latte factor

[LivingAlmostLarge]

Do you think if you cut all the fat or latte out of your budget it would make a big difference?

Now bare bones yes it would make a lot of difference for us but leaving in things that are part of our budget monthly wouldn't. Yes eating out but cable? We pay a premium to not be on a contract. Need internet for DH work so we couldn't cut that. And basic channels cost us $5 more. We can't switch so that's moot. Cut Amazon prime? $99/year. Don't have hulu or netflix. Starbucks or lunch daily? No. Neither on a regular basis.

That's the latte factor right? Or buying clothes? The stuff we can cut easily is groceries and eating out. But a daily indulgence?

Do you guys find you do? I also see people mostly having trouble with the mortgage or car payments. Way out of line with income.

[bjl584]

I've made some cuts on major things. And that's mainly where my focus is at. The little stuff? Eh.... All the bills get paid. My target amount gets saved. I figure I can live a little here and there.

[disneysteve]

Is the latte factor important to me? Not really. But do I think it's important for others? Absolutely. We make enough that we can afford those little indulgences. The problem is with the folks who don't make enough but keep living as if they do.

Let's say you go to McDonald's for breakfast every day and spend $6.
You eat out for lunch every day and spend $10.
On your break, you grab a coffee at the cafeteria for $3.
You have premium cable that costs you $150/month.
Every weekend, you go out to the bar and spend $100 on drinks and snacks.
You have Netflix and Hulu, Amazon Prime, subscriptions to 2 or 3 magazines, a gym membership that you never use, and various other recurring bills, memberships, and subscriptions,.

It isn't hard at all to be into that stuff for $12,000-15,000/year. Now if you make $200,000/year, it's probably no big deal. But what if you make $60,000? Then you become the person coming along and saying, "I can't afford to save for retirement." "I can't afford to pay off my credit card bills."

The latte factor probably isn't a big deal for most of the regulars here because as a recent poll showed, we generally have incomes well above the median, but we are not the average Americans who struggle with this stuff.

[disneysteve]

I realize that smoking is an addiction and isn't so simple to give up like a daily coffee is but....

I saw a patient who told me he ran out of his blood pressure medicine 2 weeks ago because he hasn't had the money to get the refill. But he smokes a pack a day. So somehow he can afford that but not his medicine. There's a guy for whom the latte factor is huge. Even cutting back to half a pack a day would free up $120/month at $8/pack. That would cover his BP med for a year.

[phantom]

I don't have much fat in my regular spending habits. I have something of a natural aversion to spending that prevents most small spending, especially the sort of spending I can imagine becoming a habit, like a daily latte. In fact, I think it's the extrapolation of "What would happen if I said yes every time a spending decision like this one came up?" that leads me to say no to a lot of small spending decisions.

If I overspend anywhere, it's definitely on the big, one-time spending decisions. Once I decide I'm spending money on something, it's far easier for me to decide to spend a little more than it would be for me to decide a little money instead of no money at all.

I think it's useful for anyone who has a regular spending habit with the potential to add up over time to at least consider the latte factor. When you're constantly making little purchases, they can definitely add up. But, it really matters how big those purchases are relative to overall spending and income and how many of them there are.

[~bs]

there's the latte factor, and there's the water factor.

A latte is an indulgence that will quickly add up in cost over time. So yes, it will make a difference to cut latte type of spending out of your life. Water on the other hand costs very little, but is important to your physical and mental wellbeing. You can attempt to cut spending on water out of your life by showering less often, drinking less water, reusing dirty dishes, flushing every other other time you go potty. Yes it will save you some money in the long run, but you need to ask yourself, is the sacrifice really worth it?

Moral of the story is to not go overboard with your frugality. Cut the latte out, but don't cut the water.

--------------------

I used to get take out food daily, 3 meals a day. That can quickly add up to $20-30 on food per day. Nowadays I cook my meals, generally more nutritious, and much much cheaper. My meals probably cost me $4-6 per day. That is a huge difference that incrementally might not seem like much.

[PeggyHefferon]

there's the latte factor, and there's the water factor.

A latte is an indulgence that will quickly add up in cost over time. So yes, it will make a difference to cut latte type of spending out of your life. Water on the other hand costs very little, but is important to your physical and mental wellbeing. You can attempt to cut spending on water out of your life by showering less often, drinking less water, reusing dirty dishes, flushing every other other time you go potty. Yes it will save you some money in the long run, but you need to ask yourself, is the sacrifice really worth it?

Moral of the story is to not go overboard with your frugality. Cut the latte out, but don't cut the water.

If it is yellow let it mellow... Just kidding

I do agree with you on the surface, but I am a believer of "every little bit helps." So I always have tried to avoid the daily "latte" type expenses as well as turning off lights not needed, quicker showers, etc.

[MonkeyMama]

I think that the little things add up to a lot, over time. But my interpretation has always been to just be more conscious of spending that is often very mindless. It's not that I would never indulge in any small/frequent expense.

As to something like eating out. When we both worked full-time, we ate out all of our meals. We were able to save 50% - 70% of our income. I can't fathom why on earth I would have had any motivation whatsoever to cut costs or evaluate spending.

When we had two children and cut our income in half (to stay home with kids) we had no large expenses, so food spending was really the only thing we could do much with. We began home cooking all of our meals and managing our costs from that angle. Fast forward several years and we have two teenage boys now (almost). If we ate out every single meal, this would easily be our biggest household expense; twice as much as our mortgage payment. I mean, this would be our BIGGEST expense, by a LOT.

Depending on the circumstances, something like this could be big or small.

[97guns]

My brothers girlfriend gets a latte 1.5 times a day, around 10 times a week for $45. costs her $180 a month, $2160/yr

[MonkeyMama]

My brothers girlfriend gets a latte 1.5 times a day, around 10 times a week for $45. costs her $180 a month, $2160/yr

Are you saying that it is $4.50 for a latte? I guess the other thing I didn't mention in my last post was that I am not a fan of paying for over-priced items, especially *every single day*. Surely there is a cheaper alternative that is just as good. I couldn't imagine paying $4.50 once or twice a day for a beverage.

(I am not a coffee drinker, so I am oblivious as to the cost of coffee).

[frugalninja]

$4.50 isn't unheard of but I agree, that's far too expensive to be buying 10 times a week. I occasionally spend around that on a smoothie but no way would I make it a daily habit.

[disneysteve]

Are you saying that it is $4.50 for a latte? I guess the other thing I didn't mention in my last post was that I am not a fan of paying for over-priced items

That's how we are. I rarely even get a drink when we go out to dinner. I'll just get water. I can't stand paying as much for a glass of soda as we pay for a 12-pack of cans at the store. And alcohol prices are even worse - $10 for a cocktail that I can make for $2 at home.

I'm not a coffee drinker but my wife is. She uses our Keurig and much of the time doesn't even use the pre-filled pods because they cost at least 50 cents each. She uses the little gizmo that you fill with your own coffee. When she does use pre-filled pods, she's found that Wegman's store brand is good and in the big box, I think it's only like 35 cents each. She thinks the people that go to the coffee shops every day (or multiple times per day) are nuts.

[97guns]

For a while my wife and I were getting it every or almost every day, I just get a brew coffee and she gets her foo foo drink and it's $8+, we've cut it down to around once a week

[97guns]

Makes me want to buy Starbucks stock

[PeggyHefferon]

Not a coffee drinker but I do like soda when I dine out. Hate the cost compared to buying it at the store, but I indulge because I don't dine out regularly.

So thankful I never liked coffee.