I got this question from a reader the other day: “I always see a lot of personal finance advice sites tell people to give up their daily lattes in order to save money. If I really love iced lattes and they help me through my day; does it really make that much of a difference in my bottom line?”
The quick and easy answer is “Yes, of course it does”. A Starbucks Iced Latte costs about $3.50 and if you are getting one every day of the work week (5 days a week), that adds up to $70 every month just for a cup of milk and espresso. To take it even further, you can look at it over time…$70 X 12 months X 5 years = $4,200. That is a healthy hunk of change for almost everyone, considering that it is a nice down payment on a car after a few years. But what if you really need that latte and consider it a necessary evil to help you get through your day?
Try making them yourself.
To make an iced latte, you need 3 things; ice, milk and espresso. Ice is free, so we can take that one right out of the equation. Milk is about $4.00 per gallon the last time I even looked at it; we drink soy milk so I don’t know the exact price. But a gallon of milk would last quite some time if you were just making lattes every day with it. Add in the price of a bag of espresso beans at $9.00, and you probably have enough supplies to make at least 10 lattes for $13, or $1.30 per latte. I could be a little off on my numbers here, but I am close. That is a savings of $2.20 per latte, which by using the same math as above, saves you about $2,640 over 5 years. Not bad, really.
A latte is such a simple drink that you can make them at home and they will taste almost exactly the same as the ones at the store and cost you so much less. Step one, make some espresso. If you don’t have an espresso maker, there are very inexpensive ones available that work fine, like this one at Target. Ours works great and was not that much money. It takes about 3 or 4 minutes to make 2 espresso shots. While that is brewing, fill up your travel mug (you are going to work, right?) halfway with milk. By now, the espresso shots are ready, so dump them in your mug. Fill the rest of the space up with ice and stir. There you go, a homemade latte that costs at least $2.20 less than the one at Starbucks. Plus, you are saving the environment from one more plastic cup to deal with, and you can choose the type of beans and milk that you want to use.
I don’t see a problem with someone spending money on lattes if that is their thing, but making them at home gives you much more control over what you are drinking and can save you a ton of cash. Try it out for a week or two and see how easy it is. In fact, if you do it, pocket the money you would have spent every day and buy yourself something nice as a reward…but be sure to start putting that extra money somewhere more important than into your stomach!