Suze Orman: How Your Daily Coffee Habit Is Costing You $1 Million
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- Опубліковано 27 бер 2019
- Financial expert Suze Orman says she refuses to pay for a cup of coffee because it's a waste of money that could be invested or used to pay off debt.
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Is your daily Starbucks habit worth the money?
Suze Orman, financial expert and best-selling author of "Women and Money," doesn't think so. "I wouldn't buy a cup of coffee anywhere, ever - and I can afford it - because I would not insult myself by wasting money that way," she tells CNBC Make It.
That's because takeout coffee is a "want," not a "need," Orman says. Instead, that cash could be invested and put to work, she argues.
Let's say you spend around $100 on coffee each month. If you were to put that $100 into a Roth IRA instead, after 40 years the money would have grown to around $1 million with a 12 percent rate of return. Even with a seven percent rate of return, you'd still have around $250,000.
"You need to think about it as: You are peeing $1 million down the drain as you are drinking that coffee," Orman says. "Do you really want to do that? No."
When it comes to saving for the future, "Every single penny counts."
It all comes down to your financial priorities. Why spend money on coffee when you can make it at home for much cheaper? Orman argues. "If you just simply used your money to purchase needs versus wants, you would find the money to invest in your retirement accounts," she says. "You would find the money to get yourself out of credit card debt."
Orman isn't alone in avoiding small, daily purchases like a morning latte. Kevin O'Leary, star of ABC's "Shark Tank," also refuses to fork over money for takeout coffee.
"Do I pay $2.50 for a coffee? Never, never, never do I do that," he tells CNBC Make It. "That is such a waste of money for something that costs 20 cents. I never buy a frape-latte-blah-blah-blah-woof-woof-woof for $2.50."
Instead, O'Leary makes his java at home and invests the money he saves. Like Orman, O'Leary chooses to prioritize other financial goals over a $3 cup of coffee.
"The truth is, there is a lot of crap you don't need," he says. "What I've learned to do, and what has really helped me in maintaining growth in my own personal investing is, anytime I pick up something I'm going to buy, I say to myself, 'Do I really need this?'"
That's because if he doesn't buy it, "the money is going to be invested and make money every year for me while I'm sleeping."
Some experts take a different stance. Ramit Sethi, bestselling author of "I Will Teach You To Be Rich," has no problem with splurging on the occasional latte - as long as you're taking care of other priorities, including paying your bills and saving for the future.
"Everywhere you turn, you hear people telling you what you can't do with your money: No lattes, no jeans, no vacations," Sethi tells CNBC Make It. But even though the costs of small pleasures can add up over a lifetime, giving up all the "extras" typically doesn't work in the long run, he says.
It can be difficult to constantly say no. Plus, there's not only a limit to how much you can cut your spending, but to how far trimming your spending can get you, as well.
Ultimately, Sethi says, the ends don't justify the means, at least not when the means make you miserable. "One day, when you're 2,000 years old, you can feel great - who wants to live like that?" he says. "Life isn't simply about cutting back."
Instead, he recommends making your savings automatic. That way, you'll know that your long-term financial goals are taken care of and you can use any leftover money guilt-free.
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Suze Orman: If you waste money on coffee, it’s like ‘peeing $1 million down the drain’ | CNBC Make It.
Nothing successful people hate more than coffee buyers
In a culture leaning more and more into loneliness, I'd say that a few bucks for a coffee with the opportunity to connect with another human being is pretty worth it. Singling out coffee as a sure-fire way to bolster that IRA leaves little room for a person to be creative with their money.
I make my coffee my self for two reasons one to save money and two because i like to be in control of what goes into it
I pour coffee over my iPhone and avocado toast before drinking it....
This woman is a gash. People are broke because the world is a giant corporate dumpster fire. Not from coffee.
This is scarcity mindset, I bet she spends a good amount daily on stuff she feels is important.
@Matt Frazier
util (plural utils) (economics) A hypothetical unit measuring satisfaction. (informal, computing) A utility.
Herpes lasts even longer than cosmetics, that doesn't make it more valuable.
@Matt Frazier
So cosmetics are better because she can keep them, but they're also better because she can get rid of them...
Which is it? Is it a useful thing to own that's worth its cost, or is it a useless thing to own that that is worth less than its cost.
It can't be both.
Me: she's an ignorant out of touch hypocrite proven by this video alone.
You: ya, but her fashion apparel lasts longer than coffee.
Me: That's irrelevant, that's not what she was talking about, that's not how worth is measured, and that doesn't require an ultimatum between the two. Long-lasting isn't a value, that says nothing about what's being consumed.
You: But if she wasted enough money on designer clothes, maybe she can make her money back.
.....
How is that more useful than coffee?
*_util (plural utils) (economics) A hypothetical unit measuring satisfaction. (informal, computing) A utility._*
What part of that definition talks about market/resell value? You can't resell food. Following that logic, people should just die of starvation since food expires.
Do you know what caffeine is? Or are you joking?
Second hand clothes, designer or not, do not retain their value.
People don't pay the same price for second hand clothes, especially when it's out of fashion.
Now, tell me, how is she going to resell her makeup and hairdo?
She can afford it!!
@@pinenkuo And people can afford coffee. So she shouldn't have opened her mouth, should she.
@@CoryMck She has more disposable income though. 78% of Americans can't afford a $1000 emergency, and she isn't one of them but that doesn't make the advice invalid.
Completely ignoring the fact that making coffee at home is also still an expense, so that entire $100/month she's bleating about isn't going into the IRA. But, yeah, she's supposedly a financial expert.
Hey, Suze, you know what you're paying extra for when you buy coffee out? CONVENIENCE. It comes in handy for those of us who have to work two jobs to pay off student debt, and only have a 20 minute window to get into the bathroom at home, because we have four housemates because housing is so friggin' expensive. So let's just stop pretending it's still the 1970s, shall we?
cost of making coffee at home is 10% of what u would spend at starbucks, let that sink in
I feel that the answer to this coffee problem is to invest in a great coffee maker and coffee and do it yourself
I contribute the max to my Roth, and quite a bit to my 401(k), all the while drinking coffee. If $100 a month makes a difference in your life, then you are poor and have a lot more to evaluate than your coffee spending habits.
Mmhmm, yes, like why you're being paid so little for the job you statistically have. Or why so many people in society are in this position despite working multiple hours everyday.
the math doesn't work out
""""financial advisor""""
Assuming a 12% average yearly interest rate, it does (slightly optimistic, but it's still doable).
@@jayshko 12% was due to high fed rates back in the day. The next 40 years can be a different beast. Also, 48000 forty years ago after some discounted cash flow turned into 1 mil doesn't mean that much. It would be about 300k accounting for inflation alone. 40 years of daily coffee is worth more to me than 300k.
Instead, you waste your money on bad hair dye and spray tans.
Boomer mindset "I know you buy coffee everyday to bring a little joy into your life as you go work 2 jobs to help pay for your one bedroom apt that costs 3k a months and try to pay off your massive student loan debt you got perusing a degree in business management that my generation pressured you into getting, maybe you wouldn't be struggling If you didnt but that coffee."
Make your own Damm coffe people!
Yo! CNBC, have a chat with your executive producer, audit your content. I like a lot of your videos but some of them are so random and awful. I'm not sure if your next video will be "How We Got Some Random Person Of The Street To Produce Some Content." No offense.
Sherad Louis-Charles so don’t watch problem solved
A random person off the street would have more entertainment value than Suze Orman.
@@saulgoodman2438 I like thier videos but sometimes it's out there. The one with the $1 hot dog vs $6 hot dog was just bizarre. A little feedback can go a long way even if it's not entirely positive.
Sherad Louis-Charles do u have big coke?
@@saulgoodman2438 i hav big bepis
I'm all for saving and stuff but, with 100$ a mounth compounded over 40 years (no lump sum up front) you would need about 11.5% return p/a AFTER inflation so you would need more like 14-15%. That's not realistic! However with about 7% (after inflation) you would have ~260k. Get your numbers right!
Watch videos of this women in 2006-2008. She is clueless on the debt cycle inflation etc. A mouthpiece for holding your income hostage
She is a con artist for sure
$1-$3 LOL. It’s almost $7 for my daily order at Starbucks. That’s only $91,580 after 40 years, money well spent in my book.
@Moonis Real estate is the only thing I’ll ever invest in.
$1 per work day per month = $100/mo. in Suze's world... who is she yelling at? Where's she getting that kind of ROI too? Should I stop wearing pants to work due to their cost? "I'm focusing on retirement, so it's shorts from now on boss."
$1-$3 per day. $3/day x 30 = $90. Not many places you can get a cup of coffee for $1.
Coffee is an overpriced habit 🔥
So is bathing
Beats cigs and vaping
Me drinking coffee keeps others alive. 😃
1million dollars in 30 years is nothing if you are a CEO of a successful company.
ah yes, every average american becomes a ceo of a company right?
I bet she’s a freakin blast at parties. 🤦♂️
she makes a good point but its kinda like where does it end? almost everything we have is a want and not a need.
Best million I ever spent.
I personally make my coffee at home (convenience & price), but really, how much does she spend on her highlights each months? They ain’t cheap! Let’s say you spend $5 on coffee daily. $5x30 days in a month = $150. Highlights easily run $200+, and that’s on the cheap side. Her roots aren’t showing that much in this video, meaning she gets highlights done often (and at least monthly). Plus, they appear to be high-quality highlights, which cost around $400/visit. Suze, do really NEED highlights? Highlights that are more expensive than a daily coffee? 🤔
Jessuz this woman is angry lol
Keenan Smith You wouldn’t say the same thing if she was a man. This is the classic Dave Ramsey style and people love him for it.
