Ever heard someone say, “Skipping your daily coffee can make you rich?” That’s the Latte Factor, a simple yet powerful idea that explains how small daily expenses can add up to huge amounts over time.

What Is the Latte Factor?

The Latte Factor was coined by finance expert David Bach to show how tiny, repeated purchases—like a $5 latte, daily takeout, or random subscriptions—can silently drain your money.

Example:

Let’s say you spend $5 on coffee every day. That’s:

• $150 per month
• $1,800 per year
• $18,000 in 10 years!

Now, what if instead of spending that $5, you invested it? With an 8% return, your $5 per day could turn into $80,000 in 30 years!

Why It Matters:

It’s not about never buying coffee—it’s about being aware of where your money goes. Small changes, like making coffee at home or cutting unused subscriptions, can make a huge difference in your savings.

How to Use the Latte Factor in Real Life:

• Track small, unnecessary expenses.
• Redirect those savings into investments or a high-yield savings account.
• Make spending intentional—ask yourself, “Is this really worth it?”

Final Thoughts:

The Latte Factor isn’t about giving up everything—it’s about choosing where your money works best for you. Small daily choices can add up to huge financial freedom.

So… what’s your “latte”?