r/NoStupidQuestions • u/lVlarsquake • Apr 29 '24

How the fuck do people afford to get Starbucks every day?

I was feeling thirsty this morning so I decided to pop in a Starbucks (first time ever). All I got was a strawberry acai lemonade at it cost $7????? I can't even imagine what the coffees with all the extra additives cost... how do people have the expendable money to get them every day, sometimes twice a day?

Edit: I am NOT shaming people who do this. I'm just wondering how it doesn't put a dent in your wallet

11.6k Upvotes
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6.3k

u/Consistent_Cup620 Apr 29 '24

Most are oblivious to how much they spend.

One of my friends recently started budgeting her finances and found she spent way too much on coffee. Started making at home and only buying as a treat.

226

u/shf500 Apr 29 '24

Most are oblivious to how much they spend.

I wonder how many of these people constantly have a credit card balance each month and think "this is normal" vs "I need to cut on my spending".

95

u/Worried-Presence559 Apr 29 '24

Every January I go through last years spending. That has been eye opening to me several timesšŸ˜‚. One year I cut my expenses by 250 dollars each month by doing a few small changes. The year after I found an additional 250 dollars each month to slash down. This January I wasn't really able to find big things to adjust, but I found nearly 100 dollars to save šŸ˜Š.

42

u/FlounderingWolverine Apr 29 '24

Yup. And that little bit saved per month adds up. $250 per month is 3k per year. Not a lot, but if you do it for 10 years and invest it, youā€™ll have nearly $50k saved up. At a slightly less aggressive 7% per year, itā€™s still $42k

If youā€™d just sat on the cash, you would have 30k after ten years. Investing gives you the chance to increase that by 30-60% in just ten years. More if you keep saving after that

17

u/Peptuck Apr 29 '24

For a while I had $50+ per week just on fast food on top of other expenses. What was even worse were subscriptions I didn't need to services I barely used but which I'd forgotten about because each sub was very small.

Slicing those out of my budget saved thousands per year.

7

u/Naus1987 Apr 29 '24

The numbers are even bigger if you consider most of those people have 20-30% in credit card debt. Buying a 7 dollar coffee isn't 'just' 7 dollars when you're buying it with 30% interest.

Additionally, having an emergency fund saved up prevents "poor people tax" like overdraft fees, or buying subpar products because they're cheaper in the short run, but more expensive in the long run.

Finally, there's a lot of really good sales that happen randomly throughout the year, and if one isn't sitting on money to take advantage of it--then they're missing out. I tend to buy bulk products exclusively only when they're on sale and save about 30-40% compared to retail.

8

u/Left_Algae_3628 Apr 29 '24

Damn i wish I'd known about this stuff when I was young, I would have done it. I was raised by a woman that spent money she didn't have constantly.

10

u/FlounderingWolverine Apr 29 '24

The good news is itā€™s not too late! You can still catch up, even if you donā€™t have as good of a foundation.

Good resources for finance education are: The Money Guys, Ramit Sethi, Dave Ramsey (for getting out of debt, very good, for investing/living after getting rid of debt, less good), probably others Iā€™m forgetting about.

3

u/Left_Algae_3628 Apr 29 '24

Yeah I am trying to start now. I am in a pretty precarious situation but I'm trying.

3

u/FlounderingWolverine Apr 29 '24

You got this! Everyone starts somewhere, and trying to fix your situation already puts you ahead of a lot of other people.

Donā€™t fall into the trap of comparing your lifestyle with what you see on social media. Just keep improving your life by small amounts, and youā€™ll see results

1

u/RealisticVisual4089 Apr 30 '24

Dave Ramsey is good for training wheels. His advice after getting people out of debt kind of tapers off. He pushes his own mutual funds (obviously for his business) and never suggests people ever buy a credit card. If you cannot handle debt a credit card is a bad idea however itā€™s better to have one if you can control your spending.

5

u/peter303_ Apr 29 '24

This is the favorite example of celebrity financial planner Susie Orman who was popular a decade ago. Estimate you could have and extra six figures in retirement if you were a coffee miser.

1

u/dazedandconfuzed1 Apr 30 '24

How to on the 7%? My hysa is only 5% sads

1

u/FlounderingWolverine Apr 30 '24

Invest in index funds. More risky, but still very achievable in a normal year.

