I'm fortunate enough to have saved a lot of money over the years, and have nothing specific that I'm saving for (it will be at least a few years before I start a family). This is great of course, but it does make certain financial decisions difficult.
I've lived with roommates in a really nice place with below-market rent for a long time, and am finally looking to get my own place, and I'm struggling with what my budget for rent should be. Based on my current rent and salary, rent is about 8% of my gross income, and I save about 2/3 of my take-home pay.
Sure, I could get as cheap a place as possible and keep saving this much, but that will be a huge downgrade for me. I feel like I've "earned" a pretty nice place by paying such a small percentage of my earnings in rent for many years. I am pretty good with money and save for a nice dinner here and there, I don't have a very luxurious life.
But I'm having trouble determining an upper bound for what I should pay, because honestly, if I paid $X, or $X + $1000, or $X + $2000, I wouldn't really notice the difference. Sure, at some point in my life, I'm sure I'd say "oh, it would be nice to have that $20,000 back" but I could say that about any amount.
I guess my main point is that unlike someone who is living paycheck to paycheck and has a very strict budget and thus can pretty easily calculate what they can afford for rent, my choice seems really arbitrary.
I don't want to "pay as little as I can" (which would realistically be about 4% of my gross pay), and I know I'm not going to pay the maximum that NYC landlords will allow (based on the requirement that my salary is 40 times the monthly rent, that puts my absolute max at 30% of my gross pay). So how do I decide between 10%, 15%, 20%, or whatever?