How that cafe coffee a day could cost you $71,000

IF you knew your daily cup of coffee was costing you in excess of $70,000, would you break the habit?

BONUS: Giving up one coffee a day could help your mortgage. Picture: Trevor Veale

IF you knew your daily cup of coffee was costing you in excess of $70,000, would you break the habit?

Well the numbers have been crunched, and according to RateCity.com.au, by giving up one coffee a day and putting the money into your mortgage you could be $71,891 better off over the lifetime of the loan, or 30 years.

It's a huge figure, but is it enough to change habits?

Sally Tindall from RateCity said most people have no idea how much of an impact extra repayments can have on your mortgage.

"We wanted to show that if you squirrel away a small amount each week, it can knock years off your loan. It's also something most of us can easily do with very little effort.," she said.

"Buying an extra cup of coffee or a bottle of water is often just mindless spending. If you save that money you'll be shocked by the results."

According to RateCity there are further savings to be made on our mortgages through simply weekly saving hacks and then rolling the cash you'd otherwise have spent into your home loan.

Bottled water is another money-sucker, but by swapping $3 bottled water everyday for tap water, the savings equated to $62,266 over 30 years.

The figures are based on a $300,000 mortgage over 30 years with an average rate of 4.31 per cent. It also assumes that the money saved from buying the item is put towards paying off the mortgage so that the saving is not just on the cost of the item, but the interest charges avoided by investing the money.

The savings are also significant when it comes to cutting back on the booze. The study found giving up one $20 bottle of wine each week and rolling the money in your mortgage, the savings are $59,482 over the life of the loan.

When it comes to beer, ditching one six-pack a week and saving the cash put you $59,482 ahead, while going without a carton a week saw the biggest savings of all the tips at $137,342 over the life of a home loan.

The debate over the smashed avocado generation is also addressed in the report. It found that ditching breakfast out once a week can save $59,482. "By making additional mortgage repayments you effectively shorten your loan term - that means you are taking the razor to your interest bill," Ms Tindall said.

"If you can save as little as $20 every week and roll that money into your home loan you could be ahead by $59,482 over 30 years.

"Work out how much you can save each week and set up an automatic bank transfer. Then forget about it. The real reward comes with time. "Paying off a mortgage can seem like climbing a mountain, but there are always simple things you can do to help get ahead," she said.