The Total Cost Of Living

It’s 2017 and easier than ever to buy almost anything you want.

For bigger purchases, like cars and houses, we can browse and research online, and plug our options and numbers into impressive calculators that will tell us our monthly payments, interest, expected maintenance costs, etc.

When you buy a car, you can see not just the purchase price, but what’s called the Total Cost To Own – a breakdown of how much insurance, gas, upkeep, and even deprecation will cost you over 5 years, based on which car you want.

Total Cost Of Living

But when it comes to regular purchases, there’s not a lot of consideration when it comes to long term costs-to-own.  It’s mainly retirement calculators – like the latte factor, which tells you how many tens of thousands of dollars you’ll have if you forgo the daily latte and invest that money instead.

And when you hear “cost of living calculator”, your mind jumps to how much lifestyle you could afford in another city…

Planning for something like retirement, especially if you’re young, isn’t exactly exciting.  Humans prefer not to spend a lot of time thinking that far ahead.  We like big wins, big progress, doing big things.  Even though our lives are mostly directed by patterns, habits, routines, and little slices of time.


Total Cost To Own calculators are easy.  And I would like to think they make a difference in a least a few peoples car buying decisions.

So what if there was a way to calculate the total cost of your lifestyle?  Not just your monthly bills, but a way to see the cost of every decision (because every decision is a money decision (link)) not just at the moment of truth, but over months and years?


There are resources and calculators for the big things like retirement, housing, cars, and debt and interest.  But what about the little things?  The routines, habits, how you spend all those small slices of time.  The real cost of how you live?

What if the “latte factor” wasn’t just trying to convince people of the power of habit by simply showing the compounded value of monetary indulgences?

The Total-Latte-Cost-Factor-Calculator would include, yes, the dollars traded for the coffee.  It would also take in to account all the other outcomes of such a habit (do you use the drive thru instead of getting in an easy couple hundred steps?  How could those extra 200 steps and the 5 minutes standing and waiting instead of sitting in an idling car impact your health in a single day?  What about the added sugar on your health, the extra gas burned and emissions produced, the paper cups thrown away?  What about compounded over weeks, months, years?).

Striving to be more mindful about our consumption (financially and material) is a step in the right direction.  Mindfulness promotes thinking about effects and consequences of our actions.  But it can’t match the power of the calculator, with numbers and dollar signs and undeniable answer to the question “How much does it cost to live like you?”

3 Comments

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  1. So true! I like the concept of making mindful consumption of things. Putting thought behind every purchase is necessary to reach FI.

  2. Excellent point. I think it’s crucial for us to realize that we don’t need much to survive. Humans have gotten by just fine without cars for thousands of years, after all. 😉

    • I agree. Really thinking about words like “surviving” and “sustaining” helps when you’re reflecting on your lifestyle rather than just living it.

      Thank you guys for reading!

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