How much is that latte really costing you?

We love our coffee, don’t we?  In fact, according to a survey done by Accounting Principals in 2012, the average American spends $1,092 annually on the beverage.  That comes out to $2.99 per day, or about the cost of the smallest-sized coffee at you know where.

You say, “It’s only $3.00.  It’s no big deal!”  Believe me, I say it, too.  I look forward to my morning cuppa as much as the next guy!  Maybe more.  But check this out:  If you took that $1,092.00 and invested it every year in a vehicle that earned 3% interest, you’d have $29,342.45 in twenty years.  That’s at 3%!  At 8% interest it’s just shy of $50,000.00.  And that’s if you’re buying the smallest coffee each day!  Think about that number if you shell out $5.00+ a day.

I don’t tell you this to be a Debbie Downer, but the “little things” do add up.  And when it comes to lunch, 66% of Americans eat out for lunch as opposed to brown bagging it, according to the same survey.  This costs an average of $37.00 each week.  Applying the same math, that’s $1,924.00 in one year, which invested annually at 3% is $51,698.60 in twenty years.  At 5%, it’s $63,618.90, and it’s $88,046.02 at 8%!  That would go a long way towards the down payment on that awesome Mexican villa you’ve dreamed about all these years!

Even small adjustments can make a big difference.  Let’s say you decided to cut back on eating out for lunch to three times a week.  That would save you $14.80 a week, or $769.60 a year.  If you took that amount and invested it each year at a 5% return, you’d have $25,447.56 twenty years from now.

I’m not saying that you shouldn’t treat yourself from time to time, but think about those little financial tweaks you could make, and what a big difference they could make for your future.

You can use FitFin’s easy budgeting tool to help you set up a weekly or monthly budget for coffee, lunch, or anything you want.  You can set up a budget in about 15 seconds and then take about another 15 seconds to track an expense.  It’s a great way to watch where your money goes.  If you don’t already track expenses, give it a try.  It doesn’t take long to do and you might be surprised how each of those little expenses that seemingly don’t mean anything really can add up.

Check us out at http://www.fitfin.com.