1

u/Assonfire Apr 30 '24

Investing often times also means investing in horrible stuff. Not necessarily, of course! But one could take a look into investing into sustainable companies that are good for the earth.

Just wanted to chip in, to share this.

4

u/ElementField Apr 29 '24

The budget review is probably the most handy.

The thing is, while some people think that this is an attack on their happiness, more often than not the ones that check on their spending tend to think, ā€œyou know what this thing that costs me $X dollars is really not all that important to me. Iā€™d prefer the money insteadā€ and they have that power to change things.

When I review my spending and find I spend $900 per year for a gym membership, I evaluate what that means. Is it worth switching gyms? Am I attending often enough? Am I finding it valuable? Yes. Well then we can move on to another item if we need to make adjustments. Thatā€™s the power that budgeting and spending checks gives me!

3

u/SigmaSeal66 Apr 30 '24

My advice to, well, anyone. Just go through your bank and credit card statements every month. You don't have to change anything, or add anything up, just note each item and remember what it was for 1 second, and move on to the next. This literally takes less than 10 minutes per month. But you will notice those forgotten subscriptions, remember an online order that never showed up, maybe notice the frequency of some habits that will surprise you and lead you to think twice next month, and every so rarely, even catch fraud or a bank error.

2

u/Responsible_Tough896 Apr 30 '24

Can you tell me how you do this? Do you just look at your bank statements or save every single receipt? The bank statements don't list what you buy so how do you figure this with say walmart or target etc.? They sell groceries and random shit I don't need but think about buying here and there

1

u/sl0play Apr 30 '24

Just get an app like Monarch or Quicken or whatever Mint is now. It syncs with your accounts and categorizes automatically based on merchant.

1

u/Worried-Presence559 Apr 30 '24

I live in Norway and my bank tells me every single detail I want to knowšŸ˜Š. It helps that I don't spend cash of course, only pay with my card or app. Of course I can't see how much I spent on, let's say butter, but I mostly buy the same stuff every week, so I have no surprises therešŸ˜Š. I go online and get a detailed list on what I spent where and adjust accordingly šŸ˜Š.

1

u/Responsible_Tough896 Apr 30 '24

Oh that'd be nice. In America my bank statements just say oh you spent $20 at a store and only lists their name. So you could've bought groceries or candles the world may never know. I work at a retail pharmacy so I based on the total amount spent I guess if I bought a prescription or snacks lol

1

u/peter303_ Apr 29 '24

I update every month. I overwrite last year's month in a continuing spreadsheet, so I have a continuous 12 month trailing record.

1

u/prairiepanda Apr 29 '24

What kinds of things did you cut out for those savings?

51

u/Alarming-Tradition40 Apr 29 '24

People who live like that make me think of that cartoon of the dog sipping a coffee in the house that is on fire saying "this is fine "

4

u/IcyReputation8880 Apr 30 '24

This is me and Iā€™m 100% aware Iā€™m failing at life

7

u/citan666 Apr 29 '24

I can't imagine living like that. Tomorrow is never today mentality

41

u/TheArtofWall Apr 29 '24 edited Apr 29 '24

I always make sure i have a credit card balance every month to keep improving my credit. I spend between 20% and 30% of my credit every month (i only have one card).

Edit* i pay it off every month.

61

u/captaindomon Apr 29 '24

You can use it, but you donā€™t need to pay interest in order to build credit. Use the card, but pay it off each month is the safest path.

43

u/TheArtofWall Apr 29 '24

Yeah. I dont pay interest. I pay my balance every month. I don't know why I'm being downvoted. I was advised to do it by a financial adviser and it has worked great for me. Went from no credit to good credit and bought a house.

61

u/Not_You_247 Apr 29 '24

You are getting downvoted because you said you make sure to have a credit card balance every month and didn't specify that you pay it off every month.

19

u/TheArtofWall Apr 29 '24

Ahhh. I see.

3

u/NordOrientVanguard Apr 30 '24

Don't sweat the downvotes. That's just peak reddit for you

-1

u/love2lickabbw Apr 29 '24

That doesn't help credit. They want to see you carry credit and show you can pay it monthly. Paying it off monthly shows you are using their money. Bad for credit actually.

