That $5 a day coffee habit can delay retirement by up to 3 years.
Purchasing a $5 coffee from a coffee shop every day instead of brewing at home or drinking what is available at the office can not only delay retirement by itself, but it can give you ulcers realizing how much money and financial freedom you have guzzled down. Don’t do it! Instead, invest that $5 a day into an index fund, and at an estimated 7% - 8% return, your investment could swell to over $140,000 in 25 years. Use our investment calculator to see for yourself!
Daily investments are a great way to become a disciplined saver. In today’s world purchasing is easy, a quick slide of a card or a touchless payment via a phone, it can become an unconscious activity to quickly grab a coffee. Instead of succumbing to the convenience of buying your Joe from a barista, reward yourself for breaking the cycle and invest that $5 into an index fund every day that you do not purchase the coffee. You will simultaneously save and give yourself an active Wyse reward; the act of frequently moving the money into your investments will feel good! While $5 is a relatively small amount, regularly moving the money into savings will help engrain a Wyse mentality that will carry over into other unconscious spending habits. You will being to question all of your purchase and want to save in more areas!
Plan ahead. Look for opportunities to buy bulk coffee beans, experiment with different flavors and tastes, use pour over coffee makers with reusable filters to reduce costs further, and enjoy the process! While buying a coffee is easy, it isn’t rewarding in the Wyse sense, and the process of brewing and enjoying a cup of your own coffee becomes its own kind of treat.
With very little effort, a little planning, and by breaking the daily habit you can save an extra $140,000 for retirement, buy that new car with cash, or save for the down-payment on a house. You can also use that $5 to actively pay down debt everyday instead of investing if the math makes sense. Don’t fall into the convenience trap!