Now might be a great time to get back on track with plans to quit smoking, give up that daily doughnut, or cut back on calories or little luxuries. While many people realize the physical benefits of these changes, few consider the monetary rewards that can be gained.
Cutting back a few indulgences can significantly help grow a nest egg, said Bryan Olson, Vice President, Schwab Center for Investment Research. Trade in that grandé mocha for a regular coffee and invest the few dollars you save each week. The power of compounding means that just a few dollars invested can help you get closer to realizing your financial goals.
The Schwab Center for Investment Research looked at the impact giving up a few indulgences might have on bottom line savings. While the researchers took a light-hearted approach, what they found was anything but light. Making small lifestyle changes today can significantly improve physical and financial health over the long term. Here are a few examples:
Wake Up And Smell The Coffee
Think you cant start your day without a grandé mocha? Here are some reasons to trythe 107,900 calories youll miss every year if you switch to black coffee five days a week, or the $442 youll save each year. In fact, if you invest that same $442 for 20 years at an average rate of 10 percent a year, youd earn more than $27,000.
Dough Re Me
As long as were talking about morning habits, lets talk bagelsthis research is, after all, about dough. According to Schwabs calculations, if you choose to skip the cream cheese shmear three times a week, youll drop 30,888 calories plus save $179 a year. Invest this in an account that grows at 10 percent a year and in 20 years, youve got $11,302.
Going out to dine this week? If you say no to the shrimp cocktail and desert the dessert table just once a week for a year, youll be $676 heavier in the wallet, and 21,500 calories lighter around the belly, thighs or hips. Invest this amount for 20 years, using the same calculations cited above, and you might be able to buy a lot more than chocolate cake with the $42,589 youll have accumulated.
For the full report visit www.schwab.com/doughnutstodollars.
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