Comments on: Why the “Latte Factor” Doesn’t Work http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/ Tue, 04 Oct 2011 00:10:26 +0000 hourly 1 http://wordpress.org/?v= By: Norah http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-80232 Norah Tue, 16 Aug 2011 21:00:05 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-80232 I love what Jason's mom said. Right on, Tamrie! By the way, I saved $5,000 in one year just by tracking my spending--every single penny AND by cutting back on those lattes, lunch out and a few other amenities (including travel). I also love spoiling people--especially my friend's grandkids (since I don't have my own children), and I discovered that I did not have to cut out sharing my love with them. I still buy and send 'little' gifts to let them know I care. Whenever a child is born, I send a $25 check to start their college fund. It will probably be worth the price of a sandwich by the time they are ready for college; but it's a great way to contribute to their future, and it makes me feel great! Jason, you have a very loving mom. You are very lucky. I love what Jason’s mom said. Right on, Tamrie! By the way, I saved $5,000 in one year just by tracking my spending–every single penny AND by cutting back on those lattes, lunch out and a few other amenities (including travel). I also love spoiling people–especially my friend’s grandkids (since I don’t have my own children), and I discovered that I did not have to cut out sharing my love with them. I still buy and send ‘little’ gifts to let them know I care. Whenever a child is born, I send a $25 check to start their college fund. It will probably be worth the price of a sandwich by the time they are ready for college; but it’s a great way to contribute to their future, and it makes me feel great!

Jason, you have a very loving mom. You are very lucky.

]]> By: Ricardo http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-80213 Ricardo Thu, 19 May 2011 22:45:08 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-80213 The latte factor is genius. The idea of skipping it isn't. The point of the latte factor is to help you save the money and use it for something better. I'm an avid supporter of splurging and wasting money but to do that you have to have money. I know that the partying is more fun when you spend and spend so to be able to do this you have to be stable. Bringing me to my point. The latte factor helps you find better balance in your life to the point where you can be a "baller" and make very little money. The latte factor is genius. The idea of skipping it isn’t. The point of the latte factor is to help you save the money and use it for something better. I’m an avid supporter of splurging and wasting money but to do that you have to have money. I know that the partying is more fun when you spend and spend so to be able to do this you have to be stable.
Bringing me to my point. The latte factor helps you find better balance in your life to the point where you can be a “baller” and make very little money.

]]> By: Sarah http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-80186 Sarah Fri, 31 Dec 2010 23:45:30 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-80186 The latte factor opens peoples eyes to what is needed and what is wanted. Sure, you can want a $4 coffee every day or a movie every week, or a dinner out. But if you can't pay your bills, then maybe you can "enjoy" those treats less. It amazes me how many people who don't have money for rent can manage to buy cigarettes or pay for a spiffy new phone with a $100/month bill. So many people who have trouble paying the utility bills, yet find the money for $130 for cable/internet.(Cable is NOT a necessity, Internet can be gotten for $40/month, IF you need it) Once you realize, that they ARE a treat, managing finances are a lot easier. Maybe cut it down to 50% of what you spend now. You still get your enjoyment, but you also get to retire something in the future. The latte factor opens peoples eyes to what is needed and what is wanted.

Sure, you can want a $4 coffee every day or a movie every week, or a dinner out. But if you can’t pay your bills, then maybe you can “enjoy” those treats less.

It amazes me how many people who don’t have money for rent can manage to buy cigarettes or pay for a spiffy new phone with a $100/month bill. So many people who have trouble paying the utility bills, yet find the money for $130 for cable/internet.(Cable is NOT a necessity, Internet can be gotten for $40/month, IF you need it)

Once you realize, that they ARE a treat, managing finances are a lot easier. Maybe cut it down to 50% of what you spend now. You still get your enjoyment, but you also get to retire something in the future.

]]> By: Bryan http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-80125 Bryan Fri, 23 Apr 2010 15:00:31 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-80125 Yes the little things in life do bring you pleasure, but I bet when your 70 years old and living on social security you will wish you would have saved then. The book does not say to skip ALL the little things , just a few . I dont drink coffee really but after reading his book I decided to have just $50 a month taken out of my paycheck and sent directly to a mutual fund and let me tell you , it does work! I am rich right now ? No , I am better off then I was 5 years ago ? Yes , if I keep doing this will I be better off? dont know , but a 50% chance of something is better than a 0% chance of nothing. This method is easy to do , but also easy not to. Do you want to look back 40 years from now and say " I wish I would have " Or " I am glad that I did" Because you will say one of the two evetually no matter what. Yes the little things in life do bring you pleasure, but I bet when your 70 years old and living on social security you will wish you would have saved then. The book does not say to skip ALL the little things , just a few . I dont drink coffee really but after reading his book I decided to have just $50 a month taken out of my paycheck and sent directly to a mutual fund and let me tell you , it does work! I am rich right now ? No , I am better off then I was 5 years ago ? Yes , if I keep doing this will I be better off? dont know , but a 50% chance of something is better than a 0% chance of nothing.

This method is easy to do , but also easy not to.

Do you want to look back 40 years from now and say ” I wish I would have ” Or ” I am glad that I did” Because you will say one of the two evetually no matter what.

