Happy New Year everyone! Glad to finally be able to close the calendar on 2020 and start afresh in the new year with all that pandemic and election
nonsense relegated to the history books. Oh wait. Don’t worry, this is not an article about how our Gregorian calendar is an ultimately arbitrary
delineator of the flow of time...though we do often like to point that out, seeing as how the entire financial industry is obsessed with reporting returns
from Jan 1 - Dec 31.
Rather, this article is about the enormous waste of money that is politics. As of early December, about $330M has already been spent on ads for the
two Senate runoff elections alone, as I’m sure you might have guessed by how many you’ve seen on TV. Analysts expect that number could be more
like $500M by the time you’re actually reading this. Which begs the question - what else could you do with $500M?
For context, most endowments adhere to a 5% rule - you should be able to spend 5% of your money and have it last forever (Note: this assumes the
entirety of the assets are invested in such a way as to return 5% plus inflation and therefore does not apply to the money in your checking account). 5%
of $500M is $25M. Let’s say your average small-town public servant makes $40,000 a year (think librarians, teachers, police/fire/EMT, social services).
$500M would be able to fund the annual salaries of 625 such people in perpetuity. Not for a year or two. Forever.
Imagine the benefits to local communities and the impact that 625 teachers, librarians, social workers and safety officers could have year after year
after year. You want to actually make this country better? That’s a good place to start.
I like to point the finger especially at Michael Bloomberg. He wasted $115M (143 public servant positions) on pro-Biden ads in Ohio, Florida,
and Texas (all states that Trump won). If you throw in local elections and his own brief, doomed-from-the-start-despite-buying-his-way-into-thedemocratic
debates candidacy, Bloomberg blew nearly $1B (or 1,250 public servant positions). On the Republican side, Tom Steyer spent $250M (318
public servant positions).
In total, about $14B was spent on the 2020 elections. That’s 17,500 public servant salaries. Forever. And we’ll do it again in four years. What an
absolute waste.
Now, to bring this back around to personal finance. You don’t make a meaningful difference in the above numbers by having Bloomberg only spend
$750M instead of $1B. Similarly, you don’t make a big difference in your financial picture by cutting out Starbucks once a week. Something to think
about over this coming year - your financial picture is much more influenced by infrequent, large purchases rather than small, everyday purchases.
Like taking on an extra $100k in mortgage debt when buying a house. Like leasing a brand new car versus buying an older one.
That’s categorically not to say that you shouldn’t have nice things. But if one of your goals this year is to build a better financial situation, pay close
attention to the big-ticket items that come up, and don’t feel like you have to deprive yourselves of life’s little joys (for me personally, Starbucks would
never, ever - in perpetuity - make that list. But hey, to each their own). And if you want a little help with that goal, I’m always happy to chat. russ@
atiwealthpartners.com.
12 TYBEE BEACHCOMBER | JAN 2021
Rogue Waves By Russell Robertson, CFP
A LITTLE PERSPECTIVE
/atiwealthpartners.com