The Latte Factor

I have this book called Smart Couples Finish Rich. It is one of about 10 books that's presently on or beside my nightstand. I have read parts of it but never read the whole thing start to finish. Last night I wanted to unwind by reading something short and/or light so, instead of picking up a Southern Living magazine, I picked up this book. As you can guess from the title, it's a book about personal finance geared toward couples.

I went straight to this chapter that the author, David Bach (You might have seen him on Oprah. He's one of her go-tos for money episodes.), calls "The Latte Factor." To put it concisely (and paraphrase quite a bit), Bach thinks anyone can build wealth because it's not what you make but, rather, what you spend. In response to couples who had told him that they didn't have any extra money to save, he will have them track their expenses for a day. In particular, he had one lady tell him that she would stop at Starbucks on the way to work and get a latte and a muffin, go out to lunch, pick up an afternoon snack, and stop at the video store on the way home to get movies for her kids, etc. All of these little expenses add up and become your "latte factor." According to Bach, having a handle on your latte factor will enable you to save more.

Anyway, I've decided to track my expenses for a week to determine my latte factor. Stay tuned.

Personal finances and wealth were on my mind for a couple of reasons yesterday. First, I talked to my good friend Chris and, during the course of our conversation, he talked about this book he had read called something like "The 4-Hour Work Week." It's pretty famous. Anyway, the title gives you the whole premise. Chris is buying into it. I, on the other hand, after only googling this book and the author and not reading one word of the book, think it might be crap. Sorry Chris-- I love you but I don't think I'm digging this guy. He sells energy pills or something for a living. Obviously, I need to look into the issue a little deeper but that's my preliminary take.

Second, I decided to check into the a college savings plan for Jack and Samantha. Against the advice of most financial pros, I'm liking the Virginia Prepaid College Tuition Plan. Financial pros will tell you to invest in a 529 plan but I like the idea of locking into today's tuition costs. I'm thinking of getting the 5-year university plan in Samantha's name. If she doesn't use it, it can be transferred to Jack. When I brought it up to Ned last night, he didn't want to talk about it. So I guess we'll table that for about five years.

Speaking of latte factor, sometimes in life you get what you pay for. I discovered this today when I went through the McDonald's drive-thru on the way to cherub choir. McDonald's has added this line of mochas, lattes, hot chocolates, etc. I had a massive headache and figured some caffeine might help so I wanted a hot chocolate before choir. Because I had Bear and didn't want to deal with the car seat and taking her inside, I decided to go through the McDonald's drive-thru and get a hot chocolate. Let me start by telling you something that might surprise you, McDonald's really isn't any less expensive than Starbucks--for a hot chocolate maybe a quarter. I didn't discover this until later when I actually went to Starbucks because the hot chocolate I got from McDonald's was GARBAGE. It was seriously nasty; like water with chocolate syrup squirted in it. I was so disgusted by it that I called McDonald's from the church parking lot to ask them if they knew how to make a hot chocolate and whether they bothered to use milk. The manager told me they had been having trouble with the machine. Why didn't they tell me that BEFORE I bought the hot chocolate? I took the hot chocolate back to McDonald's and got my money back (which meant I had to get out of the car but Bear was back at the church). I then stopped at Starbucks before picking up Samantha. The moral of this story--don't buy specialty coffee drinks at McDonald's but, rather, get off your sorry butt and walk into Starbucks if you really want a hot chocolate or mocha. Lesson learned.

The reason we were in a rush before cherub choir was that I had decided to take Bear to Blockbuster before church so we could rent "Camp Rock." I tried to explain to her that renting movies was like checking books out of the library except that you have to pay. I also told her that if she liked the movie that we would think about buying it. I'm trying to get her to realize that money doesn't grow on trees and that she can't have everything she wants. She was pretty excited to watch it tonight. Problem is that I found out she had been in timeout today (for not listening to her teacher) AFTER we had already rented the movie. Therefore, "Camp Rock" is sitting in her armoire and she is not allowed to watch it until further notice. I'm hoping this will teach her a lesson.

Parenting is the hardest job I've ever had. And I washed dishes at a church camp one summer.

Love,
Allie