) that $100 a month -- a little more than $3 on coffee a day -- would turn into $1 million after 40 years in a Roth IRA. That's assuming a healthy 12% return, but even at 7%, that'd give you an extra $250,000 for your golden years.
"I wouldn't buy a cup of coffee anywhere, ever -- and I can afford it," Orman said. "I would not insult myself by wasting money that way."
It's a matter of needs vs. wants, she said. If you focus on the former "you would find the money to invest in your retirement accounts... you would find the money to get yourself out of credit card debt." Here, let her explain it:
Obviously, Orman isn't the first adviser to call out the financial downside of a Starbucks (SBUX) habit.
In David Bach's book "The Automatic Millionaire," he mentions "The Latte Factor (https://davidbach.com/latte-factor/ )." His website has a calculator showing what such a ritual costs over time.
"Putting aside as little as a few dollars a day for your future rather than spending it on little purchases such as lattes, bottled water, fast food, cigarettes, magazines and so on, can really make a difference between accumulating wealth and living paycheck to paycheck," Bach writes.
And it is, indeed, a problem, according to a 2017 survey from investing app Acorns (https://www.usatoday.com/story/ money/nation-now/2017/01/11/spending-more-coffee-than-investing-youre-not-alone/96385882/), which found that almost half (45%) of younger millennials put more money toward coffee than retirement savings.
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