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May 15, 2009


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I don't know anyone that gets 3 latte's a day. Maybe thats common but not with anyone I know. Thats a lot of caffeine and a lot of trips to Starbucks. And the $5 cost is at the high end for a large fancy drink in my experience. So 3 x $5 daily seems more like a worst case scenario to me.

For most people the Latte factor isn't a important as Mr Bach makes it out to be. In our current financial crisis when individuals are losing 100,000's of home equity and retirement savings, I rather enjoy a $5 coffee every now and then. Life isn't an excel spreadsheet. For most individuals those savings never completely add up. They would be better off cutting their housing and transportation expenses which tend to make up the majority of their budget.

It's not about the latte! It's about our own habits that make holes in our wallets.

I used to have 3 lattes a day (in addition to a bought breakfast & lunch) but I now have breakfast at home, I bring my lunch to work & I've cut back to 1 latte. I figure this is still a huge savings, and man I savour that latte.

In a way it would be good to be someone that bought 3 lattes as day because it would be so easy to make big savings. As I already take me lunch to work and use a free (not very good!) coffee machine there it is not so easy to trim my budget :)

I agree, it's not really about the latte. Learning to cut out bad habits can sometimes be a hard pill to swallow.

The point of the latte comparison is to show that it is habitual thoughtless spending that causes money shortfalls, not the big ticket expenses that even the spendthrifts among us usually sweat over. I think this point very much remains valid.


The "latte factor" idea is what introduced me to money management. While growing up, my parents tried to protect all the kids from money issues and "let us be kids." We grew up with little insight into finances and had to figure out everything on our own. In other words, our relationship with money was mostly defined by advertisers and pop culture.

It wasn't until I actually tracked spending and cut my daily latte out that things really clicked. Since then, the whole idea has snowballed and impacted a wide range of ideas about money and my overall behavior.

Is it still relevant? To me, yes. It was my gateway into better habits and is still my anchor when making financial decisions.

Everyone has their own version of "the latte." It might be your pack of smokes, or maybe it's the latest new comic book or Oprah magazine. The point is just to question all those small purchases and see how they add up. Maybe you don't really like the idea that you spent $30 on movie popcorn in the last month, etc. etc.

Cutting small costs on things you can live without is always a good idea. Whether you have three or two or one, a penny saved is a penny earned.

One thing about living in a town of less than 500 without a handy convenient store -- i make very few "nickel and dime" type purchases. most of my spending is in a huge chunk - the one day of month when i drive into town to stock up. this makes controlling finances pretty easy.

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