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I was recently talking to a group of friends having some freshly brewed Florida IPA’s. One of them posed the question “I wonder how much money I have spent in my lifetime on alcohol?”
It is one of the oldest bar discussions in the book. “I would be a millionaire if I stopped drinking booze” Or, “I wonder how much money you would save if you stopped drinking alcohol.”
Well, my friend, you are in luck. We are going to solve this mystery together once and for all. So kick back with your favorite drink of choice, this may sting a little bit.
Because taking into account how much you can save is fine. The question really is, what would happen if you invested all the money that you spend on Alcohol.
How Much Would you Save if you Stopped Drinking
Drinking can be an expensive hobby. In fact it can cost you 7-figures over your lifetime if you are not careful. But, it is not just the drinking costs that you want to consider.
Think about all the UBER’s you take because of drinking. All the dinners and fast you buy after a night out. There is a compound effect to alcohol that can add up!
Taking into consideration that would invest this money with an 8% return, here is how much drinking can cost you:
| Monthly Spend | 30 Years | 40 Years |
| $50 | $70,427.53 | $161,053.97 |
| $100 | $140,855.06 | $322,107.93 |
| $150 | $211,282.59 | $483,161.90 |
| $250 | $352,137.65 | $805,269.84 |
| $400 | $563,420.23 | $1,288,431.74 |
| Dollarafterdollar.com |
You Spend $50 a month on alcohol (The Stay at home drinker)
The stay at home drinker is known to grab a 6-pack at the liquor store and throw back a few while watching sports or a movie. Or, it can be a casual drinker who only has a few drinks per month. They may have a beer/glass of wine when out at dinner but never get too crazy.
Spending $50 a month is still nothing to sneeze at. Over the course of 30 years, you will forgo $70,427. Over the course of 40 years, you will have spent $161,000!
| Year | Start Balance | Interest | End Balance |
| 1 | $0.00 | $21.69 | $621.69 |
| 5 | $2,801.42 | $245.81 | $3,647.23 |
| 10 | $7,763.44 | $642.77 | $9,006.21 |
| 15 | $15,054.28 | $1,226.04 | $16,880.32 |
| 20 | $25,766.91 | $2,083.06 | $28,449.95 |
| 25 | $41,507.27 | $3,342.28 | $45,449.55 |
| 30 | $64,635.03 | $5,192.48 | $70,427.53 |
| 35 | $98,617.30 | $7,911.07 | $107,128.38 |
| 40 | $148,548.40 | $11,905.56 | $161,053.97 |
| Dollarafterdollar.com |
You Spend $100 a month on alcohol (The Stay at Home + Occasional bar Drinker)
The $100 a month drinker spends the majority of their time having drinks at home but may head out to the bar once or twice a month with friends. It doesn’t take a huge amount to hit $100 a month. If you think you don’t fall into this category because you only have a few drinks a weekend, you may want to check your bank statement. Two bottles of cheap wine a week can get you to $100.
If you spend $100 a month on alcohol you will have lost out on 214,256.00 in 30 years. In 40 years, you would have lost $322,107.93. This is the power if small amounts of money are saved and invested over a long period of time.
| Year | Start Balance | Interest | End Balance |
| 1 | $0.00 | $43.37 | $1,243.39 |
| 5 | $5,602.85 | $491.61 | $7,294.47 |
| 10 | $15,526.89 | $1,285.52 | $18,012.43 |
| 15 | $30,108.56 | $2,452.07 | $33,760.63 |
| 20 | $51,533.81 | $4,166.09 | $56,899.91 |
| 25 | $83,014.54 | $6,684.55 | $90,899.10 |
| 30 | $129,270.06 | $10,385.00 | $140,855.06 |
| 35 | $197,234.60 | $15,822.16 | $214,256.76 |
| 40 | $297,096.80 | $23,811.12 | $322,107.93 |
| Dollarafterdollar.com |
What if you spent $150 a month on alcohol (The Bar/restaurant Drinker)
Spending $150/month on alcohol is easy to do if you drink outside of the house. As we know, restaurants make a large percentage of their profits on alcohol. Having a few drinks on a date every weekend will easily hit this mark.
If you spend $150 a month on alcohol you will forgo $211,282 in 30 years and $483,161 in 40 years. In 40 years, we are now approaching half a million dollars.
| Start balance | Interest | End Balance | |
| 1 | $0.00 | $65.09 | $1,865.08 |
| 5 | $8,404.27 | $737.43 | $10,941.70 |
| 10 | $23,290.33 | $1,928.31 | $27,018.64 |
| 15 | $45,162.84 | $3,678.11 | $50,640.95 |
| 20 | $77,300.72 | $6,249.14 | $85,349.86 |
| 25 | $124,521.82 | $10,026.83 | $136,348.64 |
| 30 | $193,905.10 | $15,577.47 | $211,282.59 |
| 35 | $295,851.90 | $23,733.23 | $321,385.14 |
| 40 | $445,645.20 | $35,716.70 | $483,161.90 |
| Dollarafterdollar.com |
The $250 a month drinker (The Fancy Bar/bottle Drinker)
The $250 a month drinker more than likely likes fine wine and spirits or frequents the local martini bars. Spending this much every month has a real impact over the long run.
