Here’s a story about a couple that didn’t realize the devastating effects that Starbucks was having on their financial freedom…

David and Janice are 65 year old retirees from Columbus, OH. They both have held stable jobs all of their lives. David worked in an advertising agency. Janice was a teacher. Every morning, David and Janice seemed to always be in a hurry. They had just enough time to get a shower, get dressed, and then head off to work.

They usually didn’t eat breakfast. However, they realized that they could save some time by stopping by their local Starbucks for a morning cup of coffee. David said he couldn’t start the day without a Mocha Frappuccino and Janice felt the same way about her Iced Vanilla Latte. Every morning before work, ever since they were 25, this had been their morning routine.

Now, David and Janice are retired and living off of their Social Security. They each get around $950 a month which is about the national average in America. It’s enough to get by, but they always wondered how much money they would have had if they were a little smarter with their money when they first got married.

Well, let’s see…

David and Janice said that the average cost of their morning trip to Starbucks was around $4.50 each (some days they would pick up a croissant with their coffee). They both went to work five days a week and didn’t bother with Starbucks on the weekend because they had time to make their own coffee.

($9.00 a day in coffee) multiplied by (5 days a week) multiplied by (52 weeks a year) multiplied by (40 years).

How much is that when you factor it all in? It’s $93,600.

But let’s say that David and Janice were really smart with their money. Let’s say that instead of putting it in the bank, they decided to invest it in an index of the S&P 500 which has had an average annual total return of 10% since 1926. Imagine what they would have had when they retired if they would have invested in it instead…

Their $4.50 morning coffees ended up costing them $2,160 a year. Here’s a chart of what they would have had over 40 years with their investment…

Instead of relying on their Social Security, they would have had a staggering $1,007,029!

That’s how much their morning cup of coffees at Starbucks cost them over the course of forty years. So, instead of buying a nice house and being set for life, they decide to save a few minutes and stop by Starbucks every morning. All they would have had to have done was allow an extra 15-20 minutes in the morning to make their own coffee. This small, morning luxury ended up costing them a fortune!

Are You Just Like David And Janice?

As you may have guessed, David and Janice are fictional characters. They were introduced to prove a point that little spending habits can have a huge effect on you over the long term. I mean that in both the negative and positive sense.

If David and Janice decided to put just $9 into their retirement, 5 days a week, they would have had over a million dollars!

Do you have a bad spending habit similar to David and Janice? Perhaps it’s not something that you are doing on a daily basis. Perhaps, instead of $45 a week going to frappuccinos, maybe you are eating out a time or two more than you should. Or, perhaps you find yourself spending a little too much on those weekend trips to the mall. Buying things that you really don’t need.

The point is, be aware of where your money is going and why. I’m sure David and Janice didn’t realize that they had spent over $93,000 at Starbucks. After all, to each person it was only $4.50 a day. But it’s the little things that add up over the long haul. Make a commitment today to take control of your finances. If you keep up the pace that you are on right now, does it lead to disaster or prosperity? Don’t realize it 10, 20, or 30 years from now. By then it’s too late!

You don’t want to retire with pennies in your pocket. You want a big nest egg that allows you to live the good life don’t you?

It doesn’t take a lot of money to become rich. It takes little commitments toward your spending habits on a daily basis. Get on a plan right now to start saving a few dollars a day. It might not seem like a big deal right now. But 30 or 40 years from now you will be glad you did!

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