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So You Have an Expensive Hobby...

Personal Finance

All too often, personal finance advice tends to recommend frugality to an extreme. Don’t buy this, cut spending on that, keep telling yourself no, no, no! If this approach works for you, great. But we all need to recharge our batteries. There really is nothing wrong with allocating money toward your own well-being via a hobby or interest.

Maybe you’re lucky, and you have a passion for something free, like meditation or strolling through nature. The problem arises when you have a particularly expensive hobby. Golf. Horseback riding. Flying private planes. If pursuing your passion may derail your financial progress, we have a potential problem.  However, there is generally always a way to live a piece of your dream today rather than deferring it for tomorrow.

There are a number of ways to do this.

Can you buy equipment secondhand?

As an amateur participating in a hobby for fun, you may want the most high-end equipment, but you may gain just as much enjoyment by focusing on what it is you really love about the hobby. If you enjoy skiing for example, renting equipment every time doesn’t add much to the experience, but can really add to the expense. Purchasing your own equipment used or on sale rather than renting can provide a savings long-term. (As long as you stick with the hobby!)

Is there a way to participate to the extent you can afford?

Let’s take golf as an example—you may not need to join a country club to play. Many counties and states offer public memberships to their golf courses. These can be great deals if you plan to play a few times or more per month.

Can you afford the time?

Often expensive hobbies also come with a large time commitment. For example, owning a horse tends to come with chores and training equivalent to a part time job (unless you pay someone to take care of these items, which adds to the cost significantly!). However, leasing a horse a few days a week allows you to enjoy the hobby without 100% of the financial and time commitment. Make sure to find a balance where the time spent on your hobby is not taking away from your ability to achieve other life or work goals.

Can you find a creative solution?

Perhaps you can’t afford the time and/or money to make a full-time country club membership worthwhile—but you can offer to take some friends for dinner and drinks if they take you as a guest to their club.  This way you can try out different clubs and mix playing private with public. Or, you can take a page from the book of one friend of Halpern Financial who enjoys sailing. He has a large family, and realized that the cost of accommodations was about the same as renting a luxury boat for the week. An idea sprouted. He and his wife got certified as boat captains and planned a sailing vacation for the whole family!

When it comes to hobbies, limit any discretionary hobby expenses so that it does not limit your ability to save, pay down debt, or contribute to your retirement plan. Although saving for the future is critical, building wealth is not about being a Scrooge. Take an optimistic view of your longevity and plan for it prudently, of course. But also make sure to find a balance. Live for today, not only for tomorrow. Today is a gift; that’s why they call it the present!

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Halpern Financial, Inc.), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Halpern Financial, Inc.. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Halpern Financial, Inc. is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the Halpern Financial, Inc.’s current written disclosure statement discussing our advisory services and fees is available for review upon request.


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