The Wristwatch Dilemma – An Updated Discussion

Stephan asked a question in the comments section a couple of weeks ago. I made a note to myself to respond and neglected to do so.

My apologies, Stephan, and thank you for reminding me.

Here’s Stephan’s question:

Hi Byron,
I have read the old money book recently and really appreciate it. I especially liked the rule of the car purchase, 10 % of the you annual income. Do you have a similar idea or rule for a luxury watch? 🙂

I would like to have a stainless steel Rolex Datejust 36 mm, silver dial. I have looked at it for several years. The problem is I am “only” 35 years old and have saved and invested part of my salary for about 7 years (since I started work after university). Of course I know that it’s stupid thing to purchase an expensive watch like that when you’re not financial independent. (25 % financial independent at the moment).
Should I wait or may it be justified to buy one or two luxury items like this during your way to financial independence?

Many thanks in advance!


I think this is a great question…and an eternal dilemma: at what point in time or at what financial level do we splurge and enjoy ourselves? This question reflects the dual purpose of money: to provide a means of survival for us on a daily, weekly, and monthly basis, as well as to acquire luxuries (material possessions or experiences) which we can enjoy, alone or with family and friends. Charity, of course, is in the mix, too.

To address Stephan’s question, I would say this: everyone’s financial situation is personal and unique to them, and I’d never say it’s ‘stupid’ to want a luxury item. It simply comes down to knowing the wisest moment to purchase it.

When referencing the term ‘25% financially independent’, you may want to ask yourself a few questions:

First: can I go 12 months without income and survive on my savings and investments without liquidating assets or going into debt? If you’ve got 1 year of living expenses in the bank, you’re on the road to financial independence. If you’ve got 100 grand in the bank (cash) and other assets, I wouldn’t see a problem in spending 5 grand on a pre-owned Rolex, (a 5% rule, I guess) but read on before you go shopping…

Second question: if I purchase this Rolex (uh, cash please, no credit card debt), is the expenditure going to impact any other opportunities that may be on the horizon, such as starting a business, purchasing real estate, or obtaining additional education or specialized training in my field?

If you dish out for the Rolex and then miss out on an investment or advancement opportunity, you may regret it. So think about that. If you’ve got the ‘opportunity money’ set aside, then you could be okay. (Do you have or expect children? Is their education paid for?)

Third: does a stainless steel Rolex fit into my current lifestyle? Or would it stand out as a single, possibly inappropriate luxury? Would it alienate my friends? Or would they be happy for me? If you’re socializing with other college educated, upwardly mobile young professionals, then it’s probably not an issue. Also, you’ll want to make sure that the rest of your image is in order: you’re taking care of your teeth, skin, hair, and body so these are all very presentable…before you buy a luxury watch.

Finally, ask yourself why you want a luxury wristwatch. I ask this because I’ve known probably a half dozen guys who have worked hard, saved and invested, performed and prospered. They’ve then purchased a gold Rolex (invariably), worn it for a week, and then put it back in the box and into a sock drawer. The reasons–lifestyle issues, impact on relationships, or simply the disappointment that the Rolex didn’t deliver SOMETHING that they thought it would–all contribute to this disappointing (not to mention expensive) journey.

If you simply enjoy the idea of owning a Rolex, and you’d enjoy wearing one if you were alone on a desert island with no one else around, then great. That’s the way to identify a luxury that has meaning to you. Trying to impress others is a tricky business. Better to have a long, honest conversation with yourself before buying something you don’t really want…or if you don’t know why you want it.

Of course, I’d love to hear from the tribe, and from you, Stephan. I’ve thrown out some general questions that could form a guideline for all future luxury purchases. I hope it’s helpful.


  • BGT


10 thoughts on “The Wristwatch Dilemma – An Updated Discussion

  1. I purchased my first Rolex in my early 30’s. I also have a second Rolex and a Patek Philippe. I mostly wear my Nike Apple Watch/cellular. There is a Hermes edition which is very nice as well. I find it is more practical to wear my Apple Watch. FYI Apple Watches outsold the entire Swiss Watch industry in 2019 by 10 million units.

  2. Good evening Stephan,

    This is an interesting topic – especially that I have had a lifetime fascination with watches. Byron has covered some important aspects regarding the purchase of such an item. If I may I’d like to share the following personal experience(s) with watches which might help you decide.

    The first Rolex I owned was a so-called Submariner ‘Red’. It was stolen but had I still owned it it would have been very useful in terms of resale value. I have seen them sold for between 20 and 30K$. Like anything it depends on the model, condition, vintage, provenance etc. This might come in handy down the line with childrens education, for example. My second Rolex was a DateJust. Simply put, nothing special and no special resale value. However, just after I’d bought it I was at work one day and a colleague looked at my wrist and said ‘Mmmm…. I see you have a Rolex’. It was one of the last times I ever wore it. I felt uncomfortable as it had attracted a form of attention I do not seek. It lay in a drawer until I sold it some years later and bought an Omega Speedmaster with a leather strap. Twenty five years of use and no one has ever commented. [ I think it’s what most members of the tribe might prefer.]

