Good post Jimi! Like you, I have kids so I'm not about to blow all of our disposable income on my personal interests... not sure if my wife believes that though.
I won't buy anything that I can't afford to pay cash for, so if it takes time to save for an item it gives me lot's of time to do research. I truly find this part (research) to be as enjoyable as the purchase itself.
I'd love to add a 335 someday, and would probably even save for a used Gibson... so maybe $1,500 would be the max for a guitar for me. Fantastic Amps can be had anywhere from $450 to $1,500, so I think $1,500 would me my top end there as well.
I've bought some good equipment this past year for less than half of my 'upper limit', and I'm pretty happy with that gear.
Guitars for most of us are just one of our hobbies, so we have to be responsible with our $$$.
In the end I realize buying gear doesn't make you a better player... time and a lot of practice do! Even then some seem to excel faster.. but's it's the journey, not the destination that's truly important.
Cheers!
Gearlist:
Electric: Ibanez 'AS103', Fender Dlx Nash Pwr Tele, Fender Squier '62 JV Strat, Squier '51, Squier 60's Classic Vibe Strat, Epi Elite LP Studio, Hagstrom Swede Acoustic: Larrivee LV-03RE, A&L AMI, Yamaha FG340-T Bass: Yamaha BB 450 Amps: Roland JC-120, JC-50, Peavey Classic 30, Fender Super Champ XD Pedals: Marshall Guv'nor Plus, Danelectro Cool Cat Drive, Transparent Overdrive, Digitech Digiverb, Bad Monkey, Ibanez TS-9, Boss AC-2, CE-5, CS-2, DD-3, DF-2, DS-1, FV-100, GE-7, OC-2, PSM-5, SD-1, TU-2, DVM~BYOC 'Lush Puppy' Chorus