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When Is It OK To Forsake Stealth Wealth And Spend Up?

When is it OK to forsake Stealth Wealth?
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Lockheed SR-71 Blackbird – Ultimate Stealth

One of the biggest peculiarities for hard working folks who want to achieve financial freedom is that we often don’t know when to stop grinding. In other words, when is it OK to forsake Stealth Wealth and start spending more on a better life? After all, you don’t want to die with too much money.

Even if we get to our target net worth amount or passive income figure, we keep on going out of habit. After a lifetime of wealth accumulation, to start drawing down principal feels sinful!



Since first writing about The Rise Of Stealth Wealth, I’m proud to see a strong adoption from successful people who’ve decided to keep things low key.

Society was angry during the 2008-2009 recession, and Stealth Wealth became a way of life for those who wanted to survive. Now that we’re going through another great depression in 2021-2021, it’s very important to continue practicing Stealth Wealth.

Recently, however, I’ve started to get questions from long-time practitioners regarding when it’s OK to forsake Stealth Wealth and ball out a little. After all, most Stealth Wealth practitioners have seen their net worths more than triple since 2009.

Here are my thoughts for those of you who want to risk the wrath of a jealous society. As usual, I’ve set up some stringent conditions so that you’ll actually feel OK wasting money when the time comes! 



When It’s OK To Forsake Stealth Wealth

Forsaking Stealth Wealth is allowed if you qualify for at least THREE of the following conditions.

1) When you hit age 40.

You’re half dead at 40. Anybody who rages against you after you’ve spent 20 years working is a moron. They either weren’t willing to grind as hard as you, don’t know how much effort you’ve put in, or simply like to blame society for all their problems.

It’s not a big deal for a 40-year-old guy to drive a Porsche 911, wear a Patek Philippe, and own a beachfront vacation condo. It’s not a big deal for a 40-year-old gal to drive a Mercedes SL convertible in $1,000 Manolos, if that’s possible. If you can’t live it up after the age of 40, when plenty of people die in their 50s, then it’s just a crying shame to work all those years for money not spent.

2) When your net worth equals 20X your gross income or more.



You’ve reached junior financial independence status once your net worth has hit 20X your gross income, e.g. $100,000 household income, $2,000,000 net worth. You’ve reached senior financial independence status once your net worth is 50X your gross income, e.g. $200,000 household income, $10,000,000 net worth.

If you’re still waiting five minutes to save 10 cents a gallon on gas, aren’t willing to turn up the heat when it’s freezing, or still tipping your minimum wage earning waiter less than 20%, you’ve got to slap yourself silly for being overly frugal.

For those of you who want to forsake Stealth Wealth because your net worth is equal to 20X or more of your annual expenses, sorry. Keep on grinding because it’s better to be safe than struggling when you’re too old to work. 

Getting to 20X spending is relatively easy after a while. When people focus on a multiple of spending, they will often “cheat” by trying to spend so little to get to 20X. Instead, if you focus on 20X – 50X your gross income, then you CAN’T cheat in terms of being overly frugal. You’ve got to focus on building your wealth through income and hustle!

Net Worth Targets By Age, Income, Work Experience Chart


Related: Target Net Worth Amounts By Age, Income, And Work Experience

3) If you’ve owned property for at least 15 years.

Owning your primary residence is the responsible thing to do because you shouldn’t fight inflation. If you’re still renting, then it’s likely you haven’t come up with a 20% downpayment yet, don’t know what you want to do with your life, and/or don’t know where you want to settle down. That’s fine, because all of us go through this “finding out phase.”

But if you’re still finding yourself, the last thing you want to do is spend your money on wasteful things. If you don’t have a 20% downpayment yet, it’s not a good idea to splurge on a $10,000 trip to Europe on your credit cards!

The vast majority of people I know who decided to continue renting since I graduated from college in 1999 are much less wealthy than those who decided to buy. Deny homeownership all you want; there’s a reason why the median net worth of a homeowner is ~40X greater than the median net worth of a renter.

