How much does that Starbucks cost?
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How much does a daily trip for a drink at Starbucks really cost you? Prices vary around the country, but lets assume the price of regular iced coffee is $2.30. Everyone loves Starbucks iced coffee, right? My personal favorite is the Vanilla Ice Coffee With Half and Half! What is your favorite? Have you considered how much it really costs you over the long-term?
If you drink one cup per day for a week it will cost you $16.10 weekly, about $69 per month and $839.50 per year…. ok, that didn’t hurt too badly.
WHAT if you do that for 10 years, does it then cost $8,395?
Ouch, that hurt a big more. BUT, what is the real cost? I am sure you could have invested that $839.50 per year and earned 10% interest.
Hmmm….
with annual compound interest at 8 % for 10 years, that simple ice coffee actually
COSTS: $14,717.41
Now, you calculate that cost for 20 years and leave me your answer in the comments section!
That 20 year number will truly be SHOCKING!
Ouch, now that IS harder to swallow so may your drink choices wisely and consider that next time you spend the $2.30 for the cup of iced coffee. NOW, I am not saying to NOT treat yourself to coffee…
BUT, what is the real cost of the things we like to buy?
If you buy a house for $125,000, finance it at 4% for 30 years how much does it cost you?
What is the total amount financing interest paid on that house, over 30 years?
$261,711.88 I know your monthly payment is SO affordable that it is hard to believe a bank could make this much on YOUR mortgage at such a low interest rate. See why people love to lend money?
The return on investment is GREAT!
I AM saying, be sure to invest in yourself and become financially literate and think about all your choices! Should you buy a car at zero percent interest?
How can you apply these concepts to daily decisions on what you choose to drink, insurance you choose to buy and the investments you make!
Learn to understand compound interest!
Learn the difference between liabilities and Assets!
The difference between equity and cash flow!
Next time you head to Starbucks, be sure to stop and think about How Does Starbucks Cost?
Think about the total cost, including how often you go, how much you spend at Starbucks and what the lifetime effect including compound interest will be.
What are your thoughts? Leave me questions and comments and consider sharing this posting!
Jim Ingersoll
