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Five Ways to Cut the Cost of Your Coffee Addiction

Written by Hank Coleman - 16 Comments

Five Ways to Cut the Cost of Your Coffee Addiction

Gourmet coffee is still one of the favorite villains of every financial expert looking for something to blame for Americans’ overspending or lack of retirement savings. Ever since David Bach introduced the concept of the Latte Factor in his bestselling book, “The Automatic Millionaire“, the public’s love of fancy coffee has become a favorite whipping boy of frugalistas everywhere.

While it has grown old and tired to continually beat up expensive coffee as a financial vice, the American public’s love for gourmet coffee hasn’t diminished. According to the National Coffee Association’s 2011 National Coffee Drinking Trends Study, 37% of all the coffee consumed in America is gourmet, with 24% of coffee drinkers getting their fix from a barista at the local coffee house instead of at home.

There is little denying that gourmet coffee can be expensive, but there are several ways that you can save money while still enjoying your favorite caffeinated beverage. Here are five ways to cut the cost of your coffee.

Reduce the size of your drink

If you simply have to purchase your favorite latte or coffee at your local coffee shop, you should consider downgrading to a smaller size cup. Reducing your purchase from a large cup of coffee to a small one can reduce your costs significantly. For example, a large regular cup of coffee can cost approximately $2.15 in some areas of the country, and a small cup of coffee at the same location can cost as much as $1.50.

Switching from drinking a large cup of coffee to a small can reduce your coffee costs by 30%. While the national average cost for a cup of coffee has recently risen to $1.38 and both national chains and small business owners have been announcing coffee price increases this year, reducing the size of your favorite beverage can be a great way to quickly reduce your coffee costs.

Skip the muffin

Your wallet already takes a hit when you stop at the local coffee shop each morning on your way to work. You only compound the problem when you add other things to your order at the counter. Skipping the muffin or bagel that you order with your coffee can cut your bill in half, and could save you $500 or more over the course of a year assuming you bought a $2.00 muffin on the way to work each day.

Go back to regular coffee

It may be a little hard to believe but, according to the company, a regular cup of coffee is the most popular drink that is ordered by Starbucks customers. It’s not the fancy lattes, iced coffees, and cappuccinos. If you are ordering the fancy stuff, you may want to consider joining the rest of the crowd and ordering a plain cup of coffee. This simple switch is an easy way to curb your caffeine craving while keeping more money in your wallet.

Sign up for rewards programs

Rewards programs seem to be extremely popular recently, whether they reward loyalty at restaurants, local stores, or even coffee shops. Punch cards that offer a free drink after a set number of cups purchased have been popular for years. Now, national coffee chains such as Starbucks are even getting into the act with their own rewards cards and loyalty programs.

Starbucks offers its customers a sophisticated program that includes a gold card with your name on it, free upgrades, a free drink on your birthday, and a free drink after every 15 cups of coffee you purchase. These reward programs can help you save up to 10% on the cost of your coffee that you drink at coffee shops.

Brew your own coffee

Finally, the easiest way to save money on your coffee is the tried and true method of brewing it at home. Typically, one pound of coffee bought in the grocery store will cost approximately $10 and brew 32 cups, for a cost of $0.32 cents per cup. Even the pod-style single serving coffee makers cost $10 to brew 18 cups of coffee for an equivalent of $0.56 per cup. Clearly, if you make your own, you can save a ton.

Coffee drinking has continued to see an incredible growth despite increased costs. According to the National Coffee Association study, the 18-24 age group has seen a 20% increase in daily coffee consumption over the past year, with 40% drinking coffee every day. And 54% of Americans between the ages of 25 and 39 drink coffee daily, which is a 25% increase from a year ago.

What about you? Are you a coffee drinker? If so, do you still buy gourmet coffee from a coffee shop? Or do you make it yourself? What is your favorite way to save money while enjoying coffee on the go?

Published on December 15th, 2011
Modified on December 20th, 2011 - 16 Comments
Filed under: Frugality

About the author: is a freelance writer who has written extensively for many financial websites and publications. Hank holds a Master's Degree in Finance and is actively pursuing Certified Financial Planner status.

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16 Responses to “Five Ways to Cut the Cost of Your Coffee Addiction”

  1. 1
    Des Says:

    I don’t think the appeal of the single-shot coffee makers is per cup price, but that you can brew a single cup. Even the small coffee makers brew 4 cups at a time, at a cost of $1.28 per batch with your numbers. If you only want one cup, and don’t have enough other uses for the rest of the batch, it is cheaper to pay the $0.56 for the single shot. Even if you brew a half batch, the single-shot is cheaper.

    I know my dentist has one of those fancy machines, I assume because it is cheaper for him to let just those customers that want a cup brew their own rather than making a big pot every day.

    And don’t forget the instant coffee option, for those of us with less-refined tastes :)

  2. 2
    John Eisenschmidt Says:

    I drink 1 coffee a day, cold when it’s warm and hot when it’s not. I like a number of different hot coffees, but have a strong preference for the taste of Starbucks iced Americanos (expresso and ice).

    I see a post like this every year around the holidays, about how to save money on coffee. I tried absolutely everything I can make at home, and always end up going back to Starbucks, Dunkin Donuts, etc. I wasted a fortune testing out a Keurig last year (got stuck with the K cups), only to return the machine (whose brew tasted like plastic despite a week of cleaning it with vinegar and brewing with brita filtered water). Coffee makers for household use have to be Underwriter’s Labs (UL) certified, which caps the brewing temperature at 130 degrees, which is not hot enough to extract the full flavor from the beans.

