Tag Archives: math

The New, and Not Improved, Starbucks Rewards

My Starbucks Rewards operates on a fairly simple premise: go to the store and buy things 12 times, and earn a freebie (coffee, food, pastries, etc.).  The programme has changed a bit through the years – you used to be able to get free syrups in your drinks if you were a Gold member, but only got a freebie every 15 visits – but it’s always been about frequency of visits, not how much you spend.

Now that is changing.  The new Starbucks Rewards, according to an email sent out today, works as follows:

You’ll earn 2 Stars for every $1 you spend on coffee, food, drinks, mugs–and more. As a Gold member, once you earn 125 Stars, you’ll be able to redeem them for anything on the menu.*

Doing some quick math, you earn a free reward for every $62.50 spent at Starbucks.  Over 12 visits, that would average out to $5.21 per visit – which is far more than the average “handcrafted espresso beverage,” and, actually, more than almost any item on the menu excepting food items.

What does this mean for you?  If you typically go to Starbucks and order multiple items, you will earn freebies a bit faster.  For everyone else, it will take about 18 tall cappuccinos or mochas to earn a reward.

While this is being billed as a bonus for those who buy coffees for the whole office and now get extra stars for it, most customers will spend a lot more money to get the same rewards.

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“Average debt load” is a lagging indicator

A friendly reminder from your math nerd blogger: “average debt load” of graduating students is almost always going to be substantially less than a new student will owe.  This is due to increases in tuition and fees that exceed inflation.

Using law school as an example, because I was just snarked down to about that, the most recent data available is from the Class of 2013.  (The Class of 2104 hasn’t graduated yet.) Those students were enrolled in law school from 2010 to 2013.  Law school tuition has increased by $4,000 – $5,000 per year.

Therefore, a student who is enrolled from 2010-2013 will be charged approximately $50,000 less than a student who is enrolled from 2014-2017.  As cost increases a few thousand dollars per year, the latter student will pay about $18,000 less for her first year than the former student did (2010 -> 2014 is four years * $4k or $5k/year); the same repeats for her second and third years of law school.

This is also why student loan debt continues to skyrocket; everyone is using data that is outdated, even if it’s the most recent data available.

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Filed under Academia, Economics, Law