Personal Finance: The Latté Debate Isn’t About Coffee

Image from

If you are a personal finance enthusiast, you must have heard about the latté debate. Maybe even participated.

Every so often, talking heads in the various splinters of personal finance and wellness, that is, the FIRE movement, the minimalist battalion, the frugality ninjas et al, go at each other’s throats over something so endearing yet so apparently divisive. A cup of coffee.

On one hand, some express blustering disgust at the wastefulness of lining up at a Starbucks each morning to buy a cup of coffee. They argue, and rightly so, that if you spend just a couple of dollars buying a cup of coffee every morning, at a certain compounded interest rate, it racks up to millions of dollars over several decades. Money literally down the toilet. They argue that by making your coffee at home, or foregoing the stimulant altogether, those millions of dollars could buy you financial freedom, or other things more valuable than a cup of coffee.

On the other hand, you have the folks who view the suggestion that you can become a millionaire by scrimping on coffee as outrageous. They believe in the gospel of expanding your income. They think of this to be a more practical path to financial independence, as opposed to pinching pennies on coffee or any of the other little pleasures of life.

It is funny how nowadays, no idea regardless of how noble and no matter its potential to transform the world, goes without resulting into divisions that quickly degenerate into vicious cliques engaging “opponents” in brutal takedowns. We have seen that in personal finance, in vegetarianism/veganism, in climate advocacy, in meditative science… everywhere. The sibling rivalry is just astounding.

Our generation, it seems, has gotten so hell-bent on proving others wrong, it has become our way of life. People walk around with pointed claws ready to attack and disprove your line of thought. You could say the rainbow has seven colours and someone will go on a podcast to argue why you are wrong.

Sadly, the collateral damage in many of these pointless cockfights is the uninformed people who are trying to educate themselves, so they can improve their current states and lead more fulfilling lives. They end up lost and confused by the eloquently presented, yet sharply conflicting ideas on every little detail of whatever they are trying to learn or practice.

Frustrated by all the acrimony and the meanness, these weary souls either give up eventually or pick a side on a whim – meaning that instead of a solution, they now have a religion.

Frankly, a lot of these debates unnecessarily focus on semantics and mundanities and end up discounting the bigger picture.

I wish we could all agree that the latté debate needs not be about coffee. The power in the idea of relating financial freedom to tiny habits like how we get our daily dose of caffeine should not be wasted on trivialities.

To me, this debate should get us convinced of the power of compound interest, the power of delayed gratification and the power within us to alter the course of our financial destinations by making small, manageable changes to our daily lives. Instead, we have two factions of well-meaning people, shouting down each other all the time, and drowning out any voice of collective reason in the process.

The genius of using simple, relatable objects to demonstrate difficult concepts like compound interest and delayed gratification should be lauded not bashed. The legendary Stanford marshmallow experiment would probably have been far less successful in terms of its teachings and memorability, had Professor Walter Mischel used uncommon items most people cannot relate to. Instead, he demonstrated a difficult concept using kids and their unflinching love for marshmallows. The professor was lucky to have conducted his experiment in 1972, a time when the world was more amenable to aphorisms and less susceptible to taking things too literally.

So yes, go cut small expenses you can do without. Small leaks can sink a great ship. If you can raise your income concurrently, good for you. If not, it doesn’t make the argument any less valid.

Investing those small amounts and compounding them over long periods of time will make a difference akin to night and day eventually.  That could involve carrying lunch from home, buying items in bulk, going out less often, taking a matatu to work sometimes et cetera. It could also be literally giving up your cup of coffee, but it doesn’t have to be.

Give Your Personal Finance A Chance & Kill The “I Deserve This” Bug

Previous articleHealth: 7 Benefits Of Purple Tea You May Not Know About
Next articleLifestyle: 10 Different Alcoholic Cocktails You Should Try This Holiday
@TheSoww tweets about money and markets, with a particular interest in personal finance.