A few years ago I crossed paths with a personal finance concept called the Latte Factor and recently, I’ve drawn some parallels between it and my experience with constant distractions.
The general idea behind the Latte Factor is that frequent small purchases over 20 or more years end up being a very large amount of money. Apply some standard potential investment returns on that money, and that amount gets even larger. You can play with some numbers at the link above to learn more about that.
It’s quite alarming to see how much money those small purchases could have added up to had we spent it on investments instead of coffee or whatever else. While I do see buying coffee as a life enhancement for several reasons, I can see the author’s point. We often trade these frequent four and five dollar purchases for what could be major progress towards financial independence.
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