August 15, 2014 — Howard R. Gold wrote a piece a while back, published in the USA TODAY newspaper, titled “Price tag for the American Dream: $130,000 – What It Costs to Live the American Dream”. As usual, there were varying comments from TV pundits, bloggers, etc. about the author’s assertions but I read the full article and find that some of those talking-heads are missing the point in the same manner some timeshare developers are when it comes to minimal incomes necessary to purchase a timeshare interest.
So Here’s The Scoop: To begin with, the point of the USA Today article, at least the way I read it, was that families need about $130-K to live the ‘dream’ and sadly, in the United States the vast majority of Americans earn far less — hence, the ‘dream’ is either not reachable or not quite what they thought it would be and that is especially true for those families with incomes at or less than ½ of the $130-K ‘Dream’.
What I find interesting in our industry is that there are few developers who have an income requirement for their sales guests that exceeds half of that $130-K ($65-K) milestone. Even more astounding is there are still developers with sales guest income requirements as low as $40,000 (gross) and I’m told, though I haven’t been able to verify it yet, that there are some developers who have no income requirement at all.
And as a matter of record, in the United States an annual gross income of $130-K in 2014 is equal to an annual gross income of approximately $45-K back in 1980 and as best as I can recall, when I started my timeshare journey back then I was working for a developer whose sales guests needed a $25-K yearly (gross) ‘pop’ to be deemed qualified.
Having a qualification income of $25-K in 1980 means that today the same income qualification should be around $72,000; yet there are developers in ‘the biz’ who still insist – in 2014 – that an annual gross income of only $40-K for a family (any size) is deemed a ‘Q’ – a ‘hot-prospect’, a ‘Gold-Ball-Up’!
Maybe they think that way because some of those developers and their executive ‘deciders’ have never sold a week in their lives. Or, like millions of otherwise fine hard-working folks who often wind up in our sales centers these ‘deciders’ are clueless when it comes to understanding some basic financial topics and principles like “disposable personal income”.
So to aid the cause and help those developers make more sales, allow me (with the use of online sources) to help these particular ‘deciders’ out a little bit. Now don’t thank me gang; it’s just the kind of warm-hearted Scoop that I am!
“Disposable Personal Income” – That means, as an example, the amount of money a person (or family) has left over from each paycheck after their taxes are deducted, and that amount will then determine their “cost of living”.
“Cost Of Living” – After all State, Federal and other tax obligations are deducted from those paychecks – this means what is left over is how much money a person or family has to maintain their particular “lifestyle”.
“Lifestyle” – As it relates to each person’s “cost of living” this simply means how much the family can spend on rent or a mortgage including property taxes each month/year as well as for groceries, utilities, new or used and type of car, car payments, gasoline, repairs, insurance such as life and short/long term healthcare policies, burial insurance, etc. And of course clothes for the entire family, maybe taking in a movie now and then or a family night out with the kids at the bowling alley and sharing a pizza.
“Savings Account” – Now the idea here is to take a few dollars each payday, after their “Disposable Personal Income” and after their “Cost Of Living” and their “lifestyle” expenses, and place that money aside in a savings account for that rainy-day and maybe even towards their retirement.
“Mad Money” – This is an expression that apparently started just before the first Great Depression of 1929. Back then a woman going out on a date had enough money tucked away in her purse to leave and take a taxi home (alone) just in case things weren’t going too well for her.
Today, and in larger quantities, “Mad Money” is also known by many including some ‘in the biz’ as “F _ _K You Money” – and that pretty much means what it suggests.
That’s right: Long before those never ending “cost of living” and “lifestyle” realities have to be met, and excluding any “savings” or “mad money”, etc., a family (any size) with a weekly “disposable personal income” of about $540 — these $40,000 (gross) annual income sales guests — can’t frickin’ afford to be happy little timeshare campers no matter how much they may like or want it!
Good luck out there!
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Contributing sometimes extravagant, bombastic, emotional, pompous or even pretentious writings about the timeshare industry, Scoop covers an array of industry related subjects each week including inside information, tips, scandals, interviews, forecasts as well as new (good or bad) products and services — and, of course, all the ‘Good’, the ‘Bad’ and the ‘Ugly’.
Stay tuned for what is sure to be a fun ride and check back to Timeshare Scoop du Jour each week for more of the inside scoop.