After 15 years of property ownership, you’ve not only increased your equity through appreciation, you’ve also paid down ~25% of your principal through regular mortgage payments. Such forced savings puts you ahead of the typical consumer because the typical consumer can’t save for donuts.

Real Estate Income Is Sticky


Related: Buy Real Estate As Young As You Possibly Can

4) Your house value is at least 20X your car’s value. 

Let’s say you own a $500,000 home and drive a $20,000 car. You’re free to spend more frivolously given your ratio is 25:1. But let’s say you only have a $200,000 home, but drive a $55,000 BMW. It’s clear to me you’re overly focused on projecting status instead of building your wealth to take care of your family.

There’s no way in hell you should be spending any more money on things you don’t need. You can be more conservative and compare your home equity to car purchase price as well.

The better car buying rule to follow is my 1/10th rule. The 1/10th rule states you shouldn’t spend more than 10% of your gross income on a car.

Fiscal Responsibility FS-FR Score

Related: The Fiscal Responsibility Ratio

5) You have multiple sources of income.

If you’ve only got one source of income, it’s going to be much harder to achieve financial independence sooner than the average bloke. But if you can build at least one other income source equal to at least 30% of your day job income, you deserve to treat yourself to some fine shoes.



The person who makes $60,000 a year at her day job and $18,000 a year in freelance work is my hero. She knows that with more time, her freelance brand will continue to grow and so will her revenue.

From experience and discussions with other hustlers, 30% is the tipping point where people really start to believe that they can leave their jobs to pursue their passions. Just be careful though. Once you leave your job, you’ve got to start the equation all over again.

The other common way to build an additional income source is obviously through investing. It feels great having your money work for you so you eventually don’t have to.

The Best Passive Income Investments

Related: Ranking The Best Passive Income Streams

6) You’ve consistently saved 50% or more of your income for 10 years.

The 50% can include your pre-tax 401k/IRA contributions, your after-tax investment contributions, or a combination of both. After 10 years of saving 50% of your net income, you have 20 years of living expenses in the bank or brokerage account. There’s no reason why you can’t splurge on that three week Mediterranean cruise with a balcony.

If you successfully save 75% or more of your income for three years, you’re also free to splurge. The math is similar to saving 50% of your income for 10 years. Living like a pauper for too long kind of defeats the purpose of money.



Related: How Much Should I Have Saved By Income And Age

7) You have a profitable business that earns at least 2X the median income of your city.

One of the nice things about owning a business is that you can deduct meals, trips, vehicle expenses, and other equipment necessary to run and grow your business. If you can be in a fun business, even better!

Attending a conference in a great location is one example of a nice business expense. You can write off your plane ticket, hotel cost, half your meals, taxi fares, and cellular phone usage among other things. Therefore, your true cost is whatever the original cost is minus your effective tax rate.

But running a profitable business can be hard. Therefore, your business must have operating profits of at least 2X the median income of your city before you to start feeling like it’s OK to loosen your wallet a little, e.g. $160,000 in operating profits compared to San Francisco’s $76,000 median household income.

You can Forsake Stealth Wealth if you are making side income
Blogging income statement

Related: How To Start A Profitable Website

8) Your kids are independent adults.

If you’ve managed to raise independent adults who aren’t coming to you for a mortgage downpayment, a place to live, a car, laundry, or your yummy meatloaf, then well done!



There are so many young folks out there nowadays who don’t give a crap about working hard because they know the Bank of Mom and Dad will simply bail them out.

Say no to raising spoiled children

There are kids in high school and college who brag about their fancy cars, even though their parents made the purchase. No wonder they get beat up all the time. What kind of insensitive idiot rubs their wealth in other kid’s faces when nobody has a full-time job?

There are college graduates who brag to their friends about their new condo their parents bought for them too. No wonder why they don’t get promoted or paid as well at work. Why should they when they’ve already told all their colleagues they’re rich.

Young adults are savvy nowadays. They know how to convince their parents to pay for everything even as adults. If you’ve been able to instill in your kids the pride of making it on their own, you deserve to live it up. There are just way too many spoiled rich kids ruining it for the rest of us because their parents have no discipline to tell them to make their own fortunes.

