Why Live In Debt

WLID: The Daily Grind, Common Sense Ways To Reduce Expenses

Do you have the will power to your reduce expenses? I’m sure if you have been following my blogs about financial freedom, and eliminating debt, and if you looked at the title of this blog you most likely are thinking I’m going to talk about your job and trading time for money. Or you might think I’m going to talk about going to work day after day, and living pay check to pay check and never really building wealth or getting ahead. Although these are all great subjects that I have briefly talked about in my past blogs, you are going to be pleasantly surprised at the true nature of this blog.

In this blog I’m going to move away from the how and why we get into debt, and move into some more practical tips that you can start using now to exercise your new debt free muscles.

 

Today we are going to talk coffee!

And Reducing Expenses.

“Surprise, Surprise, Surprise”, to quote Gomer Pyle. Yes you heard me right we are going to talk coffee, java, Cup Of Joe, or whatever else you call that extremely gross stuff most humans drink every morning to wake up. It has gotten to the point where many of my friends and co-workers cannot even function until they have started on their 2nd or 3rd glass of coffee in the morning. They continue to pour the stuff down their gullet all day and into the evening, then they wonder why they can never get a good night sleep.

Many of my friends have a daily ritual of hitting one of the ever popular premium coffee joints such as Starbucks, or Mr. Bean and spending $5+ dollars on a fancy coffee drink I cannot even pronounce the name of, let alone figure out what they just ordered. Then the sales person askes what size would

you like your drink, and again I have no clue what they just said.

And most people don’t stop with just the crazy named coffee drink, they have to get the little lemon pound cake for another $3+ dollars. So now your single trip to the coffee house is giving you a one way ticket to the poor house. And just imagine if a person was to make this trip two, three or even more times per day. At an average of $8 a trip times two trips per day and you are at $16 per day. Or if you look at the bigger picture that if you made two stops per day, your grand total would be $5,840 per year. I think you can see where I’m going with this blog at this point.

So now that you are most likely laughing at my lack of knowledge of the Starbucks culture, I will tell you that I don’t drink coffee. So I figured I didn’t needed to learn the language of ordering coffee. But what I did figure out one day in August of 2007, was the language of how much those fancy coffees drinks are costing the Jones of the world.

Starbucks

How much did you say that coffee cost?

So in August of 2007 I met a person who shall remain anonymous, so let’s call her Natasha. As I got to know Natasha I soon realized that she like many of my friends had an infinity for the Starbucks culture. As Natasha and I became closer we co-mingled money as many couples do, when they start to cohabitate together. Since I have been using Quicken to track my finances since the early 90s, it was only natural to add her financial data in my quicken file.

As Natasha and I became closer and began sharing our lives together, I was able to train myself to get past the smell of burnt coffee. We would share time together hanging at Starbucks. And every time the price would pop up on the cash register my heart would drop at the sight of the price tag. So one day I decided I would make a special category in my Quicken account called Starbucks.

coffee2

Yep you guessed it I started tracking Natasha’s habit in Quicken, unbeknownst to her. So over the course of a couple of months I tracked her spending habits that related to coffee. Some days she would only go once, some days more than once. Some days she would get food with her order and some days she would not.

Here is what it looks like when you wake up and smell the java.

   $9.65  Average per visit cost

        29  Average visits per month

$279.85 Total cost per month

 $3,358.20 Per Year

Holy Coffee Bean, Bat Man!!

When I first ran the report in quicken I thought I had done something wrong and ran the report two more times. The only way I believed the report was to have it list out all the entries day by day and I added them up on a calculator to make sure the number were correct.

coffee3 coffee4 coffee5 coffee6 coffee7

So at this point I could have done one of two things. One I could have gotten mad and just put my foot down and yelled and screamed till I was blue in the face. But being in a new relationship I opted for option number two which was a little more civil. Option two was a three pronged approach to reduce expenses by reducing her coffee expenditures.

