Millennials have been made fun of for being entitled and for oversharing on social media. Now, it appears that this generation also has a lot to learn about good financial habits as it was reported that millennials spend more on coffee than on savings.
According to a study conducted by SurveyMonkey for investing app Acorns (via Munchies), almost half of 1,900 millennials surveyed spend more for their morning cup of coffee than in any kind of savings or retirement fund. It was also found out that women are particularly guilty of this frivolous habit.
“A staggering 44 percent of female millennials aged 18-35 spent more on their morning fix than they did putting money aside this year,” Acorn told Munchies. “What’s more is that this number is almost 10 percent higher than the number of millennial males with the same habit in the same time frame.”
Though a cup of coffee may seem like an inexpensive indulgence compared to other luxuries, the cost of a morning cup of joe adds up to a significant amount over time.
Consider the cost of one of the most popular Starbucks drinks—the Caffe Mocha with Whipped Cream. A Grande (large) cup costs $4.15. A person with a daily Starbucks habit would be spending $29.05 a week, or $116.20 a month. This adds up to a whopping $1,394.40 a year. This amount can be spent building a diversified IRA portfolio, or if one is into buying stocks, it’s enough for three shares of CVS health.
To be able to fund one’s coffee habit while saving up for the future, Acorn suggests rounding up every purchase to the nearest dollar and putting those cents into an investment fund.
Better yet, get an espresso or coffee maker and some good coffee beans to make your own brew. You’ll save more money in the end.
For more, check out Jobs & Hire’s report on the common money wasters.
