Origins of Latte Nonsense



Buy Yourself a F*^king Latte” was one of the more popular pieces I wrote in 2019. It was a debunking of a ridiculous claim by Suze Orman that buying coffee was like “peeing $1 million down the drain.”

Uh, no.

Another silly spending scold, guilting people into not buying things they can easily afford is one thing. That is bad enough, but consider the hypocrisy of these folks who themselves buy the sorts of overpriced baubles they counsel against.

Helaine Olen (MiB; see endnote here) has been calling out these folks for longer than any else I recall. But I never knew where these absurd finger-wagging anti-Latte scolds came from.

Until now.

Here is Mark Dent of The Hustle:

“The idea that fewer lattes could solve millennials’ financial woes has been around for more than 20 years and can be traced to one man: a financial adviser and author named David Bach.

“Are you latte-ing away your future?” Bach asked in a 1999 book. “Everyone makes enough money to become rich. What keeps us living paycheck to paycheck is that we spend more than we make on stuff we don’t need.”

Bach’s formula featured some questionable math. (The annualized returns on the Dow Jones, for instance, were ~9.7% between 1949 and 1999 — not 11% — and even assuming the latter rate, Bach’s own “Latte Factor Calculator” shows that saving $5/day for 40 years wouldn’t produce anything close to $2m.)”

Now we know who to blame for this ongoing BS…

Aside from the bad math and overall silliness of the Latte nonsense, the real issue is it ignores the much bigger concern about median wages. Despite recent gains, median wages have not kept up with bigger ticket items like homes over the past half-century:

Focusing on minutia while ignoring much bigger concerns may be a great plotline for an episode of Seinfeld, but it is a terrible way to engage in financial planning…



Buy Yourself a F*^king Latte (April 5, 2019)

Kawhi Leonard, Please Buy a New Car (January 17, 2020)

‘Never Buy a Boat’ and Other Misguided Financial Advice (October 3, 2015)

Advise accordingly ( January 15, 2020)



‘Just stop buying lattes’: The origins of a millennial housing myth
by Mark Dent
The Hustle, June 18, 2022


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