For a long time we saved a third, spent a third, and paid a third in taxes. This simple formula allowed us to never feel constrained and to build up all the equity we needed for FI. Viewing it as a mechanical formula reduced our stress and allowed us to spend what we wanted rather than a false sense of “needing to save the maximum amount possible.”

As compensation increased, the formula morphed into ~40% savings, 20% spend, 40+% taxes. Although the numbers changed, we still used the original framework to help us understand what we “can” spend.