The Real Cost of Your Morning Coffee – and Other Items

Coffee is America’s lifeblood. Workday, weekend, or vacation, it really doesn’t matter – nothing gets done until people have had their dose of caffeine. Most of us are introduced to coffee in our high school or college years when life seems to “get real” and teachers and professors begin assigning homework, projects, and tests at an alarming rate. It’s almost as if they each think that we only get work from them. Combined with work, and trying to maintain a healthy social life, coffee almost becomes a necessity if you want to stay awake for all of it. Lucky for us, in moderation, most consider the beverage relatively harmless – to our bodies that is. Unfortunately, the same can’t be said for our wallets.

How Much Does Coffee Cost – Really?

Taken at face value, a cup of coffee isn’t expensive at all. Typically, you can find a solid cup for about $2-$3. Willing to spend slightly more? You can usually get a better cup, with all of your fixins’ (like that annoying Starbucks Trenti iced coffee, 12 pumps sugar-free caramel, 5 pumps skinny mocha, a splash of soy, coffee to the star on the siren’s head, ice, double-blended coffee) for about $5-$6. Not a large sum considering that rent can hover between $1,000 and $2,500 per month, depending on where you live. However, if you start to think about the total you spend over the course of a week, then extrapolate that to a month, a year, or over a career, the sum can be massive. Assuming that over the course of your career you opted to drink the free office coffee instead of the the one from your favorite coffee bar, and that you both saved and invested all of that money, you could potentially have an additional $300,000 when you finally decide to “chuck the deuces” to your employer for good. Typically order a baconeggn’cheese as well? Combined, you could be missing out on nearly a million dollars of the course of your career, depending on how long you decide to work. The chart below summarizes just how much some of our most common spending habits could be costing us in the long run:

While most of us probably don’t spend quite this much, or engage in these activities as often as shown, we probably fall somewhere in between – and while we may not necessarily be missing out on $6.4 million, as shown above, we could very well be tossing away one, two, even three million dollars without giving it a second thought. The scary part is that this doesn’t even encompass all of our likely habitual spending. Things like haircuts, manicures and pedicures can add up quickly as well. Again, most of us will fall somewhere in the middle of this range, but it can be helpful to visualize just how much all of these things could potentially be worth in the future.

But I Still Need to Live Now – What Should I Do?

This is very true. Life is short, and you should do everything that you can to make each day as enjoyable as possible. However, there is a caveat – while life is short and we want to live as comfortably as we can in the present, it isn’t so short that we can completely neglect the future. What good would it be to live extremely comfortably now, but have to work forever, or live in poverty after retiring? Sure, it would average out to a decent life, but I don’t think this is a case where an average would tell the whole story. After graduation, I remember talking to friends about saving and investing and they would often say “but, what if you don’t live that long?” and each time my response was “but, what if I do?” The latter scenario, outliving my funds was far more frightening to me than the opposite. So what should we do? The key is to find some middle ground, where maybe we aren’t maximizing our comfort now (yet, still living comfortably), but at the same time, we aren’t ignoring the fact that (hopefully) we’re going to be here for a while. See some simple examples of how to do this, below.

Coffee

This is a simple fix and possibly the easiest on the list because it requires almost no skill. Before Starbucks existed, and before America [ran] on Dunkinpeople actually brewed their own coffee at home and brought it with them, and you can do the same. You can get a good coffee maker, a thermos/carrying container, and everything else you’ll need on Amazon at a good price. You can even brew iced coffee if that’s your preference. Try brewing your coffee at home on Tuesday’s and Thursday’s, and visiting your favorite coffee spot only on the other days. Eventually, flop the pattern such that you buy coffee fewer days than you brew your own. Experiment and find the pattern that works for you, and don’t worry about the cost of the coffee maker, etc. – it’ll more than likely pay for itself in the first month of use.

BaconEggnCheese

Try keeping instant oatmeal and a bowl at your desk. You can often buy this in bulk for between $5-$10 per box, and it will likely last you at least a week. The biggest complaint I hear about this is “Well, that isn’t healthy because it has so much sugar.” I’m sure the daily breakfast sandwich is just what the doctor ordered up too! Also, instant oatmeal is only as unhealthy as you make it. Sugar is the main culprit here, so opt for the “less sugar” varieties. Even better, buy the plain instant oatmeal and a small bag of brown sugar to leave at work. This way you can add as much or as little sugar as you find appropriate. I’m probably somewhere in the middle, opting to mix one pack of sweetened oatmeal with a pack of unsweetened, plain instant oatmeal. Try limiting the breakfast sandwich to just Friday mornings.

Lunch/Dinner

This will be one of the toughest habits to change because it requires a significant amount of effort on your part. Obviously, very few of us are willing to completely eliminate eating out. Not only is it fun to try new dishes, but it often saves time, and is an important part of our social lives. Try setting aside a few hours on Sunday to make slow cooker meals that take little effort, and that can last a few days. Chili and stews are perfect for the winter. Obviously the more the better, but even limiting the number of times that you eat out by just a few meals can go a long way towards increasing your savings.

Beauty/Hygiene

This includes things like haircuts, manicures, pedicures, etc. Cutting these things out completely is probably an unrealistic expectation as they have become interwoven with our social lives. For instance, I have a great relationship with my barber and look forward to hearing about the progress his children are making in school, in sports, and in the other aspects of their lives. Others may enjoy meeting up with friends at popular nail salons before a night out on the town. That said, spacing out visits should be doable. Try reducing these visits by half, and use Youtube to learn to do these things yourself. You’ll likely find them difficult at first, but you’ll get better and faster over time.

Hopefully, you’ll be able to implement some of the ideas above to jump-start your saving and investing. Remember, the key isn’t to eliminate everything, rather reduce your spending to the point that allows you to remain comfortable and plan for the future.

As evidence that we can all use a reminder from time to time, I wrote this while drinking a tall, blonde iced americano from… you guessed it, Starbucks.