Quote to Ponder
"Everything has a price, but not all prices appear on labels."
Recommended Links
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- Lessons From Being Wrong - Ben Carlson, X post
- Teenager Texts - Shawnee Gregorio, X Post
- The Divergence: Bond vs Stocks - Josh Wolfe, Article on X
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A Yale Professor’s Investment Formula Says You Need More Stocks. - The Wall Street Journal
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Diversification: It’s Not Just for Defense Anymore - The Wall Street Journal
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What Does a Thief Need to Access Your Financial Accounts? It’s Likely Less Than You Think - Oblivious Investor
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Contrasting Viewpoints
- The 2028 Global Intelligence Crisis - Citrini Research
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The 2028 Global Intelligence Boom - In The Trenches by Michael Bloch
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Recent Content From Quarry Hill
If you’ve been following along on social, you may have seen some of our new videos and resources. Here are a couple of our recent favorites:
A note from Bjorn Amundson, CFP®
Early in my career, I worked for one of the big brokerage firms here in the Twin Cities. About 2,000 advisors under one roof. And every few weeks, the technology would go down.
Not slow down. Go down.
You'd lose your contact management system. You couldn't see client accounts. You couldn't place trades or pull up a financial plan. Thousands of employees, sitting at their desks, suddenly unable to do anything, for hours.
It happened like clockwork, roughly once a month, and nobody could figure out why.
So I started asking around. One of the tech people eventually explained it to me, and I've never forgotten the lesson.
Every so often, management would look at the technology department and see a big number on the budget. So they'd lay everyone off and make them reapply for their own jobs. They'd hire back the people they considered top performers and let the rest go.
On paper, it looked smart: Trim the fat, keep the best, and save money.
But somewhere in that department used to be a guy making $50,000 a year. He wasn’t flashy or writing new code or leading projects. He didn’t seem to serve much of a purpose at all, so he would end up getting laid off.
But it would turn out he did serve a purpose. He had served as an instiutional memory bank. It would turn out that although he didn’t do much on a day to day basis, he was the only one who now knew that back in 1987, someone had patched together a fix in the company's software. It was buried deep in the system and nobody documented it. And if you messed with that patch, everything would go down.
During one of these scheduled budget cuts, he was let go. They lost that knowledge.
Shortly after, the monthly outages started. Someone would eventually do something that interfered with that ancient patch, and every interconnected system in the building would crash.
Two thousand advisors. A few hours of lost productivity. Client calls unanswered. Trades unplaced. The cost was enormous, orders of magnitude more than $50,000.
Management never saw that cost. They saw a line item on the budget: $50,000 for a guy who didn't seem to do much. The millions of dollars his quiet, invisible knowledge was protecting never showed up on any spreadsheet.
They pursued the last dollar of savings and broke the whole system.
I wish I could say I only recognize this mistake in other people. But I've made the exact same error in my own life.
A few years back, Leah and I decided to renovate our house. We needed new siding boards, and the smart move would've been to buy enough full-length boards and the right tools to do it properly. But we looked at the price and thought we could save a couple hundred dollars by making do, buying fewer boards, splicing pieces together, using whatever tools we already had.
So there we were. Ninety-degree heat. Trying to cut and splice boards on the side of the house with tools that weren't designed for the job. Every cut took three times longer than it should have. The joints didn't line up. We were sunburned, frustrated, and arguing about technique.
We saved maybe $200 in materials. We cost ourselves an entire weekend and did a worse job than if we'd just spent the money in the first place.
The $200 was visible. The wasted time, the frustration, the inferior result…those were invisible. And like always, we optimized for what we could see.
I think most of us do some version of this. We see a cost on the statement and instinctively try to eliminate it. The gym membership. The subscription. The CPA who charges $200 too much. The number is right there, staring at you, and it's human nature to want to make it go away.
But the costs you don't see are almost always larger.
Another example is that it’s hard for some people to hire a financial advisor, because they see the cost. But what they don’t see is the taxes they could have been saved. They don’t see how much higher their portfolio would be if they actually rebalanced it when they should. They don’t see the memories they could have made if someone had told them they had enough to go on vacation more often.
Those costs don't show up on a line item. They don't send you a bill. But over a lifetime, they dwarf the visible cost of getting help.
So here's my challenge for you this month: think about the last time you pursued that last dollar of savings a little too hard. The time you tried to do it yourself and it cost you more in the end. The time you cut something that looked unnecessary, only to discover what it was quietly holding together.
Sometimes the most expensive thing you can do is save money.
This material is intended for educational purposes only. You should always consult a financial, tax, or legal professional familiar with your unique circumstances before making any financial decisions. Nothing contained in the material constitutes a recommendation for purchase or sale of any security, investment advisory services or tax advice. The information and opinions expressed in the linked articles are from third parties, and while they are deemed reliable, we cannot guarantee their accuracy.
