Five things that cost way more than you ever imagined

Finance Tips

Everything has a price. But some things have a much higher price than others. This is especially true when it comes to lavish and extravagant purchases by the wealthy, or billion dollar spending by governments to support their local economy. Yet, while these expensive ventures have their benefits, they also come with major consequences and hidden costs. Leaving many to wonder if they are worth it in the end.

Things that cost way more

Political Campaigns

Political candidates have been known to jet-set around their local country in an attempt to win over voters. They have also been known to advertise on television and in print in order to boost their own stock, or degrade their competition. These tactics come with a price tag, and it isn’t cheap.

It is estimated that the 2016 US presidential and congressional election cost a total of $6.5 billion. Although spending more money doesn’t guarantee victory, as President Donald Trump’s campaign spent $398 million, which doesn’t come close to matching the $768 million shelled out by the campaign of his competitor Hillary Clinton. These statistics have led as much as 70% of Americans to feel that election spending should be limited.

Meanwhile, in France, money also rules the political sphere. It has been proven in the country that there is a direct correlation with total spending on a campaign and the total votes the candidate receives. For instance, when former Prime Minister Alain Juppé was running for mayor of Bordeaux, he spent €168,000 on his campaign and received another €222,000 in private donations, propelling him to victory over his opponent.

They say money can’t buy everything. But that won’t stop political candidates from trying to buy their way to more votes. Is US President Donald Trump just an anomaly when it comes to campaign spending, or are there other ways candidates can win an election without spending exorbitant sums of money?

The Olympics

Nations competing on the global stage in sporting events has been commonplace since the first Olympic games in 1896. Each year, nations vie to host the winter or summer games, hoping to bring millions of people, and dollars, into their country.

The Olympics

The case for hosting the Olympics is sound. In order to host, a country will need to build infrastructure to support the games, which in turn will create jobs for the unemployed. When it comes time for the games, millions of people will flock to the country, pumping billions of dollars into local businesses like hotels, restaurants, and transportation. This influx of people makes it easy to justify improving public infrastructure and facilities.

However, the case against hosting the games is equally as compelling. The Olympics in Brazil proved to be a warning sign for other poor countries as to how this venture can go terribly wrong. Leading up to the games in Brazil there were numerous problems: water and air quality were not up to par, athletes reported being robbed, and concerns over outbreaks of the Zika virus.

South Korea forked over $109 million just to build a new stadium in order to host the 2018 Winter Olympics. What’s even worse? The country demolished the stadium following the games after it was used only four times! All told, the country spent $13 billion on the games, leaving many to wonder if all the spending was worth it.

Hollywood Movie Production

To produce a movie takes not only a significant amount of resources, but people as well. While actors are the only ones to show their face on the big screen, there is an army of other people involved in movie production behind the scenes. Writers to compile a script, directors to shoot the film, assistants for all of the actors, and even assistants to the writers and directors. Not to mention producers, sound engineers, film editors, and much more.

All told, box office revenues could hit $50 billion by 2020. So maybe we shouldn’t be surprised it costs so much to produce films that people will want to see. Generally, movie production can’t begin without a massive amount of capital backing the project. This capital can come from major studios or production houses, or alternatively, wealthy investors who believe in the project.

It turns out the average cost of producing a Hollywood movie is somewhere around $139 million, but blockbusters can run significantly higher. The Pirates of the Caribbean franchise had multiple films exceed $350 million in production, while Titanic and Justice League both exceeded $300 million in cost.

Many cities and states work to bring film production into their area as it creates big benefits for the local economy. It is estimated that a film crew can spend upwards of $50,000 per day at local businesses like gas stations, restaurants, and dry cleaners.

Currently, the United Kingdom is a great place for Hollywood movie production. That’s because the country is offering a 25% tax credit toward film production, which has brought an influx of US production across the pond. To counter this move, the birthplace of film, California, recently extended its tax credits, totaling $330 million per year, to the film industry through 2025.

Superyacht

If there is one image synonymous with wealth, it is a yacht. While some yachts on the small side can cost less than $100,000, it’s the superyacht which will run you well into the hundreds of millions.

Superyacht

Take your pick of lavish water palaces. There’s United Arab Emirates royalty Khalifa bin Zayed Al Nahyan’s Azzam, who’s superyacht measures 180 meters (590 feet) and comes with a $600 million price tag.

As a standard rule, yachts which measure over 30 meters (100 feet) will cost about $1 million per extra 1 meter (3 feet) in price. Generally, yachts over 100 feet cost $1 million per 3.3 feet — and that’s not counting costs for upkeep.

But owning a yacht isn’t just as expensive as the cost of the boat itself. There are a slew of other expenses that come along with such a luxury item. Generally, the biggest expenses that come with a yacht are paying for a crew, dockage, fuel, and ongoing maintenance. These costs alone can run in the millions of dollars.

Don’t worry; you can always use a yacht calculator to determine if you can afford this high-priced luxury items.

Private Island

While a private island might sound outlandish, it is possibly the cheapest item on our list. That’s because islands come in all shapes and sizes, and also come with a wide range of price tags.

Private Island

There are even a variety of islands for sale right now across Europe, ranging anywhere from €150,000 to €5,500,000 in price. Just make sure you know what you are buying, as some islands on the cheaper side won’t get you very far.

If you are going to buy an island, there are a few things to consider. First, it’s important that the island is close to the mainland, or else it will be difficult to get supplies and provisions as needed. You will also want to check on the services available on the island. Many islands don’t come with basic services such as electricity, and must operate off generators for power. Lastly, contact the local authorities to get information about building permits. The last thing you want is to purchase an island and not be able to build your dream vacation home!

Lastly, you should be very careful that no one else has laid claim to your piece of land. According to Chris Krolow, CEO of a company which sells islands, this isn’t as far-fetched as you might think. “Every once in a while, there may be someone contesting a deed on the basis of squatter rights. It’s happened in the past in Central America, and that’s caused the deal to fall through,” Krolow notes.

Think Big

If you have obtained more wealth than you know what to do with, don’t worry, there are always new ways to spend it. This can range from donating big bucks to a political campaign, to buying your own superyacht or private island. Meanwhile, governments themselves are prepared to spend big money supporting the Olympic games and giving out tax breaks to Hollywood films in order to spur local economies. No matter how you slice it, there is so much money in the world being spent on these things that it is almost hard to comprehend.