“The cost of a thing is the amount of what I will call life which is required to be exchanged for it.”
— Henry David Thoreau
In the early 2000s, I was hell-bent on chasing every lifestyle dream I could afford.
I was a software sales exec, pulling in $160K a year – which, adjusted for inflation, would be nearly $300K today.
And I spent like it.
Two leased cars. A brand-new house in a posh suburb. An expense account for wining and dining clients. A 401(k) with a match. The works.
From the outside, it probably looked like I was living the American Dream.
Inside? It felt like a treadmill on a 12% incline.
I didn’t know it at the time, but I was designing a life I’d eventually resent: one built entirely around maintaining a level of status I didn’t actually want.
I wasn’t living a life of freedom. I was financing a life I couldn’t step away from.
When I got downsized in 2013, I had a moment of clarity:
What if all these lifestyle benchmarks I’d worked so hard to “earn” were the exact thing keeping me stuck?
We rarely slow down long enough to ask:
What actually matters and what just looks good on paper?
The Rule of Three
A few years ago, my wife and I were buying a new car. The options were endless, the upgrades endless. It felt like every feature was designed to get us to spend “just a little more.”
Then I remembered a concept from Four Thousand Weeks by Oliver Burkeman:
In a sea of infinite options, choose the ones that truly matter – and ignore the rest.
So we did.
We picked three features that mattered to us, spent on those, and ignored the rest.
The result?
No leather seats, no flashy rims.
But we got the safety features we cared about, enough power to get us up the mountain with ease, and a cargo liner for the dogs.
We drove off happy – and within our budget.
The Entrepreneur Lifestyle Trap
Entrepreneurs are especially vulnerable to lifestyle inflation because income isn’t always steady and success can become its own trap.
You scale up. You upgrade everything. You feel rich… and somehow still stuck.
I’ve seen people go from feeling free at $250K to feeling broke at $500K because they inflated every category of their life instead of choosing what mattered most.
The result?
You can’t take time off.
You can’t say no to bad-fit clients.
You can’t try new things that don’t guarantee a return.
That’s not wealth.
That’s a new kind of prison – with a better view.
So What Actually Matters?
Here’s what my wife and I choose to spend on, guilt-free:
- Travel: exploring new places 5–6 times a year
- Health & well-being: massages, acupuncture, clean food, gym memberships
- Connection: meals with friends, weekend getaways, time with family
Everything else? Low-key.
We drive a Subaru. Rent a modest place. Don’t own fancy watches or designer clothes.
Because what we’re really buying is freedom – and that’s the thing that lets me say no to work I don’t want, and yes to experiences that make me feel alive.
Enjoying Walla Walla wine tasting with friends a few weeks ago
How to Choose Your Three
If you have a partner, include them in this exercise. This is 100% a teamwork thing.
Make a list of the things that genuinely improve your life. Try not to think about what you’re supposed to want or what other people want.
Ask yourself this:
“If I can only splurge on three categories for the next 5-10 years of my life, what would they be?”
This isn’t about what sounds impressive. The idea is to get down to three things that will actually support your happiness and fulfillment.
And be specific:
- Don’t say “looking good.” Say “quality hiking gear and one wardrobe refresh per year.”
- Don’t say “entertainment.” Say “premium concert tickets three times a year.”
Mistakes to Avoid
Going over the limit: When you expand beyond three things, you’re getting back to where you started, flexing for everything and not feeling free enough to enjoy any of them.
Choosing to impress: Instead of identifying what actually makes you happy, you choose what you think will impress someone else.
Not being specific enough: “Looking good” is too broad and will lead to spending everywhere – you’ll spend by default instead of by design.
The key here is to be brutally honest about what genuinely excites you and improves your happiness versus what you think you’re supposed to want, do, or care about.
The Bottom Line
Success isn’t about affording everything. It’s about affording what matters and having the freedom to ignore the rest.
That’s The New Wealth.
Focusing on your three categories is a simple way to build the life you actually want and reduce your emotional response to temptations.
Remember, the goal here is to hold on to that sweet freedom that made you want to be an entrepreneur in the first place.
Live bravely,
Michael
P.S. What’s one category in your life you’d never regret splurging on?
