I've been drinking the coffee at work for years. It's $0.75 per cup, it isn't very good, and does not claim to be environmentally or socially responsible. I was thinking about it this morning and realized I am probably not getting a very good deal except for the convenience of not having to make the coffee or clean the machine.
According to http://www.quartermaine.com/coffees/faq.html I can make about 40 five ounce cups of coffee with a one pound bag of coffee. It's about $8 per pound for the coffee I drink at home. I think my cup is more like 10 ounces so let's say I get 20 cups for $8. 8 / 20 = $0.40 per cup (and it's a lot better quality).
If I was truly extreme I'd just quit drinking coffee since it's decaf anyway but I do enjoy it.
Coffee Cost Calculations
Re: Coffee Cost Calculations
So back in 2005 I noticed this poster in our break room from our 401k administrator that showed a plot of saving $3 a day (or something like that) by bag lunching or not drinking a Starbux latte on the way in. It would go to some number like $30,000 by retirement at some fantasy rate that they could never give you over the long term. My coworkers quoted this poster at lunch while they discussed wealth and retirement.
Back then $3 seemed like pocket money to me. Now $30k doesn't sound like much, especially if I have to wait another 20 years (poster assumed retirement at 67) to get it.
I'd focus on magnitude not frequency. People obsess over smartphone bills, latte, lunch and then they go out and get a loan for a home and lose tens of thousands in short order. The latte is noise. Maybe not for you and other ERE folks, but for typical folks it is a drop in the bucket compared to their cars, homes and vacations...or investment losses.
Back then $3 seemed like pocket money to me. Now $30k doesn't sound like much, especially if I have to wait another 20 years (poster assumed retirement at 67) to get it.
I'd focus on magnitude not frequency. People obsess over smartphone bills, latte, lunch and then they go out and get a loan for a home and lose tens of thousands in short order. The latte is noise. Maybe not for you and other ERE folks, but for typical folks it is a drop in the bucket compared to their cars, homes and vacations...or investment losses.
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Re: Coffee Cost Calculations
However, if the number of individual noises is large enough, the combined effect can be deafening.
http://earlyretirementextreme.com/your- ... -ship.html
Otherwise, the Pareto principle applies.
30% of a normal budget is spent on housing, 20% on cars, and 15% on food, which is why most ERE focus is officially here (since 2010 anyway). Minor changes in these categories handily beats most "frugal tricks".
http://earlyretirementextreme.com/your- ... -ship.html
Otherwise, the Pareto principle applies.
30% of a normal budget is spent on housing, 20% on cars, and 15% on food, which is why most ERE focus is officially here (since 2010 anyway). Minor changes in these categories handily beats most "frugal tricks".
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Re: Coffee Cost Calculations
I spend about 365 * $0.75 = $274.75 per year on coffee. Just for an experiment, I'm not going to drink coffee at work next week. I'll post the results in my journal.
Re: Coffee Cost Calculations
Have to agree with Sclass and jacob. Also, I think MMM commented in a blog post that he would have not fretted the occasional indulgences of coffees or craft beers pre-FIRE.
I think MMM's recent post, with the bar graph sketches, was not telling the whole truth. If I weren't on the beach right now I would take it to mspaint and make it more accurate, it's related to what we're saying here.
As for me, I buy $5 coffees, teas on a pretty regular basis. Other food and drink indulgences as well. Albeit, my budget is like 1% housing/complementary costs and 6% auto.
I think MMM's recent post, with the bar graph sketches, was not telling the whole truth. If I weren't on the beach right now I would take it to mspaint and make it more accurate, it's related to what we're saying here.
As for me, I buy $5 coffees, teas on a pretty regular basis. Other food and drink indulgences as well. Albeit, my budget is like 1% housing/complementary costs and 6% auto.
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Re: Coffee Cost Calculations
@GdP - The thing I don't understand is why/how you spend a whopping 75c/cup at work? Do you belong to a coffee club? Are the admins getting rich?
Re: Coffee Cost Calculations
Yeah, right. You need to flip this upside down and have a fresh pot brewing at your desk for $0.25 a cup. Now you get your coffee for free and you get quarters for the laundry.
I have to recalibrate what I consider noise. its a slider that changes over time. $1000 a year savings after taxes can mean a lot depending on circumstances.
Investment losses are my big expense this year. I bit it in iron ore and oil. I think I'll go to Peets and get something sweet to feel good.
I have to recalibrate what I consider noise. its a slider that changes over time. $1000 a year savings after taxes can mean a lot depending on circumstances.
Investment losses are my big expense this year. I bit it in iron ore and oil. I think I'll go to Peets and get something sweet to feel good.