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*An Official Foo-Approved guitarist since Sept 2023.
There's only two guitars left that I want to own at some point: a japanese squier strat (so £3-400), and a Les Paul Custom, which will probably be above my threshold.
Possibly...
My real-life maximum guitar spend has risen step-wise (not steadily by any means) over the years. My first decent guitar (1985 MIJ Squier Tele, which I still own) cost £175 in 1987, but I got it on credit at £10 a month over 2 years as I simply didn't have £175 in 1987. In the 90s, £500 was about my limit, until the day I fell in love with an AVRI Strat and parted with nearly £1,000 for it. The next jump was to to £2,250 for a CS LP, of which £1,000 came from an inheritance. Since then I have generally paid between £1,000 and £2,000 for a guitar or bass.
As to what I would spend: A couple of years ago I tried a 60s SG Special in Manson's, and it was utterly fantastic. It was a 1964 at £6,800 (or possibly a 1968 at £6,400), but even if I had chopped in the CS LP and a PRS I would still have come up well short. Had I had the money, I would have bought it, but I hadn't, so I didn't.
And there's the rub - this question has two answers:
(1) £2,500;
(2) No limit, if I had the money a the time and the instrument spoke to me.
I did have a preorder for a £4399 Joe Perry gold rush CS. However I had a serious word with myself as to how ridiculous that amount was for a guitar that really isn’t worth that.
Preorder cancelled!
Max that I have spent on one guitar was, from memory, £2,600. That was about 5 or 6 years ago so about £3k in today's money. I've then spent, again in today's money, >£1k on 6 others. I still own all but 2 of them.
As a % of income what I spent on a second hand Rickenbacker bass in the early 80s is equivalent to >£9k out of today's salary.
I’ve spent over £3k on second had PRS’. I paid nearly £3k for a custom build. I’d spend more if the cash was around for something special. But I’d probably sell it, as I usually do!
My band, Red For Dissent
Thing is, I feel too precious about it and hate to gig with it, worried it'll get damaged or stolen.
Though I've set myself a vague limit of a grand, though prices have started to creep up of late. I bought and sold a CIJ jag for about £350 only a few years ago and now people are asking nearer £900.
These days I could afford a second-hand Gibbo 335 but, as has been said, the increase in quality/enjoyment probably does start to taper off.
At the end of the day I have separate the price/quality of the instrument from the quality of the playing and the music I'm making. It's only a small exaggeration to say if you're not going to sound good with an epiphone dot, you're not going to sound good with a custom shop Gibbo 335.
Moving up the Tele curve from a MIM to Am STD to AV64 was instructive - the Am STD was good, but the £1300 for the AV64 is money REALLY well spent. I did sell a Rickenbacker 330 for £1100 as a trade-up to get there. (Some regrets there, as it was a beautiful 2003 Blue Boy - lovely colour. Did anyone buy it from Wunjos about 4-5 years ago? )
In short the price point around £1K really works for me.