09/29/2015 01:36 pm ET Updated Dec 06, 2017

The Value of Vanity

"JAZN4U" on a Toyota. "IV LIFE" on a Volvo. "NUGGET" on a gold Mini Cooper. As a financial advisor, I spend a lot of time commuting to client meetings and noticing vanity license plates while yoked to my car seat during traffic. In New York City I never noticed them (probably because the initial cost for a personalized plate is $60) but with the multitudes of custom plates in Oahu you'd be hard pressed to ignore a Golden Nugget.

The initial cost of a vanity plate in Hawaii is $25, plus $25 added to your registration fee every year. The Honolulu Department of Motor Vehicles doesn't keep a record of how many drivers have these chattels, but they are a huge source of revenue for state licensing agencies. Twenty-five dollars a year won't drain someone's bank account, but there's certainly an opportunity risk here. Money spent on personalized plates could be invested and earmarked for retirement.

If 16 year olds invested that money every year in a retirement account, by the time they are 59.5 years old (the age the government allows people to access their individual retirement money without penalty) they could have accumulated $17,947.62 in earnings. There is a trade-off between paying attention to your retirement plans and getting attention for your car: the value of the license plate isn't in the $25 spent every year but in the thousands of dollars this recurring, discretionary expenditure costs in forgone earnings compounded over many years.

Knowing this, it's hard not to see the irony in these clever plates:


Here are some other funny ways that people are personalizing their cars: