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Black Beauty

John Goodell

AFTER 20 YEARS, the U.S. military has withdrawn from Afghanistan. The news brought back memories of the year I spent deployed there—and a crucial financial lesson I learned. Perhaps that lesson resonates even more today given the past year’s pandemic and the role deferred gratification has lately played in many of our lives.

When you’re deployed to a combat zone, the government doesn’t tax your wages. Consequently, most soldiers can sock away a lot of money. From a financial point of view, being deployed is a lot like being stuck in your house during the pandemic—assuming you’re fortunate enough to remain employed. Your expenses drop precipitously, so you’re able to increase your savings rate sharply.

For my wife and me, saving is an important part of our family ethos. Our savings rate typically approaches 50% of our income. But here’s the thing: During the year I was deployed, we saved nothing—and I have zero regrets.

At that time, my wife was a medical student and first-year resident. While her income was negligible, we still had her rent and other bills to pay. With the remainder of my salary, I spent the entire year in Afghanistan saving for what most personal finance experts would consider one of the worst uses for money: buying a new car.

That year was one of my life’s bleakest periods. Four months into my deployment, I committed to purchasing a car through a program offered to deployed servicemembers. I paid a large chunk of my salary each month until the vehicle was totally paid off at the end of the deployment. In return, I received a small discount on a car that I was allowed to customize.

And it wasn’t just any new car. I bought a 2013 black Ford Mustang GT Premium California Special Edition. I spent months designing the color of the car, the color of the racing stripes and their location, and whether I wanted window louvers.

I longed for that car and thinking about it offered an incredible escape from reality. When I eventually got to feel the full power of the 442-horsepower V8 engine on a back road somewhere between Tennessee and Texas, the feeling was indescribable.

I paid roughly $36,000 for that depreciating asset, which would easily be worth more than triple that amount today had I invested it in an index fund. Looking back on my time in Afghanistan, simply having something to take my mind off the current situation was incalculably the best investment I could’ve made.

Writer Morgan Housel recently drove this point home when he discussed why the poorest Americans spend roughly $400 a year on lottery tickets, which is substantially more than other Americans. To most readers, spending money on impossibly long odds—instead of saving, investing and letting compounding work its magic—makes absolutely no sense. But in truth, the reason poorer Americans buy lottery tickets makes perfect sense: Those tickets offer hope for a better tomorrow and an escape from their current reality.

After the past 18 months, during which we’ve been denied many of the things we’d previously taken for granted, I hope we can all relate. Despite the Delta variant, the pandemic chapter of our lives appears to be drawing to a close, just as the Afghanistan War has finally ended. We now have the chance to enjoy all those things we’ve longed for—eating in restaurants, taking exotic vacations, visiting family members—the anticipation of which has sustained us through this grim period.

For me, a key takeaway from the pandemic and my experience in Afghanistan is this: Someone else’s return on investment from buying lottery tickets, a new car or an expensive vacation will be different from my return on that same investment. And that’s as it should be—because their reality is different from mine.

John Goodell is general counsel for the Texas Veterans Commission. He has spent much of his career advocating for military and veterans on tax, estate planning and retirement issues. His biggest passion is spending time with his wife and kids. Follow John on Twitter @HighGroundPlan and check out his earlier articles.

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