First I went out and bought her a Kuerig and a huge supply of the K cups. The cost of both was about the amount of one month of Starbucks, so I figured it would be paid for itself in about one month.

Second I went out and purchased a really cool annual thermos mug from a local bagel shop that she also liked to get coffee and bagels at. Once a year they would sell these cups around Christmas for $129, and you could refill them as many time as you wanted for a one year.

Third I presented both of these items to her as a gift, and she was very excited about all of the above. So it was a win – win situation for the cost of 1.5 month of Starbucks we reduce our total cost of her daily habit, and put money back in our budget.

Ultimately I did explain to her the real reason for the gifts and how it will help us reduce expenses. And she still gets her daily fix of coffee and being social by getting her mug filled at the bagel place.

From then on she would mix it up some days she would take her coffee from home and some days she would stop at the bagel place.

 

Another Great Idea to Save On Coffee, and Reduce Expenses

Recently another very close friend of mine who also needs the IV coffee drip in the morning to get started, shared with me her method of still getting to enjoy her time at Starbucks with her friends, but does not kill her monthly budget.

This person has a Starbucks gift card that is rechargeable, and she put $25 per month on this card. When the card runs out of money she cannot go to Starbucks again till the next month. This allows her to still enjoy the time spent with her friends and enjoying those fancy coffee drinks.

 

So as you can see she has budgeted $25 in to her monthly budget, so she does not have to cut her enjoyment off completely, but at the same time she has put in place the tools to make sure she does not go over budget. The rest of the month she makes her coffee at home in the morning, as well as drinks the coffee provided by her employer..

coffee

 

How Can You Take Action Today, And Reduce Expenses

Here are a few things you can do now to reduce expenses and get started in your quest for a new debt free way of life.

  1. Imagine yourself debt free and making wise financial choices.
  2. Stop buying fancy coffee NOW
  3. Make your coffee at home
  4. Drink your employer provided coffee
  5. Sets some realistic financial and life goals
  6. Reduce Expenses in all categories from cable TV to coffee
  7. Start working our time tested methods in our course Breadcrumbs to financial freedom.

Let me and my team help you to help yourself reduce expenses, and become financial free.  Taking our on-line, video-on-demand, step-by-step course Bread Crumbs to Financial Freedom. Don’t be scared to ask and seek out help, and imagine the possibilities of getting out of debt, building wealth and changing the way you live, work and play.

I look forward to working with each and everyone one of you in the near future, and remember, each new day is another chance to change your life – you just have to find the right path.

 

Cheers

Paul

paul@whyliveindebt.com

http://whyliveindebt.com

 

P.S. Please don’t forget to browse to http://whyliveindebt.com/first100 and sign up for our newsletter, and the first 100 people to sign up for the newsletter will get $15 off our exciting new on-line video-on-demand course, Bread Crumbs to Financial Freedom: 12 Easy Steps to get out of debt and build wealth.

2 Responses on WLID: The Daily Grind, Common Sense Ways To Reduce Expenses"

  1. My sister recently told me that she hadn’t been to Starbucks in months. Her bank website started automatically categorizing her purchases and she saw for the first time how much she was actually spending there over time. She described the amount as “obscene”, haha.

    I’m pretty good about drinking coffee from home, but I could make even cheaper at-home options.

    • Rebekah
      Again thank you so much for adding to the conversation here on whyliveindebt.com. Funny how fast and unnoticeable the amount you spend each month on things like coffee, eating out, and a big one smoking. As we all know smoking cost a ton of money and can cost you your life so it is very expensive. Another funny one I had to help a friend of mine see that he was spending way to much money on was, dating. Yes he was single and recovering from many bad financial choices during his marriage, and was spending like $500+ a month going out and dating. I have to say dating is much cheaper for the woman than the man, I even hear women talk about how they go on dates just for the free meals and drinks (kind of sad if you ask me).

      Thanks for the comments and please keep posting
      Regards
      Paul

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