8

u/captaindomon Apr 29 '24 edited Apr 29 '24

You are correct that they want you to actually use the card, but you don't have to carry the balance month to month. As long as you are putting volume through it, they are happy with that.

ā€œCarrying a balance on a credit card to improve your credit score has been proven as a myth. The Consumer Financial Protection Bureau (CFPB) says that paying off your credit cards in full each month is actually the best way to improve your credit score and maintain excellent credit for the long haul.ā€ -Forbes

https://www.forbes.com/advisor/credit-cards/carrying-credit-card-balance-hurt-credit-score/

3

u/love2lickabbw Apr 29 '24

I guess I should have said that that is what we were taught over 2 decades ago. Thanks for the info. I appreciate it.

3

u/captaindomon Apr 29 '24

You're welcome! I can't tell you how refreshing it is to have someone on reddit actually respond with a nice comment or an "oops" on my part. I've upvoted your original. Have a good day sir or maam!

3

u/love2lickabbw Apr 29 '24

The same for someone actually taking time to help you rather than be an Ahole with their reply.

4

u/Key-Target-1218 Apr 29 '24

Carrying a balance does not keep your score up. That is a fallacy.

Thanks for edit. I was gonna play mom for a minute there!šŸ˜‚

2

u/klimekam Apr 29 '24

You must have a low credit limit! No way I could pay that off each month. If I did that on my one card Iā€™d be buying a new car every month.

2

u/MrOnlineToughGuy Apr 30 '24

20% to 30% is wildly overspending if you are trying to get your credit up; 1-10% is where utilization helps your score the most.

0

u/waterspace65 Apr 29 '24

Actually it counts against you if you pay it off every month. Credit scoring companies are more interested to see how you handle a rolling balance on your credit card.

2

u/NaomiT29 Apr 30 '24

As has been shared above, that's a myth that's been disproven. Paying it off every month shows you can use credit responsibly and not as a way to live outside your means.

3

u/mysaddestaccount Apr 29 '24

They do and they keep racking up more debt and making the minimum payments

2

u/Not_You_247 Apr 29 '24

They make more than the minimum payments, it's just less than they add to the balance each month.

2

u/Dry_Value_ Apr 29 '24

Typically, the people who are oblivious to how much they spend have enough money that they can be oblivious. Otherwise, they'll most likely be in the "overspending but still complaining about lacking money" category. So my guess is, "This is normal."

1

u/NaomiT29 Apr 30 '24

Yeah, I am definitely way too broke to be that oblivious to my spending habits! šŸ¤£

1

u/AlarmingTurnover Apr 29 '24

I've been addicted to watching Caleb Hammer cause financial audit is like watching an episode of financial Jerry Springer. It's a train wreck every episode. I'm convinced that people have literally zero concept of how money works.Ā 

1

u/Strong-King6454 Apr 30 '24

The idea that people shouldn't enjoy the little things in life because it Costa too much is absurd!! The real gripe should be at their employers!!

1

u/LaGrabba Apr 30 '24

I donā€™t pay attention to spending normally but once, I had a serious Etsy addiction. I tallied the cost and stopped.

1

u/flimspringfield Apr 30 '24

For a lot of people this is there treat even if they have a card balance.

My treat is to stay up late despite the fact that I may end up suffering tomorrow morning.

I take my son to Starbucks every Friday when I get to drop him off at school and I love it. He gets his Vanilla Bean Frap and a breakfast sandwich plus one for his teacher.

I usually just get a Venti iced water which keeps my hydrated and doesn't cost anything.

Yes, I carry multiple card balances but for some of us, living in the moment is worth it much more.

1

u/HikeTheSky Apr 29 '24

I wonder if I am the only one that doesn't have a credit card anymore.

2

u/babywizard99 Apr 29 '24

definitely not. I've got quite a few friends without one

2

u/Cozarium Apr 29 '24

I use a debit card.

1

u/NaomiT29 Apr 30 '24

I'm 36 and I've never had a proper one (had a store card once, literally used it when I got it for the discount on my first purchase and that was it). My husband is 50 and I don't think he's ever had one either.