The Latte Factor
If you ever heard of David Bach, author of Automatic Millionaire, you should also heard of Latte Factor. It is his personal finance advise trademark which can lead you to become a millionaire automatically one day.
So what is the secret of The Latte Factor? The Latte Factor teach us to save money on a small matter which usually being neglected by people. Let say you have a latte every morning. You spend $6 for a latte in a day, $42 for a week, $168 for a month, $2016 for a year and $60480 for thirty years. On the other hand, what if you do not have latte from the first day? The answer is you could just save $60480 after thirty years. This is what David Bach teach his students on financial seminar how to become millionaire automatically.
The Latte Factor concept can also apply in Malaysia but the money saved is not on Latte. I don’t think that most Malaysian having habit of drinking latte every morning. How about cigarette? A pack of 20’s of cigarette would cost around RM10 for branded. If a smoker having a box per day, RM10 used in a day, RM300 per month, RM3600 per year and RM10800 after thirty years! What if you do not smoke start from the first day, you could easily save up to RM10800 automatically.
Maybe you will say RM10800 is still far from millionaire dream but cigarette is just one of the many things you can save on daily expenses. I am sure there are more to apply. Therefore, millionaire is really not a dream only if you are discipline enough.
Do you know that David Bach’s Latte Factor is now a joke among financial writers and advisers? Check out Remit “I will Teach You To Be Rich” Sethi’s and “Save Big” author Elisabeth Leamy.
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Mrcoolku Reply:
January 17th, 2010 at 6:15 pm
Whatever it is, maybe some people did get financial freedom through the implementation of The Latte Factor. It is no harm to know more.
Both sites given are really interesting to find up. Thanks for sharing.
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I second your article. =)
Altho the amount might seem insignificant initially, but in the long run, all numbers matters right. Esp if its of repetitive nature. Those are the one’s we shud be aware of too!
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Mrcoolku Reply:
January 17th, 2010 at 6:17 pm
Sikit sikit lama lama jadi bukit. It is one of the ways to get rich and financial freedom.
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I suggest to BYO lunch instead of having outside during lunch time and it will save you more than RM2,000 a year on expenses of lunch and petrol. I think this is every effective for non-smokers and additional savings for smokers. ^ ^
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Mrcoolku Reply:
January 21st, 2010 at 12:54 am
I agree. I bring my own lunch most of the time unless I am in a hurry. Haha… Seems like we are quite alike. Save and invest.
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I like this idea – because it gives us extra money to invest. The act of saving money alone would not make us lot richer but if coupled with investing money, it would. My wife & I studied our spending habit to see areas for (further) cost reduction. We do the cost reduction. And we spend the excess (income-spending) to accelerate debts settlement/payment and to boost investment.
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Mrcoolku Reply:
February 13th, 2010 at 11:10 pm
Seems like you have a nice wife that share same dream with you. Smart couple finish rich.
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sourplum Reply:
April 29th, 2010 at 2:23 pm
i wish i can have a wife who can understand my financial goal
=)
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Mrcoolku Reply:
May 1st, 2010 at 7:49 am
If you don’t have, you can educate her. I am educating my gf also so that we have the same goal.
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