With Joe Biden dropping out of the race for President of the US, the attention of the world has turned to the presumptive nominee, Vice President Kamala Harris. As a federal worker, she discloses her income and assets in forms filed with the Office of Government Ethics. The amounts given are in wide ranges, so we don’t know the exact amounts involved. What is interesting is how Harris and her husband, Douglas Emhoff, have accumulated their wealth.
Both Harris and Emhoff invest in a range of index funds. All the index funds are well diversified across a number of different sectors. They didn’t disclose investing in any individual share or sector specific funds. Of course, being in the position that she is in, she does not want to give off the impression that she has inside knowledge of any particular industry or company (take note Nancy Pelosi 😉).
A lot of their wealth has been accumulated in pensions. Building wealth is a long term game with most people not becoming wealthy until late in life. Pensions fit in perfectly with that strategy, long term investments in a tax efficient manner. Getting as much money as you can into your pension as you can will provide you with lots of options in the future regarding reducing your working life or stopping altogether.
Harris has debt on her home but availed of rates when they were lower, locking in at 2.65%. Rates are a lot higher in the US, where borrowers lock in for the long term. A 30 year fixed term rate in the US is currently around 7%, so locking in at 2.65% is a very cheap rate. People don’t lock in for as long in Ireland but it is always a good idea to avail of good rates when they are available, especially if you do not intend on putting on clearing your mortgage during that period.
Harris and Emhoff are multimillionaires because of their ability to save large amounts. Their earnings in 2023 was $450,000, which is well down on what it was before, when Emhoff earned $1.2m from his position as a partner in a law firm. But their investment strategy is very simple and uncomplicated. And it works. Compare that to multi layered, debt ridden, conflicted strategy of her opponent…
Steven Barrett
29 July 2024