In the past year, the price of a pound of coffee beans has more than doubled on the commodities market in New York, to $2.23 a pound as of Thursday, May 24th of this year. Roiled by everything from changes in the Brazilian crop to the cost of transportation from Africa to increasing demand from a growing middle class in China and India, the fuel of choice for many has become so precious there are reports of thieves stealing containers of beans at ports or even stripping trees in the fields. (source: m.knoxnews.com) What it has meant to most of us is that cups of coffee you get at Starbuck's or Dunkin' Donuts will be rising as well as the coffee you bring home in the supermarket.
So what can you do to make a smart money moves during times when your favorite beverage of the day is soaring through the roof?
- Save last night's coffee - The apple must not fall far from the tree as recently at my sister's house I noticed she kept a stack of disposable coffee cups in her pantry. When I asked her why, she told me that she found it to be a good idea now money wise to save the pot of coffee she makes that day and either use it during the summer to make iced coffee or just reheat a cup on the go for the morning drive. What a great way to save money.
- Grab a cup of joe at work - If you are lucky enough to have an employer who stocks the lunch room with a coffee machine or a coffee supplies to make a fresh pot coffee, it may be better to wait to get your first cup of coffee when you get to work. Even more important, you may grab one to go when the day ends if you are used to getting something on the way home or have a cup at night. It may not be your favorite brand, but it sure will help impact the bottom line.
- Go smaller - Most days you may just order a large or a venti when you go to your favorite neighborhood coffee shop. By just ordering a smaller version, you may be able to save as much as a dollar per cup. Do that every day of the week and you can still get your coffee fix while saving $250 a year.
- Go teaspoon versus tablespoon - I have made hundreds of pots of coffee at work. Unless you like your coffee really strong, using a teaspoon versus a tablespoon will still get you a great pot of coffee. You'll still have the rich strength to the coffee you drink, but your coffee supplies will last twice as long.
I know that most people say inflation is still really low, but at the grocery store we are all starting to see the jump in prices for our daily goods. Coffee has doubled in price in the just the last two years, and who knows where prices may end up two years from now as more emerging countries are developing and drinking coffee as their daily beverage. In the meantime, make a few of these smart money moves to help you increase the bottom line.
Ted Jenkin, CFP®, AAMS®, AWMA®, CRPC®, CMFC®, CRPS®
Co-CEO and Founder oXYGen Financial, Inc
oXYGen Financial, Inc. co-CEO Ted Jenkin is one of the foremost knowledgeable professionals in giving financial advice and Smart Money Moves to the X and Y Generation.
Phone 1.800.355.9318 or 770.777.0427
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