Whiz Kids

Every so often TLC is fortunate enough take in a client – a whiz kid really - with a lot of financial expertise.

And another one showed up the other day. After a week or so on the property he did the math and figured out that TLC was “getting rich.”

What he did was take the calculator on his cell phone and multiply the $110 a week that clients are supposed to pay times the 80 residents at the Macdonald House.  And bingo, he came up with a figure of $8,800 a week! Or nearly $40,000 a month!  

Then, of course, he then extended the numbers out to include the entire program and got really excited. 110 times 600 clients is a nice number all right. Impressive figures. But they’re not real.

First of all, TLC never collects 100% of the service fees charged. The real number is more like 62%.  And this number wouldn’t be bad either.  But that’s not net – that’s gross income.  (For the challenged gross means the total amount coming in.)

One thing our whiz kid didn’t consider is expenses. For example, June through October electric bills run at $55,000 to $65,000 a month.  This month’s electric bill for the City of Mesa alone: around $20,000.  TLC utilities run nearly $700,000 a year.  Mortgages and leases run about $900,000 a year.

Other things to consider: vehicle insurance at $4,000 a month. Gasoline: around $12,000 a month. Liability insurance $7,000 a month.  Food: $13,000 a month.  The list goes on and on.

My feedback -  when I hear about clients with this kind of financial expertise - is to invite them to our accounting office. We need all the help we can get.