    Keep this in mind too: these are mechanical watches and if you are as lucky as I was with my Speedmaster you’ll get ten years out of it before it requires a service. Currently a service with a recognized agent costs €5-600 providing there are no serious defects. In ten years time you’ll be 45 and might have other pressing needs. The Rolex might be consigned to a drawer because of those pressing needs.

    There is also the matter of insurance. Once something like this is ‘itemized’ on a policy the monthly premium goes (up).

    Respectfully may I say, if you’re struggling to decide look critically at the comments made in response to your questions and perhaps invest the money until you’re more comfortable. There is no better enjoyment than treating yourself to something and knowing there is no buyers remorse, or guilt that you’ve short-changed someone or something. That way you’ll enjoy it for what it is.

    By the way, Rolex isn’t the only fish in the sea – in spite of what their marketing department might want everyone to think. No one ‘has to have’ a Rolex.


  3. Thank you Byron, very nice of you to write this text. Really appreciate it! 🙂

    I think your answer gave me something to think about. If I am really honest to myself, I really appreciate and love a well made italian made to measure blazer or suit, or a good pair of Crockett & Jones shoes (with no labels and people around you don’t know the price), more than a Rolex watch. I don’t like watches in the same way I like clothes when I am thinking about it. But I suppose it has become a thing to me that “you should have”. I have a cheap (200 EUR) steel watch at the moment…

    I don’t even know if I would wear my Rolex when I’m visiting my parents and some of my friends, who probably would think I had lost it to spend that much on a luxury watch. Perhaps, I think the Rolex watch would be to show others and myself that I have made it….I could actually buy a new Rolex datejust and still be below the 5 % rule of my index funds, but if I am really honest I think I’m more of a Seiko guy that goes under the radar. 🙂

  4. Byron, I like your caution that you might wear the Rolex for a week and then put in the box. There are a lot of great watches in the world. I would suggest buying something fun and very affordable to see whether wearing a mechanical watch fits in with your lifestyle. A great starter watch is Swatch Sistem51. I’m wearing mine right now. It’s fully mechanical and winds with the motion of your arm. It’s made by robots and a great conversation starter. Or, perhaps, buy a vintage mechanical watch from the 1950’s. I’m Canadian so I like Birks watches because of their connection with Canadian history. Because of their age, you have to wind them frequently to keep them on time. After a year or two caring for one of these very affordable watches see if you still want to upgrade to a Rolex, and by that time your ability to afford one will be improved simply by the, ahem, passage of time. Also, your friends will know you are a “watch person” and will be less likely to feel uncomfortable if you are wearing an expensive watch knowing that it’s an aspect of who you are to have a precision watch.

  5. If you would wear it and enjoy it then by all means buy it. I agree with Byron, make sure you can justify it if other needs/issues come along. I have a dear friend who buys 18k gold Breitlings. He enjoys them and rotates them out each week, he has six. I have a gold Rolex I inherited. I never wear it, my Cartier tank is the only watch I wear. Watches are a very personal thing. It should give you joy, if it can do that then go ahead.

  6. It seems to me that in a time of ubiquitous cell phones, almost nobody actually needs a watch. Watches therefore are now almost entirely decorative items. However, if you want a nice watch, get something tasteful and understated. Avoid gaudy or flashy. I also think there is something to be said for very inexpensive watches which, these days, keep time just as accurately and reliably as expensive watches.
    It’s worth remembering that, from a financial point of view, most watches are not a good investment. It’s unlikely that you will be able to sell a watch for more than you paid for it. Nevertheless, the watch industry has done a very effective job of marketing their products. No one is completely immune from the effects of advertising.

  7. Skip the Rolex, they only require maintenance down the road. Get a Timex on a ribbon band and you’re solid.

  8. Thank you for these wise words. You distilled the issue in this one sentence:
    “If you simply enjoy the idea of owning a Rolex, and you’d enjoy wearing one if you were alone on a desert island with no one else around, then great.”

    This is the only test needed.
    Thank You

  9. I come for the articles/blog posts, and I stay for the comments. As always, Byron, this was an excellent discussion prompt!

  10. Dear Stephan,

    The simplicity of no watch at all is also not a bad option. However if you do want a beautiful timepiece which represents value, don’t rule out a vintage one. I bought a 1950’s IWC which is a lovely understated watch as opposed to what they are making today. It’s been very reliable and I probably don’t strictly service it as often as I should, but every few years it goes in for a little TLC, which is not too expense and so far it’s given me 15 years of trouble free service.


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