You Deserve a $3 Coffee

What I’m Drinking as I Write:

If I’m at Dunkin’

  • Large iced coffee
  • Peanut butter cup swirl
  • Add a shot of espresso
  • With 1 cream on the side

If I’m at Starbucks

  • Triple shot of iced espresso
  • In a venti cup
  • Add 2 pumps of white chocolate mocha syrup
  • With sweet cream vanilla cold foam filled to the top

For years I have heard the same thing – stop spending money on coffee outside of the home. And now I would like to demonstrate my side of this argument. 

I’m going to use Dunkin’ Donuts as the coffee of choice, mainly because it is my favorite if I am looking for a simple hot cup of coffee. The national average price for a large cup of hot coffee at Dunkin’ is estimated at $2.32. Let’s say there is a Dunkin’ perfectly located on your way to work and you decide to stop for a large cup of java every day, Monday – Friday. That’s $12 a week, $52 a month, $624 a year, and $26,208 over the next 42 years (assuming you are 25 with a full retirement age of 67). 

Now let’s say you only enjoy coffee at home, and you make coffee each morning before work. Every week you go through half a bag of $8 ground coffee and $2 creamer. That’s $5 a week, $22 a month, $264 a year, and $11,088 over the next 42 years. Congratulations, you have saved $15,618 over 42 years by making coffee at home. Now let’s pretend you had invested this $7 difference in a S&P 500 fund weekly. We will keep it simple and assume an annual return of 8%. Using a time value of money calculation, you would have approximately $126,130 (total deposits of $15,330 with $110,800 of interest). You would have earned more than $100,000 over your working years by making coffee at home.

But…. would you actually? 

I’d like to introduce one of my favorite parts in personal finance – human behavior. Just because we know we would be better off making coffee at home and saving the difference weekly, does it mean we are going to? Instead, we might order takeout tonight and pay that $7 in fees and delivery. Or, we might get an extra appetizer at dinner. Maybe we upgrade our lunch combo to a large one and add a smoothie? Also possible. Let me get to the point. As humans, we feel the need to justify the majority of our actions. With this extra $7 we are saving by making our coffee at home, we are more likely to justify a future unnecessary purchase. Whether you order two drinks with dinner instead of one because you “didn’t stop at Dunkin on the way to work today,” or deserve ice cream tonight because you “made coffee at home” – you are just deferring a current discretionary purchase for another.

You are not simply better off because you did not stop for a $3 coffee; you are only better off if you put those dollars to use in a way that isn’t spending them. In my opinion, I think people get too much judgment for ordering specialty coffees. Of course I may be biased because I would be in a ghastly shape if every Starbucks or Dunkin’ within a 20-mile radius around me closed. But I don’t think it’s as simple as comparing making coffee at home or purchasing it at a coffee shop and trying to point out how much more you could save if you made it at home. Who is actually investing the difference? This would be like saying you only got the $5 meal at McDonald’s rather than the $7 meal as you pull out your phone to place a trade for $2 worth of an S&P 500 fund. It’s not reasonable. Are you logging every “saved” food expense in an excel sheet to tally up a total at the end of each week, month, or year to throw the difference into your investment account as well? If you are, then more power to you because you are not like most people! Most of us are just rationalizing additional (and likely unnecessary) purchases with those differences. 

Lastly, I would like to mention that everyone has a “thing”. People who enjoy working out and going to the gym pay for gym memberships and protein powders and energy drinks. People who enjoy animals have a dog or a cat and purchase toys and treats and fuzzy sweaters for them. Some people (like my father) enjoy a few sodas every night with [several] bowls of potato chips. Other people enjoy having a glass of wine or beer several nights a week with dinner or friends. Maybe someone enjoys a nice chocolate bar every night before bed? Whatever it is, everyone looks forward to something. Why not look forward to a delicious cup of coffee from your favorite cafe on your way to work in the morning? After all, what’s the point of working 45 years of our lives if we can’t enjoy our thing? I hope you enjoy a $3 coffee today, and maybe throw $3 in your investment account tomorrow instead.


When I was 19, I was told spending money purchasing coffee was a waste of money, so I borrowed a small coffee pot from my mother and went weeks (maybe two months?) making my own coffee at home. I often found myself studying at school in between classes, wishing I was sipping on a coffee instead of the cup of water I asked for. 

In my opinion, there is no better sensation than enjoying a cup of coffee while reading a book, studying for an exam, or researching a stock. Coffee no longer gives me a jolt of energy from the caffeine effects (several cups of coffee a day for years will do this to a person), but it affects me in so many other ways. I am mentally in a better mindset after I enjoy an iced coffee on a depressing, rainy Monday morning after an exhausting weekend. However you accomplish it, a better mindset in the morning sets the precedent for your entire day. We are more likely to accomplish complex things and be more productive or enthusiastic with our work or lifestyle when our morning starts in the best way possible. I don’t think $3 is a lot to sacrifice for this feeling. 

Months went by while I was making my own coffee and something felt like it was missing. I felt like I wasn’t working hard enough to deserve it or I wasn’t making enough discretionary income to justify my coffee purchase to someone else. I was working hard enough – I was working 40 hours a week while attending college classes and nearly 70 hours a week that summer. I did have the discretionary income to buy a few coffees each week. You shouldn’t have to justify your “thing” to anyone. Let yourself have it in moderation and stop feeling the need to justify every small decision.

Happy Sipping,



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