Related: Why Millennials Don’t Give A Damn About Money

9) You’ve got a pension that covers all your living costs.

If you’ve got a pension, count yourself as one of the lucky few who never has to worry about money again. To earn a pension that covers all your living costs comfortably, that must also mean you worked for at least 25-30 years at the same institution. That is an incredibly honorable feat that must be rewarded given everybody is afflicted with the “grass is always greener” syndrome nowadays.

How to calculate the value of your pension chart

Related: How To Calculate The Value Your Pension

10) You got a full-ride to college.



If you’ve somehow managed to side-step the burden of college tuition through merit, then you deserve to reward yourself for a job well-done. You likely won’t be one of those students who believes he deserves an “A lifestyle” while getting C’s.

A full-ride is tuition, room, and board 100% paid for by the school or an outside scholarship. Having your parents pay for everything does not count!

11) You’ve successfully not told anybody how much you truly make for 10 years.

When you’re young and insecure, it’s very tempting to tell all your friends how much you make, especially if you know it’s more than most people. By bragging to your friends, you end up making enemies.

If you’ve been able to keep your true income and wealth under wraps for at least 10 years, you’ve been able to overcome your insecurity. Your mindset changes from trying to feel better about yourself, to trying to help others.

Related: Never Tell Anybody How Much You Truly Make

12) You pay more than $100,000 a year in total taxes.

If you’re paying almost triple the average household income in the form of taxes, you should be able to splurge on that $100,000 wedding after buying a flawless two carat ring.

Such expenditure might keep you in the rat race for years more, but hey, you deserve it. You’re helping subsidize a high percentage of Americans who pay zero income taxes to keep the country humming. Live a little.

Paying massive taxes at $500,000
If you’re working 60+ hours a week for the privilege of paying $185,600 a year in city, state, federal, and social security tax, you deserve to live a little once in a while!


Related: Scraping By On $500,000 A Year

Or, you can be like this person who makes $100,000 a year, but pays a more reasonable ~$22,500 in property, state, and federal taxes.

how to pay less taxes from your day job

Related: How To Pay Little To No Taxes For The Rest Of Your Life

13) You’re donating at least 15% of your gross income to charity.

Did you know the average percentage of income donated to charity is less than 5%? If you’re consistently donating 3X the average, you’re doing a splendid job! And hopefully, if you can afford to donate 15% to charity and pay taxes, then you’re likely relatively well off.

Forsake Stealth wealth and donate more to charity
Source: IRS Statistics Of Income 2014

14) You got dependents and need to focus on safety.

Before having a baby boy, I cared mostly about convenience when driving a car. My Honda Fit that would neatly park in 25% more spots around San Francisco. It was economical as well at only $234/month charged to my business. But several months before my wife gave birth, I decided to focus on safety.

I could not forgive myself if anything happened to my little one in an accident. I also suddenly started focusing on the need for my wife and I to live for at least 18 more years as well!

Therefore, I decided to trade in my Fit for a Range Rover Sport. With thicker doors, larger buffer zones, more safety features, and a heavier weight, the Range Rover should protect the passengers more than a Fit. I gladly was able to forsake Stealth Wealth for safety.

Forsake Stealth Wealth: My new mid-life crisis car: a Range Rover Sport HSE

Forsake Stealth Wealth Only For A Bit

Despite a lot of uncertainty in the economy in 2021, at least we experienced a 10-year bull market. It’s become slightly more acceptable to live a wealthy life now. But the longer the government shutdowns last, the more dangerous it is to spend your hard-earned wealth.

The more mindful you can be about other people’s financial situations, the better people will treat you. In fact, I encourage you to be more humble and seem less knowledgeable than you really are to get ahead. The people who are shouting from their rooftops about how rich they are aren’t as happy as the people who feel no need to do the same.

Forsake Stealth Wealth by spending some of your savings so you don’t have to think to yourself, what’s the point of working so hard and saving so much. But quickly tighten your budget again as we ride out this latest great depression.

Readers, what are some more examples that will allow people to forsake Stealth Wealth? Do you qualify for two or more of the items above?

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