@@lsmith9316 how do you know that? Do you know me? No..
@@lsmith9316 she is categorically angry in this video. She is a horrible person. She literally blaming poverty on coffee like as if it's a new commodity. She's out of touch. Do you know what I call out of touch millionaires complaining about coffee drinkers (who actually work)? Food
Keenan Smith you’re not denying it...
Cory Mck Most financial gurus rant against spending money on coffee as a daily habit. She’s not touting anything new or outrageous here. As for her delivery, sure it’s aggressive, but that’s what gets her heard. And like I said, Dave Ramsey uses the same exact style in his videos and no one’s calling him an angry man.
I'd rather spend the money on a small espresso machine and good beans. But buying coffee outside their are other factors like rewards points, it's not everyday you pay, there are times you get freebies. But yea overall just stick to home brew and learn to make it better then last time
Or you can make your own coffee for 10c only.
Shut up about the coffee already!!!!!
I used to buy coffee almost every day & now buy it once or twice a week. I'm definitely saving money & use it to invest instead. Those of you criticizing Suze because of what she may have spent on hair, etc. ... she can afford it. Keep wasting your money as you're only cheating your future self, not Suze.
5 seconds in I already see this is trite. Coffee once a week? Really?
Okay Boomer
Suze Orman: sucking the joy out of life for decades
Buy instant coffee for 4 bucks for 30pcs charge it to pantry done, free coffee. I only drink starbucks at the airport just to look smart and Stop using the term "burn rate" it's "cash spendings" for your just to sound smart.
I concur. My old roomie could afford $4 at Skunkbucks every day, but she could not afford $4/month for her birth control prescription at Walmart.
$1-3 on a cup of coffee? I wish my coffee cost that little! And damn Suzy, no need to yell at me like that! Lol
People take these soo literally, and she makes sense much like Dave Ramsey. Poor financial decisions come down to each individual. You can still live your life and get coffee, but why everyday? If that's your enjoyment in getting it everyday, but your in piles of debt please don't complain. Your money can be allocated to both. Just think wisely before spending. A need vs a want is such a good cliche to follow for the most part.
So you think people would succeed if they didn't spend money on small creature comforts?
*coffeeislove*
All the dislikers are poor
If someone is saving on coffee that means he/she is not living life he/she is just dragging life!!
Manav Mishra Going broke is even worse of the living life. No just Suze Orman but check out the debt-free teachingsOf Mr. Dave Ramsey on UA-cam. That is a much better way to live life then making the corporate owners of coffee houses be able to live at the beach and you can’t.
@@Beachbumbob whats the point of having money if u don't spend and enjoy it?? ur gonna save save save your whole life, and then be an 85 year old in a wheelchair with a million dollars u can't even enjoy lol
@@Beachbumbob spending a couple bucks a day on coffee isn't gonna hurt ur pockets.. if it is, you need to find ways to make more income lol
@@tonysopranooo1 I bet the 4 to 10 thousand Disney workers that just got their pink "lay offed their jobs" Pink Slips wish they had thought differently when it comes to their spending habits, now that no paychecks are coming and the first of the month here in a couple of days ! I know I sure did when I went 6 yrs without a fulltime job back at the HIGHT of the Depression-Recession the USA had . Now that I am completely debt free we can enjoy a starbucks cup once in a while. ua-cam.com/video/ts5DeaGOz3I/v-deo.html
@@tonysopranooo1 See what happens when this couple , using Mr Ramsey's Debt Free Student Loan Paid Off teachings , in 3 yrs! ua-cam.com/video/UuUZDhrYb9w/v-deo.html
Kevin O leary already beat you to this topic lady
i'd love to see her battle Ramit Sethi's views on this. I'm more on Ramit's side.Ramit's views: ua-cam.com/video/8hgSoPYl8zs/v-deo.html
I can afford it lady
A good habit to be rich!!
But it is a hard truth for those coffee lovers or addicts.
$100/month x 40 years (age 20~60) = 1 million in Roth IRA
Love Suze`s tough love. We all need it from time to time.
Waste money on coffee is an insult eh? What about the thousands of dollars spent just on the hair, makeup, jewelry, clothes, ans spray tan used to make this video?
She cray cray!
Just brew your own damn coffee 😂 it tastes better anyway
Buy me a coffee maker.
These millennials buying cups of coffee instead of paying their student loans
This but more obviously ironic.
If you can't even afford a cup of coffee you have no hope of being able to afford a student loan payment.
She could stop buying makeup
i was on my way for my cup of coffe. not anymore haha
Suze orman queen
Scam lady!
80% of the commentsection doesnt get the point and is blaming a women with 100$ mio net worth of having no clue
So glad I don't drink coffee 😃