This Is How Much Money You Would Actually Save If You Made Your Coffee At Home
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It is easy to look at small purchases and say “whatever, it’s only $5.” As standalone instances, $5 for anything isn’t a lot of money. However, spending $5 every, single day on coffee adds up to be a lot of money per year. In fact, it’s $1,825.
How often are you saying, “whatever, it’s only $1,825?” Probably not very often. And if you are, you are hopefully rich and you can stop reading now.
For the sake making this as accurate as possible, we are going to use this calculator from Doug Boneparth, president of Bone Fide Wealth. Based on someone who drinks two cups of coffer per day, Boneparth’s calculator says you could save $1,500 per year just by making your coffee at home.
Making coffee at home isn’t free, but you could probably squeeze out even more savings if you A) buy your coffee in bulk and B) don’t mind cheap coffee. If you can’t do that, then you will just have to settle for $1,500 per year in additional savings.
So now that you know what you could be saving, what happens if you actually stuck to this new habit and invested that money? Spoiler: something beautiful happens. You build more wealth!
Let’s assume you throw it into a lazy 3-fund portfolio and make an 8% average return.
Ten years from now… you would have $22,868
Twenty years from now… you would have $73,627
And in thirty years… you would have $186,295
There have been arguments online that making your coffee at home won’t make you rich and you should focus on making more income. That is 100% true. Making coffee at home isn’t going to make you rich. But doing it creates a positive financial habit. One positive financial habit can turn into two positive financial habits.
Plus, most people would agree that an extra $186,295 in retirement could be helpful. Or maybe they would just say “whatever, it’s only $186,295.”