The Latte Factor

Is $1 million really better than a good cup of coffee?

Someone has trademarked the phrase “The Latte Factor,” referring to his claim that you could save the $3.50 a day you’re spending on little things like coffee, invest it, and wind up with millions of dollars.

I don’t doubt that under a certain set of assumptions, that’s true — although under another set of assumptions, you could invest the money and lose it all, in which case you’ve got no lattes and no money).

But the real flaw in this theory is the underlying assumption that having millions of dollars is somehow better than having a latte.

I’ve never seen any evidence that people who have a great deal of money are any happier than people who don’t.

I look at the news and I see every celebrity in Hollywood in rehab, rich people getting married and divorced over and over again, rich families who all hate one another, business executives making $10 million a year and they’re on CNN in handcuffs for trying to steal a few million more.

And so on.

A recent paper published in the Proceedings of the National Academy of Sciences concludes, based on 28 years of data, that we derive happiness from friends, family, and good health, but not from accumulating a lot of money.

What happens is that material wants increase along with wealth, leaving us no happier than we were before.

And since hours per day is a fixed quantity, the more time we allocate to the pursuit of riches, the less time we have to spend with friends and family, creating a double whammy of discontent.

Back to lattes: I don’t drink them, but I do like to start the day with an iced coffee, and sometimes when I get just the right amounts of sweetener and cream and I feel the caffeine starting to kick in . . . oh man, it’s the best thing that happens for me all day.

In other words, I know that people are getting some pleasure from the coffee. The millions of dollars, I don’t really think so.

So I would not advise anyone to give up the little things that help them get through the day, live a joyless existence for decades, in the hopes that someday — someday — they’ll have lots of money and be happy, because I don’t think it’s going to work out that way . . .