4. You can build a fortune on a few dollars a day.
"The trick to getting ahead financially is watching the small stuff — little spending habits you have that you'd probably be better off without," Bach writes. "Most of us don't really think about how we spend our money — and if we do, we often focus solely on the big-ticket items while ignoring the small daily expenses that drain away our cash ... We don't realize how much wealth we might have if, instead of wasting our income, we invested just a little of it."
He illustrates this idea with what he calls "The Latte Factor," which basically says that if you ditch your $4 latte every morning, you'd have quite a bit of money to contribute towards savings — about $30 a week, or $120 a month. Over the course of a few decades, that money could grow substantially.
"Whether you waste money on fancy coffee, bottled water, cigarettes, soft drinks, candy bars, fast food, or whatever it happens to be — we all have a Latte Factor," Bach writes. "We all throw away too much of our hard-earned money on unnecessary 'little' expenditures without realizing how much they can add up."
To give you an idea of how much money you could have if you identified and eliminated your Latte Factor, he gives the example of making a $5 purchase (the average cost of a latte and a muffin) each day, which would cost you $35 a week and about $150 a month. If you invested that $150 instead, assuming a (very generous, admittedly) 10% annual return, you'd wind up with $30,727 after 10 years, $339,073 after 30 years, and $948,611 after 40 years, he explains.