Do you know your latte factor?
That's a question best-selling author David Bach asks in his books, the most recent of which is The Automatic Millionaire.
The latte factor refers to how much a person might spend on a fancy coffee each morning. In your life, there are probably such small but regular purchases that add up to big money leaking from your household budget.
It was no accident that Bach chose a dining-out item to illustrate the point. An American family of four spends more than $3,000 a year on eating out, according to government statistics.
Is it really worth cutting back? In the latte example, a $3.50 latte every morning for a year adds up to nearly $1,300. Eating-out spending has evolved. It wasn't long ago that there wasn't an upscale coffee shop on every corner. "We made coffee at home, and it was fine, and it cost a nickel," Bach said.
And if just a decade or two ago an entrepreneur broached the idea of selling water in a sealed bottle and charging people 100 times what it was worth, he would have been laughed out of business.
Beverages are notable budget drains.
One credit counselor knew a family with limited income and serious debt problems that was spending more than $100 a month on soft drinks at convenience stores. Until they examined their spending, they had no idea that they were spending that much, said Dave Jones, president of the Association of Independent Consumer Credit Counseling Agencies.
Nobody would begrudge you a dinner out to celebrate a birthday, anniversary or job promotion. But cutting down on prepared meals, whether at a restaurant or by ordering a pizza, is among the best ways to save significant money, personal finance experts and professional cheapskates agree.
Of course, the answer to not eating out is eating in, or at least preparing meals at home that you take with you.
Yes, that means spending a few minutes to make a brown-bag lunch for work. And take a beverage, too. A soft drink from a vending machine at work could cost $1 per can, while buying it on sale at the grocery store could cost less than 20 cents. That's a savings of $200 a year on lunchtime soft drinks alone.
It also means spending effort on meal planning, specifically dinner.
Planning helps eliminate impulse dining out, when mom or dad comes home too tired to make dinner. Without planning, it's easy to fall back on trips to the fast-food joint and calls for Chinese takeout or pizza.
To make frequent cooking easier, use freezer meals. That's a concept of cooking two or three times what you need for dinner. It takes little extra effort to make more because the ingredients and cookware are already out, and cleanup is about the same.
Instead of making a meat loaf, make two or three. Triple the recipe for a casserole or make 20 hamburgers at a time.
Freeze the extra food, and on those nights you don't feel like starting from scratch, grab a freezer meal and microwave it. It ends up being much cheaper and quicker than eating out, and could be more healthful, too.
And for those times you do go out to dinner, some tips can keep the bill reasonable, said Eric Tyson, author of Personal Finance for Dummies.
The biggest is cutting down on alcohol. Having a glass of wine before you leave for the restaurant might satisfy your urge for a before-dinner drink, Tyson said.
If you can forgo the appetizers, skip the dessert and say no to the after-dinner coffee, you can eat excellent entrees at upscale restaurants without breaking the bank.
And don't forget, the water's free.
Gregory Karp is a personal finance reporter for The Morning Call in Allentown, Pa., a Tribune Publishing newspaper. E-mail him at email@example.com.