Ditching the daily coffee can pave the way to save

Bad news for coffee suppliers.

Have never understood why all these people carry cups of coffee around town like the holy grail. A friend of my wife who had a coffee most days found she was spending as much on coffee as on petrol for her small car!!

At the other end of the scale my wife and I are pensioners and are happy to go for a walk each day and have a coffee and read the FT, all paid for from our investments over the years.

Those who buy 20 cigarets a day have an option that would easily save over £1000 a year. Can anyone be bother to work out what this is invested and compounded over ten years?

Bob the electrician

As an investor in BATS and Starbucks, I am deeply offended by the tone of this article and subsequent discussion. Coffee and cigarettes are a staple of a civilised lifestyle. I am considering buying some Diageo, so we should not discourage the odd glass of malt as a way of coping with the stress of an uncertain financial climate. Saving should be fun!

20 coffees a month x 12 months x 40 year working life at £2.50 = £24000. Assuming that that money was instead invested in the stock market at approx 6% real return, this would give a final figure of approx £85k (in today's money). This would fund retirement five years early for someone intending to retire on £20k (in today's money) or alternatively would provide an additional income of approx £350 per month for someone who maintained the same retirment date. (assuming annuity conversion rates of 1/20). I personally use a mini cafetiere at work; which saves me approx £1.50 per cup; takes no longer out of my day when you consider queuing for a coffee as against preparing it yourself; and will allow me to retire approx 3 years sooner than my coffee shop colleagues. Moreover, this is one of perhaps 10 or 20 relatively minor lifestyle choices I have made which mean I will be able to comfortably retire at 50 while most colleagues with the same income and comparable lifestyle will be working into their 60s. That said, their are benefits to working later into life - but it will be good to have the choice. I really enjoy a morning coffee and can see that it may be worth working another five years in order to have a nice coffee shop coffee, however, I think few understand the true long term cost.

Who was it that said ?

No pleasure in life is worth forgoing for the sake of an extra two weeks in a nursing home in Weston Super Mare

You dont need to buy the coffee at a shop. If you invest in a professional expresso machine at your house and buy tins of Illy coffee when on offer at the supermarket you can make a fantastic strong cappuchino for about 40p.

I would'nt normally advertise but Illy are the best and much nicer than anything you will get when outside. Maximum of two a day though, its bad for your heart otherwise