If you spend $250 a month on alcohol, you will lose $352,137 in 30 years and $805,269 in 40 years. This is a huge jump as you can forgo almost a million dollars!
| Year | Start Balance | Interest | End Balance |
| 1 | $0.00 | $108.48 | $3,108.47 |
| 5 | $14,007.12 | $1,229.04 | $18,236.16 |
| 10 | $38,817.22 | $3,213.86 | $45,031.07 |
| 15 | $75,271.39 | $6,130.20 | $84,401.58 |
| 20 | $128,834.53 | $10,415.24 | $142,249.77 |
| 25 | $207,536.36 | $16,711.39 | $227,247.74 |
| 30 | $323,175.16 | $25,962.48 | $352,137.65 |
| 35 | $493,086.50 | $39,555.40 | $535,641.89 |
| 40 | $742,742.00 | $59,527.82 | $805,269.84 |
| Dollarafterdollar.com |
The $400 a month Drinker (The Clubber)
The $400 a month drinker is a high roller. They love to fistpump in the club. They are out every weekend, buying extremely overpriced drinks for their friends. They are just having a good time. They live for the now instead of the future.
Think about the club scene for a second. One drink can cost anywhere from $8 – $15. That means you have about 8 drinks a weekend to hit $400 a month. If you are buying drinks for friends, this can be even more! Once you see the numbers, you may want to cut back on spending that kind of money on booze.
If you spend $400 a month on alcohol, in 30 years you will have spent $563,423. In 40 years, you will have spent $1,288,431 on alcohol!
| Year | Start Balance | Interest | End Balance |
| 1 | $0.00 | $173.54 | $4,973.55 |
| 5 | $22,411.39 | $1,966.47 | $29,177.86 |
| 10 | $62,107.55 | $5,142.16 | $72,049.71 |
| 15 | $120,434.23 | $9,808.30 | $135,042.52 |
| 20 | $206,135.25 | $16,664.37 | $227,599.63 |
| 25 | $332,058.17 | $26,738.22 | $363,596.38 |
| 30 | $517,080.26 | $41,539.98 | $563,420.23 |
| 35 | $788,938.40 | $63,288.63 | $857,027.03 |
| 40 | $1,188,387.21 | $95,244.54 | $1,288,431.74 |
| Dollarafterdollar.com |
Tips to Cut Back Spending on Alcohol
There are a few ways to cut back on spending money on alcohol. When looking at the average price of an alcohol in each state, you can see why many people may be spending too much. Here are some tips to reduce how much you blow on booze:
Drink Less
Having a large number of drinks is not the best for you. That being said there is nothing wrong with having a few a week. If you find yourself spending a massive amount, set a limit for yourself. Setting parameters allows you to still enjoy alcohol without all the negative side effects. Allowing yourself no more than 2 drinks a day, or 6 drinks per week will allow you to control your consumption. Another hack would be to drink every other week, or only allow yourself to drink socially.
Drink at Home
Drinking at home is much cheaper than drinking at a bar. In fact it is about 80-90% cheaper. Take a beer for example. At the bar, it will cost you $5-$7. Where if you have a beer at home, it will cost $1-$3. If you are going to drink on a weekly basis, you are better off drinking at home the majority of the time.
Stop Buying Rounds for Friends
Buying drinks for friends can be fun at times. But, buying rounds consistently can put a big dent in your savings. One round of 5 drinks can cost you anywhere from $30- $60. Doing that once a month would cost you 6 figures in retirement! It’s not worth it.
Never Buy Shots at Bars
Shots are expensive. They usually come in groups of friends and are never worth the cost. A round of shots can easily cost the same as a round of drinks and they are done in one second or less.
Go to Happy Hour
Happy hour is always cheaper. They are filled with 2 for 1’s. Now your $5 beer costs 2.50. Why not get the same thing for half the price? It is the best of both worlds.
Balance is Key
I am in no way saying to cut out alcohol. There is nothing like having a nice glass of wine after a long week to relax. But, being mindful of how much we spend will allow you to save more so that you can retire with a much larger nest egg. Maintaining a balance with how much you drink is beneficial for your health and wealth.
Andrew is the host of The Personal Finance Podcast, a show that is changing the way you think about your money. His primary goal with the podcast is to bring as much value as possible to his listeners.
Andrew's favorite free financial tool he's been using since 2014 to manage his net worth is Personal Capital. Each month he uses their free Investment Checkup tool and Retirement Planner to track his investments and ensure that he's on the fast track to financial freedom.
His favorite investment platform is M1 Finance, a site that allows him to build a custom portfolio of stocks for free. It has no trading fees and is his preferred way to invest without having to lift a finger.
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