A lot of people wonder why they spend so much money on coffee, when they could save it for other things. I think there are a few reasons for this.

One reason is that it’s a habit. Some people just need their caffeine fix every morning, and they don’t want to make it at home. They like the convenience and the taste of their favorite coffee shop.

Another reason is that it’s a social thing. Coffee shops have become more than just places to get a drink. They are also places to meet friends, work, study, or relax. They offer a variety of options, from lattes to smoothies, and they have a cozy atmosphere.

I don’t think there’s anything wrong with treating yourself to a coffee once in a while, if you enjoy it and can afford it. I also don’t think it’s smart to obsess over saving every penny. Life is meant to be enjoyed, not just endured.

But I do think it’s worth thinking about the opportunity cost of your spending habits. What if you invested some of that money instead of spending it on coffee? How much could you grow your wealth over time?

I saw this image on LinkedIn the other day, and it really made me think.

The image shows how much money you could have if you invested $5 a day for 40 years, at different rates of return. The difference is huge!

The point is not that you should never buy coffee outside. The point is that you should be aware of the trade-offs you are making with your money. Every dollar you spend is a dollar you can’t invest.

This is even more true for bigger expenses, like cars or houses. Do you really need that luxury car or that big house? Or would you rather have more money in the stock market, earning passive income?

From a financial perspective, the answer is clear.