Well, you’ve been told before: stop buying those lattes! You might listen. It’s good advice. The idea of the latte factor has been around for years. But many of us don’t always keep tabs on ‘our’ latte factor. Looking back over the years I can see that I’ve had many different latte factors; at times movies, belgium ale, video games, and most recently, wine.
My wife and I were surprised when we saw we were spending over $100 a month on wine for the house. Needless to say, we’re drinking a lot less wine this month.
It’s one thing to look at the latte factor as a means to limit an expense and be more frugal. But this is the Carnival of Investing not Frugality so I say take it one step further. Instead of not buying that smoothie, don’t buy it but earmark that $4 and invest it. Like any regular investing, over the years it can add up in a big way.
See for yourself, there’s a simple latte factor calculator on Oprah’s website.