It’s not about the latte
Personal finance people love to talk about “the latte factor”—the currently popular concept that we all spend money on lots of frivolous stuff all the time, and if we would just skip the daily latte and put that money into good investments instead, we’d all be gazillionaires. (It’s possibly I’m exaggerating their position just slightly…)
In case it’s not obvious, I’m not entirely sold on the logic. Lattes might be frivolous, but they’re not that expensive in the grand scheme of things, and I’d rather spend my time thinking of creative ways to add ten or twenty-thousand to the bottom line than feeling perfectly satisfied because I managed to deprive myself and save a tenth or a twentieth of that.
But I don’t think the concept is useless. I just think many folks don’t use it to its full potential (and I’m not talking about giving up all caffeine).
I have a one-year-old, and for the first nine months of his life, Benjamin would periodically go from crying into full nuclear runaway. It was if, once he got to a certain point down the meltdown path, he couldn’t turn aside, and his unhappiness turned to panic. If we couldn’t calm him down before that point, there wasn’t anything we could do.
Until we discovered the pantry.
There is nothing magical about our pantry, at least not to our adult eyes. But when we carried Benjamin into the pantry and faced him toward the shelves of colorful boxes and cans, suddenly his panic stopped and he would just stare in wonder (okay, more likely, over-stimulation—but he calmed down).
We called the pantry “the interrupt switch.” Even though it was irrelevant and did nothing to address whatever originally started him crying, it was like it created a fork in the road and he was able to stop the downward spiral.
That’s what I think the latte factor is good for.
In and of itself, giving up a latte is probably not going to take you from rags to riches. But consciously giving something up, particularly something that’s part of your daily routine, is an interrupt switch of sorts.
If you just give up the latte or cable TV or the unlimited text plan or whatever your particular “latte factor” is, and you feel like you’re done, you’re missing the main benefit.
What if you were able to use the sacrifice as an interrupt that kept your valuable, meaningful goals at the forefront of your thoughts? That could be the difference between staying motivated and just another good intention. What if it helped you shift away from the attitudes that have been slowly pushing you downward, and helped you focus on a better alternative?
That might be worth the latte.
photo credit: josh.liba
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Very true, I gave up my phone line and opt for prepaid..and now I have an additional savings.
Hey there,
I guess this point of view is quite interesting. Although right now, I don’t think that I would live without my coffein in the morning *g*
Oh, so true! Drinking that latte while you are actually taking a time out from your busy day can be important. I don’t think we have to be Spartan in our frugality. However, if you are in debt over your ears and it is dragging you down, giving up that latte or at least some lattes and using that money to pay down a credit card could give a real mental boost.