One of my favorite topics
The latte factor is my latte factor. BS pop-culture personal finance advice that misses the point. The math behind the “latte factor” is specious at best, and assumes its conclusion as supporting evidence.
Reducing entertainment consumption is problematic for two reasons - 1) you shouldn’t waste your time on entertainment consumption to begin with, if you are, you’re already behind and passing up on your “latte” is not going to solve the underlying problem - in other words, are you trying to get ahead or just less behind? reducing consumption this way just helps you stay less behind and provides no means to get ahead. 2) this type of consumption should drive improved outcomes through networking and relationship building, so rather than reducing your “latte factor”, you should seek to increase it and use it to improve your relationships, network, and learn.
Meet a mentor for coffee. That $10 latte (one for you and your mentor) pays for itself in spades. Meet like-minded real estate investors for dinner. You only pay for your dinner, and again, it pays for itself in the education you receive. Meet entrepreneurs and members of the VC community for a lunch-and-learn. Or, save the $10 and gain nothing.
This is not to argue that you must spend money to build a relationship, only to argue that you’re doing it wrong if you’re spending this money and not working to build relationships, or if you’re seeking to remove this opportunity from your arsenal in order to save a few dollars. Don’t step over dollars to get to dimes.