Save the Savings: the Latte Factor

I have been thinking about this for a few months now since I heard of David Bach’s “Latte Factor“. The idea of it makes sense and is easy to grasp, and I’m sure he’s not the only person to do this or the first one to think of it.

The point of this concept is to give up little things in the present in order to let them accumulate to something substantial in the future.

For most people it’s about tackling the daily unconscious spending: daily coffee or eating out for lunch. Mindlessly getting into a habit that over time is just a plain waste of money without adding anything of value to their life. Sure, for some people, that daily Starbucks is life, or they must have it because that’s where they meet clients.

For me, that’s not the case. for me, mindless, unconscious spending is about the idea, waste and habit of throwing away money.

No point is depriving myself of a well made cappuccino or going out for lunch with coworkers, but overdoing it a waste of my little salary. Too much of a good thing is bad thing right?

I am bad for spending mindlessly on coffee, eating out, random clothes/shoes, and we all know about my Sephora problem.. so I thought I should give this concept a practical run. I had trouble figuring out HOW I am going to bank the savings. The point is to put the money in savings, not spend it on something else.

So how I think I am going to do this is base the amount I save on each day that I do not spend on Restaurants or Stuff, then I will add up the amount at the end of the week and transfer it to my savings.

To do this, I went into my last 4 months’ budgets and calculated the average for each category:

Example: Restaurants: January: 138.07+ February: 109.35+ March: 277.81+ April: 224.23= 749.46 divide by 4 months = 187.37/ month.  Per Day: 6.04

So for each day I don’t eat out I will add it up and transfer to Savings.

I don’t see this going well if I just completely cut myself off, and that isn’t the point of this excessive. The point is discipline.

Each week I will allow myself to eat out once, and I’m also giving myself $50 Blow Money for the month. More on Blow Money later.

Something to help me stay motivated is putting a reward/goal in place. The item that I will be saving for is a makeup item and it costs $42.94:

At the end of the month, if I saved enough from not Eating out and Random things and staying within my allowed number, I will reward myself with this. I know that sounds like the opposite of what I said above: to not spend the money on something else, but this will act as the reason of why I will be forgoing not buying a pair of shoes in that specific moment. I hope that makes sense.


– In May I will only spend $50 on random stuff for myself and only eat out 4 times.

– Save the amount that would’ve gone to eating out and stuff. If I am successful, at the end of the month I will reward myself.

Please feel free to comment if you have any other suggestions or ideas of HOW I can “save the savings”,



8 thoughts on “Save the Savings: the Latte Factor

  1. I like the way you’re going about it, instead of cutting yourself off completely. I think of the saying “everything in moderation” when it comes to stuff like this. Eating out is something I struggle with, but it’s something my friends and I do when we’re together, so I try to cut back on the times I eat out alone and save it for social gatherings.

    Good luck!!

    Liked by 1 person

  2. I don’t know if a daily latte is a “little thing.” If you spend $5 per day on coffee for 250 days per year, you spend $1250 per year on coffee. Buy a $1 gas station latte instead, and you’ll have an extra $1000 at the end of the year. Do this for four years, and you’ll have enough to pay cash for a reliable car.


    1. Thanks for the comment/thought! I definitely agree! It makes such a difference. Coffee-namely Starbucks or fancy coffee places- is something I have been working on for a while, so I got my drink down to $2.04- which is an americano: more caffeine and a better price- sign me up! And I don’t even get one every day- maybe once a week. I hope that since I was able to control and change my habit over coffee, I will be able to do the same with eating out and my random impulse purchases.
      I’m glad you pointed out the $ amounts!


      1. I first started hanging out in coffee houses with a group of German graduate students in college while I was still an undergraduate. We would go to lunch, then spend about an hour at the coffee place near campus (gotta love the European lifestyle). I didn’t even drink coffee – I usually had a Snapple. I then went to Berkeley, which is like the coffee-house capital of the world with everyone sitting around, sipping on lattes and contemplating their navels.

        The Starbucks revolution really torqued me because they caused coffee to double in price and, worst of all, they got everyone using those stupid paper cups. It is such a stupid design that they had to invent a sleeve for it so you wouldn’t burn your hand holding it. A coffee house used to be a place you would go to sit and relax, complete with drinks in real mugs and glasses, not paper. Drinking a coffee in a paper cup is like going to a movie and paying full price, then getting a video to either take home or watch on your laptop in the lobby.

        The point of this rant, other than to vent, is that things like getting a fancy coffee should be something special you do in moderation and really take advantage of. Go in and ask if they have real cups (or maybe bring your own now). Sit down and play a board game. Don’t pay $5 for a paper cup and walk out the door. That allows you to both keep your spending in check and get your money’s worth.


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