]]> By: $$ http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-80074 $$ Fri, 12 Mar 2010 03:25:06 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-80074 The problem with the "latte factor" is how much the numbers are skewed by. People assume way to high rates or return on their money and keep them high even when close to retirement age. This is totally false as when we get close to retirement we need to bring down the levels of risk. I gauge a more accurate assessment of how much skipping latte's can actually save you here ... http://livinginvol.com/?p=6 The problem with the “latte factor” is how much the numbers are skewed by. People assume way to high rates or return on their money and keep them high even when close to retirement age. This is totally false as when we get close to retirement we need to bring down the levels of risk. I gauge a more accurate assessment of how much skipping latte’s can actually save you here … http://livinginvol.com/?p=6

]]> By: Bubba http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-80071 Bubba Mon, 08 Mar 2010 13:07:09 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-80071 The Latte Factor does work for those with common sense and discipline. Spending $5 per work day on coffee and snacks leads to spending $1250 per year on coffee and snacks. Save that money and in three years you will have enough for that big screen TV. Or you could wise up, buy a $150 TV, bring a thermos of home-brewed coffee and a lunch to work and use the savings for something worthwhile. The Latte Factor does work for those with common sense and discipline.

Spending $5 per work day on coffee and snacks leads to spending $1250 per year on coffee and snacks. Save that money and in three years you will have enough for that big screen TV. Or you could wise up, buy a $150 TV, bring a thermos of home-brewed coffee and a lunch to work and use the savings for something worthwhile.

]]> By: Ann http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-80060 Ann Wed, 27 Jan 2010 14:42:50 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-80060 You are both right and wrong. The way you save money is to live below your means, and save the extra. Period. That means...not spending $4 a day on lattes when you aren't saving enough in your regular and retirement savings... AND ...not spending hugs amounts on tech toys or anything else that is a luxury when you aren't saving enough in your regular and retirement savings! The techniques aren't mutually exclusive. What the latte factor was trying to teach americans was that our little daily expenses have crept up to a ridiculous high due to boom time luxuries like $4 lattes and $300 cell phone and $500,000 homes that we don't need. If you make 50,000 a year and save $10,000 a year, you're ok. If you make $150,000 a year and save $50,000 a year, you're ok. If you make $100,000 a year and save $1000 a year, or nothing, you are in trouble. A ten year old can understand it, we all just need to live it or risk losing our houses (duh) when the economy fails...or living in poverty in retirement. Wake up America, it's not too late. You are both right and wrong.

The way you save money is to live below your means, and save the extra. Period.

That means…not spending $4 a day on lattes when you aren’t saving enough in your regular and retirement savings…

AND

…not spending hugs amounts on tech toys or anything else that is a luxury when you aren’t saving enough in your regular and retirement savings!

The techniques aren’t mutually exclusive. What the latte factor was trying to teach americans was that our little daily expenses have crept up to a ridiculous high due to boom time luxuries like $4 lattes and $300 cell phone and $500,000 homes that we don’t need.

If you make 50,000 a year and save $10,000 a year, you’re ok. If you make $150,000 a year and save $50,000 a year, you’re ok. If you make $100,000 a year and save $1000 a year, or nothing, you are in trouble. A ten year old can understand it, we all just need to live it or risk losing our houses (duh) when the economy fails…or living in poverty in retirement.

Wake up America, it’s not too late.

]]> By: Summer Reading | Nadine Dajani http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-79816 Summer Reading | Nadine Dajani Thu, 21 May 2009 03:40:20 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-79816 [...] I hate to admit it, I’m a creature of habit. The “latte factor” (the theory that there a fortune lying hidden in our little, daily, needless expenses) [...] [...] I hate to admit it, I’m a creature of habit. The “latte factor” (the theory that there a fortune lying hidden in our little, daily, needless expenses) [...]

]]> By: Learning to be moneywise http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-79639 Learning to be moneywise Wed, 25 Feb 2009 10:07:00 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-79639 Well, I was reading David Bach's book that gave birth to the phrase "Latte Factor". Nowhere in the book does he recommend giving up on the small pleasures of life - like, forinstance, your weekend dinner with your wife. His recommendations have partly been covered in Gnorb's response. But the other big point that he makes, and that my parents always made, is that we should not live on credit (except maybe for the house) - no buying that Apple gadget with a Credit Card swipe that cannot be settled off in the next month's statement. Cutting small expenses help - they build savings to make those large purchases on Cash and not credit!! Well, I was reading David Bach’s book that gave birth to the phrase “Latte Factor”. Nowhere in the book does he recommend giving up on the small pleasures of life – like, forinstance, your weekend dinner with your wife. His recommendations have partly been covered in Gnorb’s response.
But the other big point that he makes, and that my parents always made, is that we should not live on credit (except maybe for the house) – no buying that Apple gadget with a Credit Card swipe that cannot be settled off in the next month’s statement. Cutting small expenses help – they build savings to make those large purchases on Cash and not credit!!

]]> By: Josh http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/comment-page-1/#comment-54241 Josh Mon, 04 Jun 2007 17:40:56 +0000 http://beancounterblog.com/2007/05/21/why-the-latte-factor-doesnt-work/#comment-54241 I completely agree. I recently had a similar realization. Why give up the little things that make life better, when I could just not buy a new car and keep driving my perfectly good old one? I completely agree. I recently had a similar realization. Why give up the little things that make life better, when I could just not buy a new car and keep driving my perfectly good old one?

]]>