this wasn't in the plan |but life is still pretty good

"We can't afford it" seems to be a phrase that's commonly tossed around (but maybe not enough?). But I often wonder how people determine what they can and cannot afford.

Clearly if you would have to go into debt for something then you definitely can't afford it. But if the purchase will leave enough money in your bank account to keep you comfortable (and by that I mean a few months worth of living expenses or maybe just a few thousand dollars, whatever works for you), then go for it. It's probably a good idea to make sure that the purchase won't negatively impact any of your savings goals.

That's what I think, but what about you? How do you determine if you can afford something?