smart spending

Santa's net worth

Highlights
  • Santa would bank $2,903,958.50 at the federal minimum wage of $7.25.
  • The Muppets are actually richer than Santa.
  • Over the five-week holiday frenzy, Santa must budget $34,510,000 in payroll needs.

Every year about this time, children and accountants study Santa Claus and ask: How does he do it?

The kids, of course, wonder how their red-suited benefactor gets down all those chimneys in just one night. But the accountants have another question: Exactly how does the Santa business model work?

Sure, the old guy picks up a handsome paycheck for all those shopping mall hours he puts in. And he has a few other sources of income. But then he gives away all those presents. As any parent can tell you, that's not cheap.

So Bankrate.com, always fiscally responsible, decided to take a look at Santa's balance sheet and see how this all works out financially.

Income

Since the 1950s, Santa Claus has found gainful employment at shopping malls across the United States, grinning for the cameras while hugging everything from screaming tots to drooling dogs. But the photography companies pocket the profit from those pricey picture packages -- Santa is actually an hourly employee at the approximately 1,000 enclosed malls in this country.

According to the International Council of Shopping Centers, Santa reported for work at a majority of these locations in 2008 on Nov. 14, which gave him 40 days of employment. Because 97.1 percent of the malls extend their shopping hours during December, it's a safe bet he's on duty 10 hours per day, even with two meal breaks, for a time card of 400,000 hours. Then, of course, he has his traditional haunts: Macy's on 34th Street in New York and rival Bloomingdale's uptown. Not to be outdone, South Street Seaport has also jumped into the fray demanding his presence, so add another 546 hours.

That means Santa would bank $2,903,958.50 at the federal minimum wage of $7.25. However, a few years ago, this savvy dude capitalized on years of experience (not to mention a real beard) and negotiated an average salary of $10,000 a year with the photography vendors, so in reality he's bringing home $10,000,000.

And because Christmas boils down to seasonal work, he has begun appearing at award nights, conventions, birthday parties and casinos throughout the year, commanding hefty fees between $1,200 and $10,000 per job. A couple of these gigs a month would pull in roughly $224,000 in extra cash throughout the year.

Unfortunately, he's missing out on the real cash cow. According to Steve Weinberg, a shareholder with the Greenberg Traurig law firm, the holiday icon has no claim to any royalty income. For starters, his history is a bit too murky for a lawyer to establish intellectual property rights to the roly-poly, eye-twinkling, gift-giving image. Over the centuries, Santa's identity has merged with those of Nicholas the Gift Giver -- St. Nicholas, sans the red costume in Washington Irving's tales -- and Kris Kringle.

Haddon Sundblom created the current character known as Santa Claus as an advertising campaign for Coca-Cola in the 1930s, so the soft drink company actually has a stronger case to get the money than Mr. Claus himself.

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"And assuming we could make the case he owns his reputation, he's really given it up to the public domain," Weinberg says. "In IP (intellectual property) law, if you don't exercise control over other people's uses of your reputation, you end up essentially abandoning your right to claim royalties." Santa's failure to send cease-and-desist letters to Tim Allen for portraying him in the movies was the final mistake.

Bottom line: Santa earns a little more than $13 million annually. Weinberg's former clients, the Muppets, are actually richer than Santa.

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