    I’ve given up on trying to save money on brewing my own coffee. I have reusable hot and cold 20oz cups, which save me $0.10 each time I use them at Starbucks (my motivation for reusable cups is NOT to put 350 cups in a landfill every year). With the Starbucks rewards program, every 15 drinks you buy on a Starbucks card earns a free drink, and a free drink on your birthday. I have that setup to automatically reload from my AMEX Blue Cash card, so I’m getting 1.25% cash back on that. I’ve earned 25 free drinks from Starbucks in 2011.

  3. 3
    Sun Says:

    > Sign up for rewards programs

    If you are drinking that much coffee John, you should be loading up multiple accounts. You can double your free drinks if you cycle out cards after you hit the 15 drinks. That would doubling your free drinks. 25 * 15 = 375. You are drinking Starbucks more than once a day?

  4. 4
    Kurt Says:

    For someone making frequent trips to a coffeeshop, the incremental cost of the gasoline burnt is likely more than the incremental coffee cost, compared to homemade. So why are we talking about the coffee? :-)

    Thanks.

  5. 5
    Ren Says:

    My husband and I have a Bunn home brewer — it’s similar to a restaurant-style machine and gets us fresh coffee in minutes. It was expensive, but it “paid” for itself quickly (we got it as a wedding present). While I love going to the coffee shop, I don’t like the money it costs, so I fake my favorite drink at home. I love cinnamon lattes, so I break out my travel mug, add a generous amount of milk, cane sugar and a dash of cinnamon to the strong coffee my husband makes each morning. It’s exactly what I need at exactly the price I can tolerate!

    Of course, when I want a little something special, I visit my good friend who is a barista at a local cafe — I get to visit with her and enjoy my special coffee while supporting a locally owned business. :)

  6. 6
    Steve Says:

    I strongly question the accuracy of any study that indicates a 20% increase in population-wide habits in only one year. We’re not talking about the recent and meteoric rise of smartphones; coffee has been “in” for a couple decades now.

  7. 7
    NoTrustFund Says:

    My husband and I both really like coffee so it adds up if we both buy drinks on a daily basis. While we do buy our drinks a couple of times a week, we’ve had great results using a stovetop espresso machine at home.

    One like this:
    http://www.amazon.com/Bialetti.....amp;sr=8-1

    Can’t recommend it enough and it’s extremely cheap for an espresso machine.

  8. 8
    jon Says:

    If you take coffee and saving money seriously, and have time for a new hobby, look into roasting green coffee beans. Yes, there are start-up costs (depending on how much you want to build your own roaster vs buying one), but having a cheap unending supply of freshly roasted coffee at home is a joy.

  9. 9
    Carma Says:

    No one is considering the obvious. Don’t drink coffee. We have never been coffee drinkers and are happy, healthy and almost best of all pocket the profits.

  10. 10
    Ingrid Says:

    I have to agree with you no this! I have been spending about $22.00 on Starbucks coffee a week. I definitely need to consider buying coffee from Dunkin Donuts its a lot cheaper and tastier!

  11. 11
    Ben M Says:

    I do not go to gourmet coffee places and, honestly, I just don’t get it. For your basic… black… coffee (which is what I like), I wonder if there has been a taste test done? We have Starbuck beans at work and I drink Folgers at home… not much difference.

  12. 12
    Jennifer Says:

    It took me a full year (or even longer) to break my “coffee out” cycle. I used to stop at the gas station every morning for a Starbucks “Frappucino.” I had to stop drinking those, so I started making coffee at home. Sort of. There were mornings I’d be on the ball. There were mornings I’d forget and realize it when I got in my car, so I’d swing by Starbucks. There were mornings where a real Frappucino from the Starbucks drive thru sounded better. I’ve only just recently realized that I’ve been able to break that cycle and I honestly can’t remember the last time I didn’t brew my coffee at home. At about $0.30 per morning (including filter, cream, etc.), I’m saving a ton of money over long periods (I estimate ~$400 per year).

  13. 13
    Newlyfrugal Says:

    I have a Keurig Mini Plus to brew single cup coffees and a Mr. Coffee Cafe Frappe maker to make frappes. I bought both machines on sale at Kohls and got $10 Kohls bucks per $50 purchase to use next time.

    I like the cost savings, but I value more the convenience of brewing coffee and making frappes at home. I can enjoy both anytime without getting dressed and driving to gourmet stores. This saves much time, effort, and gasoline.

  14. 14
    JavaJ Says:

    I question UL only allowing 130 degrees as I have seen steam coming from several coffee makers in my life… anyway, I use a French Press in conjunction with a hot water pot so I know my brew temp is very close to 212. I can make up to 8 cups or as little as one cup, depending on my mood. That is some excellent coffee, extremely reasonably priced. I even put the whole press in the dishwasher, how easy is that?

  15. 15
    sd Says:

    How big is a “cup”? It makes a big difference in the math.

    Most coffeemaker manufacturers usually measure cups of coffee as 5 or 6 ounces (the standard china cup in formal place settings). Most coffee mugs will hold twice that much. And the smallest “cup” of coffee at most coffee places is 12 ounces.

    So double the cost of that home brewing — to duplicate the cup you’re buying at Starbucks or Dunkin’s or Tim’s really costs about 64 cents — or $1.12 if you make two K cups. Still a savings from the other places, but not as much as the author claims.

  16. 16
    Chris Says:

    For a single cup whenever, I use a Melitta filter, which holds #2 papers right on top of my mug, 2 teaspoons of Tschibo coffee ($3.50/12 oz, finely ground)and ALMOST boiling water. Yummm!

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