Or you assume that the coffee is the only part of the experience that counts. I gladly pay $5 for my morning coffee, because I really enjoy the shop. I could drink coffee at home, no problem, but I like going to the shop and reading the news and waking up there. I know I'll see people I enjoy. I actually have to get dressed/ready for my day to get out of the house so I'm not as likely to just be lazy. The window I sit in catches the morning light In a way that I find pleasing. In the warm months I can sit on the patio and enjoy the weather.

Or I could spend $1 or less on my morning coffe that doesn't taste as good, and not wake up in the same, refreshing way, and be overall less productive.

Oh, and I still manage to save 20-30% of my overall income (depending on the month). Lattes don't matter. Overall spending habits and and fiscal approach do.

Another important aspect to consider is that penny pinching will make you feel miserable and will often add so much additional hassle as to not be worth it.

For instance, saving 50 euro on airline travel ... not worth it if you can afford the extra 50 euro.

Some people feel stylish with their $5 coffee. It's not all about the taste.

There is a word that describes perfectly these kind of people - snobs.

I could understand someone that tells me his 5$ coffee tastes "better". But if you drink your 5$ coffee just because you are feeling stylish ...

To quote Tim Ferriss, "It's OK to want [a motorbike] because it makes you feel like a cool dude.".

If something makes a person happier, it makes them happier.