Wednesday, September 7, 2011

Are Diamonds Broke Like Everyone Else?

I recently read an article on what constitutes wealth. Some say an annual income of $100,000 would make them wealthy, some say assets exceeding $4 million would do it, and some estimated that $2 million would make them "rich". Of course, everything is relative and someone earning $25,000 a year would think that $100,000 a year is wealth, etc. College students might think $40,000 a year is awesome because many have little money to begin with. I'm sure someone like Bill Gates would not consider $4 million to be astonishing. It's all relative. If you are content with what you have, you are likely relatively well off already.

But let's talk about Amway diamonds. I say diamond because it is basically the pinnacle of success. It is the crowning achievement of the 6-4-2 plan (or other variations) that many groups show. The average diamond earns about $150,000, according to Amway. Now $150,000 sounds like a lot of money to young people or to those with lower wage types of jobs, or those who are just starting out in their careers. But we also know that diamonds earn income from the sale of tools. Some groups advertise (verbally) that someone might earn $100,000 a year from the tools/speaking income.

Let's be generous and say the diamond earns $300,000 a year from Amway and tools income. Income tax and medical insurance for the family will eat up about 40% of that right off the top, leaving about $180,000. Fantastic you might say? Well, a diamond certainly would live in a million dollar mansion, which would give you about a $6000 a month mortgage or $72,000 a year, leaving $108,000. (Although many - a - diamond pays for their homes in cash) Fantastic right? Well, diamonds are constantly traveling to various functions, flying first class and staying only at 5 star hotels right? So an average of 1 trip per month with a family, first class and a 5 star hotel would probably cost about $5000 or more per trip, or about $60,000 a year, now leaving $68,000 for this diamond's yearly budget. A good diamond with a family surely consumes 300 PV per month for household goods, or about $900 a month or about $11,000 a year, leaving $57,000 for the rest of the year. A good diamond is often a Christian who would faithfully tithe 10% of his income, or about $30,000 a year, leaving the diamond with $27,000 a year, or about $2250 a month to pay for their monthly electric and utility bills, gas, car payments, meals and entertainment.

Yes, some expenses may be slightly higher or lower, but what I am trying to illustrate is that even an above average diamond with tools income is more likely to be broke than wealthy if they live the lifestyles portrayed at functions such as dream night or other major functions. Do the math. It is unlikely that diamonds pay cash for everything and it is unlikely that fabulous lifestyles can be sustained on a diamond income. There is plenty of evidence out there. Diamond's homes foreclosed, diamonds behind on income taxes, a prominent triple diamond in bankruptcy proceeding, many diamonds selling off their homes in a bad real estate market.

I truly believe that it is quite possible for many diamonds to be broke. What do you think?


Anonymous said...

Joe, I think it is reality. I have a PACER account (a trade privilege), and I researched the G. Duncan bankruptcy filing a couple months ago (oh, that you could see some of the filings and pleadings). THAT guy is definitely "broke" (or in bankruptcy terms, "insolvent"). Just representive of all the circumstantial evidence that the "Diamond lifestyle" promulgated by WWDB et al is a sad lie.


Anonymous said...

does the name "greg duncan" ring any bells? HMMMM????? ;)

Joecool said...

Hi Daniel,

Thanks for the comment. I've done posts in the past illustrating that a diamond income, while decent, cannot possibly sustain the trappings that many diamonds show off. In most cases, diamond wives do not have jobs, thus the Amway and tool income is all they have in many cases. After taxes and business expenses, diamonds likely live a very middle class lifestyle outside the their Amway personnas.

Joecool said...

BTW Daniel, is the Greg Duncan case closed or are there still activities going on in that case?

Anonymous said...

Oh, it is still going full bore, at least last time I peeked at it - Chapter 7 is "liquidation" bankruptcy, and the liquidation aspect of it won't be done for a long time, I expect. The Trustee seems to be trying to figure out the extent of non-exempt, non-liened assets to sell and make money for creditors, and the Duncans seem to be trying to salvage essential items like Hummers and other toys that they use to dazzle IBOs with the enviable lifestyle and trappings of their astonishing, inspiring life of integrity and "no regrets."

Joecool said...

If it's publicly available information, I could write a blog post about it if you want to send me the information? I would have thought the liquidation would have been done by now. Interesting. I know the Duncan's listed millions in assets but I think some of those assets were the homes that were foreclosed and most of the rest were estimated assets from Sarshela and his other businesses.