O’Leary Warns Generation Z $28 Lunches Could Cost $800,000 in Retirement

Kevin O’Leary, the prominent investor and star of ABC’s Shark Tank, has recently criticized a spending habit prevalent among Generation Z that he believes could significantly impact their future retirement funds. In an interview on The Diary of a CEO, O’Leary highlighted the financial implications of splurging on expensive lunches and daily luxuries instead of investing for retirement.

O’Leary emphasized the importance of financial discipline, particularly for young individuals. He pointed out that spending $28 on lunch, which is a common expense for many, could be redirected into an index fund earning an average annual return of 8%. Over 50 years, this small investment could grow to nearly $800,000. This example underscores how small, habitual expenses can accumulate into substantial missed opportunities for wealth accumulation.

The cost of small indulgences, such as expensive coffee and delivery services, can add up quickly, especially for those living in cities with easy access to these amenities. O’Leary’s advice is straightforward: brew coffee at home, bring lunch to work, and invest the savings. He argues that these choices are not just about frugality but about prioritizing long-term financial security over immediate gratification.

O’Leary’s personal approach to money management is rooted in discipline and careful planning. He advises young people to track their income and expenses over a three-month period to gain a clear understanding of their financial health. He also warns against emotional spending, which can lead to poor financial decisions. O’Leary suggests practical tricks, such as freezing credit cards in a block of ice, to curb impulse buys.

Beyond personal spending, O’Leary’s financial advice extends to aspiring entrepreneurs. He stresses the importance of projecting confidence and clear communication. According to O’Leary, the ability to articulate an idea concisely and know one’s numbers is crucial for success. He believes that financial literacy and the ability to project oneself effectively are essential for entrepreneurs to thrive.

While O’Leary’s message is clear—ditch unnecessary expenses and invest early—critics argue that saving at the rate he recommends is challenging for many young Americans facing high rents, student debt, and stagnant wages. However, O’Leary insists that building wealth is more about habits than income. He emphasizes the importance of getting into the habit of saving from an early age, given that younger Americans cannot rely heavily on Social Security for retirement.

O’Leary’s bottom line is to be smart with spending and avoid letting emotional impulses lock individuals into long-term financial baggage. For Generation Z, this might mean skipping the $28 lunch today to retire with $800,000 tomorrow. His advice serves as a reminder of the long-term benefits of financial discipline and the importance of making smart investment choices early in life.