saving money in Louisville Kentucky

Is that daily latte really a big deal? The answer may surprise you.

Is That Daily Latte Really a Big Deal? The Answer May Surprise You.

By Tracy L. Hirsch

The price we pay to stay caffeinated can put us in the red without even realizing it.

In the daily hustle and bustle of life, it’s amazing how a hot cup of coffee can get us through the day. Having that ‘pick-me-up’ not only increases our productivity, but also gives us that added warmth on these cold fall mornings.

What’s more is how convenient it is to zip through the drive-through on the way to work. There’s nothing like a vanilla latte and a warm, buttery croissant to get you going in the morning.

If this is an occasional treat on the mornings when you’re running behind, it won’t break the bank. However, if this is an everyday event, your wallet is significantly lighter than you think.

Let’s use the most popular coffee shop as an example. If you go to Starbucks in Louisville, a grande (medium) vanilla latte is $4.15, and a croissant is $2.45. If you add 6% sales tax, that’s approximately $6.80.

While a little less than seven dollars doesn’t sound like a big deal, if this is your go-to breakfast every day, you’re spending about $207.00 a month, which is $2,482.00 a year at Starbucks alone.

Say what? Yes, you read that correctly. Your yearly Starbucks fix costs the same as your total annual car insurance premium. So if you look at it that way, it’s like paying your car insurance premium twice (but for one car).

Even though making your own breakfast and coffee at home is more time-consuming and way less exciting, it could literally help you afford a monthly car or health insurance premium (or other bills such as utilities).

Your favorite latte could be putting your financial stability at risk.

Prioritizing your purchases plays a key role in avoiding massive amounts of debt. Sometimes we need to give ourselves a little bit of tough love when our income is not more than (or at least equal to) what we’re spending. If you’re struggling to pay your bills, look at what you’re spending money on, and determine if it’s a ‘need’ or a ‘want.’

Whether it’s a daily latte, a pair of designer boots, custom rims for your car, or multiple monthly subscriptions to Netflix, Apple Music, Hulu, etc., ask yourself, “Do I really need this?” When it comes to the things I just listed, the honest (and sometimes painful) answer is “no.”

There is always a way to cut back on spending, and while there’s nothing wrong with a small treat here or there, making a habit of buying things that aren’t necessities (i.e. things that fall into the ‘wants’ category) can only lead to trouble… And that includes buying a freshly-brewed cup of coffee every single day.

You don’t have to take my word for it though. Businessman and ‘Shark Tank’ financial investor Kevin O’Leary (whose net worth is approximately $400 million) has the same outlook on that expensive daily cup of joe.

“Do I pay $2.50 for a coffee? Never, never, never do I do that. That is such a waste of money for something that costs 20 cents… I drink coffee, one cup every morning. It costs about 18 cents to make it [at home], and I invest the rest.”

He believes that saving small amounts of money along the way (and also investing) is the key to financial stability:

“The truth is, there is a lot of crap you don’t need. What I’ve learned to do, and what has really helped me in maintaining growth in my own personal investing is, anytime I pick up something I’m going to buy, I say to myself, ‘Do I really need this?’

In the age of consumerism, where there is now a blurred line between needs and wants, it’s important to stay grounded in reality. There are a few ways to do that, including opening a savings account and creating a budget. Additionally, you should invest in a retirement fund to ensure that you’ll have a financially stable future.

I know it’s hard to give up that daily freshly-brewed cup of coffee and croissant. However, a 12-pack of croissants at Costco is $5.99. That’s only 50 cents per croissant! Compared to the $2.45 you’d be spending on a croissant at Starbucks each day, that saves you $712 a year.

Buying a bag of coffee at Costco also saves quite a bit of money. Spending 20 cents per day on ground coffee (as opposed to the $4.15 latte) saves you $1,442 a year.

The bottom line is that buying those things at Costco comes to about $256 a year (instead of $2,400 a year at Starbucks). The amount saved is astounding! When you think of the other “small” purchases that you make throughout the week, such as eating out, think of how much money you’ll save annually by cutting back on that too.

While cutting out the “extras” can be painful at first, we miss those things less and less once we see more money in our bank account throughout the year. Additionally, it helps us change our spending habits to do more saving and less spending.

When that happens, you’re less likely to get in over your head in terms of debt, which leads to less stress (and we could all use less of that in our lives).

