Is there ever a good time to spend big when you’re on the path to Financial Independence? That’s the main question Dave and Hayden tackle in this episode of Aussie FIRE. Together, they dive into listener questions and cover everything from buying a car to choosing between savings accounts and ETFs.

Let’s unpack the best bits.

Is it okay to splurge while working towards FIRE?

One listener writes in with a dilemma many people pursuing FIRE can relate to. He and his partner are in their early 40s with two toddlers. They have a net worth of $4 million (half in their home, a quarter in super and a quarter in ETFs) and a household income of $180,000. His question? Is it okay to finally buy a nicer car – something in the $60,000 to $70,000 range?

Hayden sums it up nicely. “It seems like the tension is that they’re doing the maths and thinking: 'If I buy a cheaper carI I could save $40,000 now and I invest it over 20 years.'”

Dave agrees it’s a common mindset in the FIRE community – optimising every dollar to achieve financial freedom as early as possible. But he also sees the bigger picture.

“This is a fairly wealthy family," he says. "This purchase is not really going to impact them and their FI goals at all.”

Both hosts agree that buying an expensive car is rarely a “smart” financial move on paper. But, sometimes, you’ve got to stop looking at everything through the lens of optimisation. If it brings value to you, then just consider going for it.

If savings rates go up, should you pull money out of ETFs?

Another listener wonders: if interest rates on savings accounts hit 7–8%, would it make sense to sell shares and move money into savings?

Dave and Hayden both see the appeal of high-interest savings accounts, particularly when you’re risk-averse or nearing a short-term goal like buying a property . Hayden admits he’s moved money between savings and ETFs depending on what’s happening in his life.

“There was so much security that came from that," he says. "I wouldn’t do it now, but I loved every minute and I wouldn’t have changed that.”

But they also caution against making decisions purely based on headline rates.

"You can’t just look at seven per cent interest and say 'that’s good' or 'that’s no good' – because everything’s relative to everything else," Dave says. "Seven per cent interest might be attractive if you expect to get seven per cent total return on your shares and you’re also on a lower tax rate. Then it starts to look pretty attractive. But then if you’re on a high tax rate, it doesn’t."

Their rule of thumb? High savings rates might make sense if:

• You’re on a low income or not paying much tax
• You need the cash in the short term
• You’re uncomfortable with risk
• The expected return from shares is low

Otherwise, Dave and Hayden believe it’s often better to keep investing – even during high-rate periods. Dave adds, “I would probably just put new money into the savings account. I would just start investing in there instead of investing in shares. I wouldn't take money out of shares."

What’s the smartest way to use a $500,000 inheritance?

A listener in their 20s is about to receive a $500,000 inheritance and is weighing up three options. He could buy a home outright with a small loan, split the money between a home deposit and ETFs, or go all-in on ETFs.

Hayden reflects on his own experience with a similar amount of money before buying an apartment. “I could have afforded a much more expensive place, but I’m just very relaxed. The mortgage payments don’t scare me. I feel I have enough of a cash buffer.”

Both agree that splitting the money between a property and ETFs might be the most flexible and rewarding strategy.

“You could perhaps opt for using a big deposit on a not-as-expensive home,” Dave posits, “and then using the rest in ETFs. And then you could actually use that as an investment property , rather than a home to live in. Then, you get to retain the flexibility it seems appeals to you from renting, while still having your foot in the property market.”

Most importantly? Don’t rush it. Dave suggests: “Put the money in two high-interest savings accounts to stay under the government guarantee limit, and think about what's going to make sense over the long term."

Margin loans vs debt recycling – what’s better?

One listener already has a $150,000 margin loan (with $125,000 still owing), but is reconsidering the strategy now that interest rates are rising. (A margin loan is a type of loan that lets you borrow money to invest in shares.)

He’s also recently bought a home, and is wondering whether debt recycling (a strategy that converts home loan debt into tax-deductible investment debt) might be a better play.

Dave is clear: “Margin loans tend to not be as attractive as using home equity for investing in shares. But just to clarify the point – debt recycling is not the same as a margin loan, because you're not increasing your overall debt to invest with. You're just using your current debt in a different way; you're recycling it. You're not actually increasing that level of debt. So in that way, it's less risk than a margin loan.”

In short, while margin loans might sound good on paper – especially for growing a share portfolio – they often come with higher interest rates and the risk of margin calls . Debt recycling, on the other hand, can be low risk if done sensibly, and can reduce the effective interest on your home loan thanks to tax deductions.

Hayden admits he’s still learning the ropes on margin loans. “I probably wish I'd tried a little bit of it with a grand or something. That'd be my approach to things: play around with a fairly insignificant amount of money for a few years, so that when I actually need to think about it, I can have some conviction.”

Should I sell my house to access equity?

One listener wants to know: if their home has gone up in value, should they sell it to access the equity?

Dave and Hayden's thoughts? Not necessarily.

Dave explains: “If you still want to be a long-term homeowner, then selling to get your money back out is not really going to achieve much. Because what are you going to do after you've sold? You’re going to have to rent. And then what? You’re going to have to hope you can buy back in later cheaper. What’s the long-term plan? Because yes, you’ve got some money sitting there, but what’s it going to be good for?"

Dave suggests that another solution could be to access equity through your bank without selling. “If the goal is to use some of the money, and you can still afford the mortgage, that's totally reasonable,” Dave says.

Both agree that homeownership still offers meaningful gains, particularly once the mortgage is paid off.

“I'd say the biggest benefit comes when you get rid of your mortgage ," says Dave. "Then, you can actually do that strategy, as I outlined before – downsizing."

The big picture: FIRE isn’t just spreadsheets

Across all the questions, a common thread emerges: while spreadsheets and calculators are helpful, life isn’t lived in formulas. Emotional value matters. Experiences matter. And sometimes, so does a splurge – if it brings genuine joy and doesn’t derail your goals.

As Dave puts it, “It’s very easy to quantify the mathematical outcome, but this is essentially an emotional decision. And if you get stuck just looking at numbers forever, you’ll probably never end up doing anything nice for yourself.”

We're always keen to hear your thoughts and topic suggestions, so hit us up at hello@aussiefirepod.com . Head over to Pearler for resources, calculators, and community insights that complement what we chat about on the show.

Until next time, keep dreaming big and living on your terms. Catch you on the next one, and happy long-term investing.

Dave and Hayden