We’ve all heard it before. Give up your daily coffee and suddenly you’ll be able to afford to buy a house. David Bach coined “The Latte Factor” and popularized it as the financial lesson for everyone from baby boomers to millennials.
As annoying as it can feel to be on the receiving end of the latte speech, there is some truth behind it.
In 2018 the average American spent more than $1,100 a year on coffee. Even if you just cut that in half and invest the difference, in 10 years you’d have nearly $8,000 — and that’s still with spending $550 a year on coffee.
So no, cutting your daily latte isn’t going to get you a house anytime soon, but it does show that while small spending can add up to significant amounts, the small savings can add up just as fast — if not faster, thanks to interest.
Listen, if you love your morning latte and it brings you joy that you don’t think you can get in a more efficient way, then you get that latte, savor every sip of it, and don’t let anyone else tell you otherwise. Use your money to maximize your happiness.
But, if the only reason you’re getting coffee out is for the “convenience” then you may want to think again.
I put convenience in quotation marks because if you’ve ever stopped at the Starbucks drive-thru line on your way to work, you know it doesn’t save you any time — and by the time the drink is in your hand you might be ready to pull your hair out.
At least that’s how I feel.
Half of the time I get coffee on my way to work, I don’t really love it and I end up throwing half a cup of coffee away by the afternoon. It always seems to be too sweet, too bitter, or too…something. But making my morning cup myself means I get to make it exactly to my liking.
Last year I spent just over $100 on coffee and tea out ($8.30 per month on average).
My morning coffee (or tea) routine is one of my favorite luxuries during my day.
Making my own drink every morning has become the anchor of my morning routine. I savor the peaceful quiet of the morning, pierced only by the abrupt, loud sound of my coffee grinder as it grinds fresh, whole beans shipped in from my favorite coffee shop in North Carolina.
We just make regular drip coffee, but we keep a hefty stock of high-quality whole beans from some of our favorite roasters. Most times when I have tea, I stick with a traditional English breakfast tea (I buy bulk boxes of PG Tips on Amazon) with milk and sugar, but we also keep a stash of fancier varieties of loose leaf tea from a local tea shop for when I’m feeling pinkies-up-fancy.
Even with all of this decadence, making my morning beverage of choice at home saves me a lot of money each month. Not to mention the fact that I find it way less stressful.
It takes less time than stopping on the way to work because I set the coffee machine up to start brewing before I start getting ready. There’s no chance I’ll get stuck in line behind the kind person who is ordering for half of their office. By the time I’m dressed, the coffee is ready to pour or the kettle is already boiling. Plus, this way I actually get to sit and enjoy my hot, caffeinated beverage while I do my daily YNAB review, read, or write.
In the summer, I have a glass pitcher that I can brew ice coffee in. I’ll make a new pitcher every couple days, so it’s ready for me in the mornings as a refreshing pick-me-up.
I attribute a large part of my enjoyment of this morning routine to my coffee bar setup. I love my coffee bar. We bought it at a thrift shop, sanded the original finish down, and painted it. It always feels like it’s greeting me in the morning and wishing me a splendid day.
An important part of creating any new routine is figuring out a way to make the start of the routine an inviting experience. My little coffee corner does just that. It’s aesthetically pleasing, has everything I need where I need it, and even prompts me to consider how I’ll cultivate joy that day.
If you’re trying to break the habit of frequently buying coffee out, try to make a coffee corner in your home that feels inviting. Set out your favorite mug the night before, prep the beans in advance, or leave a motivational note or positive greeting on top of your coffee maker.
And again, if you love your local coffee shop and aren’t willing to part ways with their special handcrafted morning brew, you don’t have to. There isn’t anything morally or financially wrong with buying a latte as long as it brings you joy.
Maybe you decide to reduce your visits (making them feel even more special), or instead, take a look at your overall spending to see if there’s another small, frequent expense that adds up to more than you’d like. See if you can find a way to shift your routine to get the same feeling you’re after for less.
Because at the end of the day, The Latte Factor isn’t actually about lattes, nor is it about depriving yourself. It’s about being conscious of the little things that add up without you realizing it and prioritizing your spending to maximize your happiness.