Tuesday, February 8, 2011

Opportunity Cost ~ This Starbucks Cost Me What??????

During my nieces visit this weekend, I had the opportunity to talk about "Opportunity Costs." My niece was purchasing a gift for a birthday party she was attending and the jersey she was looking at cost $60. Did I mention the birthday was for a 5 year old who would likely grow out of the jersey next month? :-) Anyway, she seemed to be agonizing a bit over the price so I jumped up on my soapbox and talked to her about whether she wanted to make a contribution to Cardinal football player Tim Hightower's child's college education, or would she rather send her own son. She chose a $20 t-shirt.


What does that have to do with Starbucks? Nothing :-) Unless you are like my daughter and millions of others who love their daily latte. Financial expert David Bach calls it the latte factor. A couple of years ago, Brandi decided to add up the cost of her monthly Starbucks habit and was appalled to learn that it was $160 that month. She quickly cut back realizing that she could have purchased airfare for a California beach vacation.  She had mindlessly made it a habit to run through Starbucks on her way to work every day and hadn't realized what the cost was adding up to.

We tend to do that with a lot of things, don't we? Magazines, books, food, shoes, etc., fill our homes and our tummies, and give us a short term fix, or instant gratification which quickly fades and needs to be filled again. When we are patient, hold a vision for something greater and save for it, the reward is often much longer lasting. What could you be saving for now? What is your latte factor?

7 comments:

  1. I no longer buy a coffee everyday either... even tho Starbucks has always been a treat....I gave up my daily cappucino at work which only added up to about 28 bucks a month but I love having that extra $$ in the pocket.

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  2. When I work in the city.. cappuccinos are definitely my thing.. my addiction.. also.. driving to work and paying for parking.. but.. considering I was working 90hr weeks.. driving was saving me from total exhaustion.. so in that case the opportunity cost.. of getting home a bit quicker was worth it...

    Funny.. i am usually the one going on about this.. hahaha.. although somethings are worth it... Have a lovely week.. ciao xxx Julie

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  3. Hi, I'm your newest follower via Follow Me Back Tues. Hope you'll consider following me back J
    Malia
    www.yesterdayontuesday.com

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  4. I think the old cliche "Penny wise and dollar foolish" may fit a lot of us. I control spending on some little things and then go out and blow a bunch on something that is impulse buying. Go figure, huh???

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  5. One of my students, college age, recently quit smoking just for $$ savings factor!

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  6. It is crazy how much Starbucks is. I am tracking my expediture for the year. I am sure that when the weather gets warmer, so will my desire for a Caramel Frappucinno!

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  7. Kim ~ It is nice when we realize it really isn't a huge sacrifice.

    Julie ~ Some things are worth it and I love the little Keurig machine my step son gave me for Christmas...I thought it would help me tame the beast...instead the variety was like fueling a fire. Hopefully the novelty will wear off soon.

    Malia ~ Thanks for visiting. I will definitely check out your blog.

    Manzanita ~ Always a pleasure. I know, huh??? :-) I guess we just have to have that "Big Goal" tatooed on our hand!

    Brenda ~ Quitting smoking has its own benefits that far outweigh the $$ savings. Great for your student. Thanks for stopping by.

    Carmie ~ I remember your post on Starbucks raising prices. I just discovered Frapps this year. Oh how dangerous they are! ☺

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