I stopped buying Starbucks. Not because I don’t like a nice, hot cup of coffee on the way to work in the morning. Not because I am no longer a hopeless caffeine addict. Not because I think my homemade brew is just as good (let’s be honest, it’s not). I quit because I want to save money. I quit, and you should, too!
I like math, so let’s do some simple math. If I buy 1 cup of coffee at Starbucks 3 times per week (because I only go on:
- Monday – since it’s the first day of the week and I deserve a little treat,
- Wednesday – because I made it halfway though the week, and
- Friday – because the week is finally over)
and assuming I take two weeks of vacation a year, I’ll have spent $600 on coffee.
$4 per cup x 3 times per week x 50 weeks per year = $600
Maybe that doesn’t really seem like a lot of money, but let’s assume that instead of buying coffee, I put that $600 in an IRA. If you made no additional investments, my money would grow to $1,627 (assuming a 5% return) in 20 years.
If I continued to add an extra $600 coffee money to my IRA every year, in 20 years, I would have a over $22,000 (again, assuming a 5% return), which is more than the average American has saved for retirement (link).
In closing, think before you drink. I still drink way too much coffee, but instead of shelling out my hard earned money at Starbucks, I got a single serve coffee maker (not a Keurig because I can’t stand the associated waste and cost–more on that another day), and I buy ground coffee at the grocery store. This saves a significant amount of money and I still get my caffeine fix to start my day.