that effectively, you need an idea of what you’re saving for, as well as how much will be needed.
And we’re not just talking about the luxury purchases you want to make; you need to budget for the big expenses that could hit you out of nowhere too. With that in mind, here are some ideas to use when planning out your savings, which will then help you to achieve that sense of financial freedom you’re really after.
A Gap in Income
It’ll be hard to support a luxury lifestyle if you’re experiencing a gap in income. After all, if you’re not bringing in a steady wage of any kind, you won’t be able to keep your bank account topped up. Very few luxury items can be bought without this guarantee, even if you have a rewarding credit card to make use of!
As such, ensure you’re saving at least part of your salary, just in case. Start with about 10% of your monthly earnings and put them away. Aim to have around 3 to 6 months of your usual income in savings, so you can rely on this to cover the gap between your previous job and your new one.
That usually leaves enough time for someone to pay the bills and secure a new role without having to dip into debt.
And remember, the more diverse your income is, the less risky a gap like this will be. It’s why so many people invest in side hustles in the 21st century, and if you’ve got the time for one, it’s worth considering your own.
Home Repairs and Renovations
Turning your home into a luxury space is easier than you’d think. While we tend to think of luxury properties as being quite spacious, even the tiniest of homes can be turned into luxurious with the right decor. And then there may come a day when you decide you want to convert and/or expand the space you have.
If so, you’re going to need a sizable budget on your side! Luxury renovations cannot be done on a shoestring, and you’re not going to squeeze any more value into the space by trying this.
The best thing to do here? Make sure you know what kind of renovation you want to do. Have it pinned down exactly, and make decisions on what needs to be done, what materials will be used, and what it’s likely to cost. You can do this by asking around for quotes – as long as they’re no obligation, you don’t have to hire the contractor you speak with.
Aside from this, don’t forget about the budget you’ll need for repairs. Every homeowner in the world has to do repairs from time to time, and you won’t escape this just because you have a more luxurious property.
The roof may cave in, the plumbing may back up and burst, and the front door might come off its hinges. Anything can happen, and you’ll need at least a few hundred spares to take care of the issue!
Legal Trouble
A luxury lifestyle will mean nothing if you have no money in place to deal with legal trouble. There are various kinds a person or someone they love can get into, and having no financial safety net in place can be incredibly disruptive. Paying out of pocket for legal fees can leave you with nothing left over, and that won’t let you live the high life for at least a while yet!
So be sure to consider this possibility in your budgeting plans. If you want to have a luxurious lifestyle, the emergency fund you put together should cover at least a few months’ worth of lawyer fees. Look up the average for this in your area to get an idea of how much that adds to the pot.
You should also consider having to pay for bail at some point. This can be a large cost, depending on the crime involved, and many people find it difficult to get the entire sum together in one go.
Of course, there are services like Mr. Nice Guy Bail Bonds to cover you here, and ensuring bail can be posted without delay will help in the long run, but always have an idea of the highest a cost like this can go.
Debt Payments
If you’ve got any debt right now, make sure you pay that down before moving onto a luxury lifestyle. You need to be sure there are no issues in your credit report, nor that you’re paying out much more than you’re bringing in. Living above your means isn’t a good thing, and you can’t plunge yourself into debt in the name of being luxurious.
As such, get any debt payments out of the way before going any further. The quicker these are paid off, the faster your credit score returns to the green, and the less vulnerable you’ll feel. You’ll then be able to truly free up some space in your budget, which can be put towards the disposable element you want to use to invest in your luxury wants and needs.
Start with the small debts you can clear within a matter of weeks. Things like credit cards that have a bit of overspending on them, for example. You can then move on to the bigger debt you may be carrying, such as a student loan.
Things like auto loans and mortgages should be coming out of your account on an automatic basis already, and they should always be accounted for in your monthly breakdown. But on top of this, shift the debts you pay as and when you can.
Travel Troubles
If you would like to equate living a luxurious lifestyle with traveling, we highly recommend saving up for this before you get on the plane or boat. You’re going to need a good chunk of money on your side in order to afford the kind of traveling you’re thinking of doing. And yes, you’re going to need more than you think you will too!
For example, even with a good travel insurance policy in place, you’re going to need spare cash on your side to cover missed flights or extended hotel stays. If you have to stick around for more time than you originally planned, you’re unlikely to have this covered in your policy from the get-go.
You’re also going to need some spare cash in the piggy bank just in case you go over budget. It’s easy to do that when you’re on vacation, and you can never be sure you have enough to grab the souvenirs you want when you’re away. Plus, the cost of a hotel might go over the top as well, especially if you order room service or use amenities you believed were included, but were actually a cost on top of everything else.
Your Health
How healthy do you feel right now? If you feel pretty good, that’s a good sign! But unfortunately, it’s not one you can rely on in the long term to save money for a luxury lifestyle.
You need to have savings to take care of yourself, and your loved ones, if something happens. Whether you get injured or ill, you could need more care and support than the average person, and you could be out of work for a long time.
Paying for healthcare is always going to be the most expensive thing on a budget. Being prepared for it is key to reducing the impact.
Your Luxury Lifestyle: Budgeting for Upscale Living
Living a more luxurious life is a lovely thing. That being said, if you don’t have the wealth already in the bank, it’s going to take some serious budgeting on your part! Thankfully, that’s quite possible, and you just need to take it seriously.
Start with saving for the big expenses in life, that could become a problem at any time. Take the stress out of the decision by having an intimate knowledge of what you can afford, what things could cost, and how you can manage it all.
Knowing you’ve got the funds in the bank to cope with these will help you to keep living the way you love.