What else do you do in order to save money every day? Are there any local stores in Louisville (in addition to Costco) where you consistently find bargains? Share your thoughts with us in the comments below!

All the best,

Tracy L. Hirsch


Need a free consultation? Text or call me at (502) 435-2593!

Car Loan

The Dangerous Side of Car Loans

The Dangerous Side of Car Loans

By Tracy L. Hirsch

Here’s how long-term car loans can lead to massive debt, and why you should avoid them.

Purchasing a car can be a stressful ordeal if you don’t have the funds to pay cash. If you have good credit, then you’ll probably be able to secure an auto loan at a good interest rate, as long as the term of the loan is a reasonable length.

When working with a car dealership, they’re of course going to try to convince you to buy a car that’s outside of your budget.

It can actually be tempting now that lenders are offering 72-month and 84-month loans. While it initially looks like a good deal since your monthly car payment will be lower when it’s spread out over 84 months compared to 48 months, it’s usually too good to be true.

Here are three reasons why long-term car loans aren’t a good idea.

1. You are automatically “upside down” financially. This means that the amount you owe to your lender is more than your car is actually worth. The longer the payback period is on the car loan, the more interest you’ll be paying. In addition to that, if the amount you’re borrowing is on the high side, your interest over the length of the loan will be exorbitant.

For example, if you take out an 84-month loan for a $45,000 new car at 7.5% interest and $0 down, you’ll be paying a whopping $13,000 in interest over the next 7 years (and have a $700 a month car payment during that entire time).

Since cars depreciate quickly, adding an additional $13,000 in interest to the purchase price (as well as thousands of dollars in taxes, titles, and fees) puts you in the negative in terms of equity. The bottom line is that the shorter your loan length is, the more quickly you’ll build up equity in your car.

Long-term car loans may look appealing, but they come with a steep price (literally).

2. Your interest rate will be higher if your loan is longer than 60 months. According to car experts like Edmunds, borrowers pay higher interest rates when the length of their car loan is extremely long (72 or 84 months).

Additionally, studies have shown that when borrowers sign up for a longer loan, they’re tempted to borrow more money, which means they end up buying a car they can’t afford.

To be direct, if you can’t afford the monthly payments for a 48-month or 60-month car loan, then it’s time to look at a less expensive car. If the only way that you can afford the payments on a car is to pay it over an 84-month period (that’s seven years), then it’s not a wise investment.

3. You’ll end up paying for repairs while still making your monthly car payments. A car that is seven years old will probably have close to 80,000 miles on it. The more miles you have, the more likely it is that you’ll have to invest money in maintenance and repairs.

If you can barely afford a monthly payment on a 7-year loan, you won’t be able to afford any necessary repairs that come with it.

If we use our previous example shown in point #1, your $700 a month car payment would be all the more painful even if you had a relatively “small” repair that costs $800.

Paying $1,500 in one month on the car alone would put most people in the red in terms of their monthly budget. Groceries, insurance premiums, and a mortgage payment take up most paychecks, and a car payment and repairs shouldn’t be equivalent to that amount.

So is it possible to get a car loan that won’t harm you in the long run? Yes!

Car loans can be a major blessing if you live within your means, and financing a car responsibly is the foundation for making a wise investment. While most of us would rather drive a Range Rover than a Hyundai Elantra, we have to stay grounded in reality in terms of our budgets.

While driving a fancy car may feel good in the moment, you’ll feel ten times better knowing that purchasing the Hyundai will save you thousands of dollars in interest and monthly payments.

Ideally, it’s best to take out a car loan that can be paid in 48 months or less. For example, if you can do it in 36 months, you’ll not only save on interest, but you’ll also be done with your car payments after three years.

That’s something to look forward to, as your car will most likely still be in great running condition in three years as opposed to seven.

All that to be said, if you’re currently in a situation where you’re behind on your car payments, or your car has been repossessed in Kentucky or southern Indiana, all hope is not lost. You can try to refinance, or, if you have other debts that can’t be paid, you can file for bankruptcy.

I offer free consultations, where we can discuss your options. More often than not, I can help you keep your car, and negotiate a much lower interest rate on your car loan through a bankruptcy plan.

You can call or text me on my cell phone at (502) 435-2593, and together, we can figure out a plan that works for you!

All the best,

Tracy L. Hirsch


Call or text me directly at (502) 435-2593 to get started!