For the past 15 years or so, I’ve been playing badminton at one of the two private athletics clubs here in the city.i At first, we had a family membership so that my parents had somewhere to work out and, more importantly, a place for me to spend time after school.ii Within a few years, however, the rest of my family was hardly using the club and it became clear that I was the only one who was seeing a return on our investment. When I turned 18 and became eligible, my family dropped their membership and I took sole proprietorship of our share. For the last number of years, I’ve alternated between active and social membership, depending on school load, work commitments, and confidence that I’d be staying in the city. Now, married and reasonably planted as I am, I’m back in full badminton form as an active member.
I must be having a good time with it because my wife recently expressed interest in becoming a member as well. All too happy to have her join me, I contacted the member services staff to inquire about the cost of this status change, from which I received the following quote:
Active Couple: 18 – 29 years dues:
$2,701 + GST annual OR
$253 + GST x 12 months = $3,036 + GST Savings of $335
Capital Levy Fee:
$500 + GST annual OR monthly = no savings here as we just take the $500 and divide it by 12 months
Aside from the “savings” actually working out to $351.75,iii and including the Capital Levy Fee,iv paying annually works out to $3,361.05 vs. $3,712.80 for the monthly instalment plan, or a difference of 10.47%. This difference indicates that the member paying monthly feels they can get a better ROI than 10.47%.v Considering that the average (fiat) investment return is something like 5% before you factor in the bitch slap that is inflation, paying monthly is a bold play.
Still, I think that Bitcoin can do better. A lot better. In fact, I’m betting that I can get my membership for free in fiat terms. Not just cheaper. FREE.vi
The plan is simple:
1) Invest $3,712.80 in Bitcoin on June 19, 2014.
2) Sell $309.40 worth of Bitcoin on the 19th of every month to cover membership dues.
3) See if >$3,712.80 in Bitcoin remains on June 19, 2015.
4) Wash, rinse, repeat.
The 30-day CAD/BTC average from CaVirtex, according to bitcoincharts.com, will be used to determine the purchasing and selling prices. The first month’s dues will be paid today, net of the initial sum of 5.9319779 BTC. At the end of the year, we’ll see if our membership was gratis, and if not, how much it cost us.
If the wager is successful, it will be renewed, potentially yielding an indefinitely free athletics club membership.vii
Let the games begin!
—–BEGIN PGP SIGNED MESSAGE—–
Month 1: (19-06-14)
Starting balance: 5.93107779 BTC
Ending balance: 5.47640723
BTC 30-day CAD/BTC average: $625.990778
Monthly Dues: $309.40
—–BEGIN PGP SIGNATURE—–
Comment: GPGTools – http://gpgtools.org iQEcBAEBCgAGBQJTom8HAAoJEM7/K1z0jN1Ffp0H+QFaqO7bGpJwmgv5gOOhBffCx9PPLOhJPu0pigycsYtvA8OEVXsCZVz1CIe+cJKkzjKTTIsDptDtm8HxQUogsTg78Fn9ItQfPvmvMy4RAf8h6iETRv/641siLZ40LzVSqk9n5DcLT8RL4b5613GNZgIURQH1YdNKWA0O3W6a7EE5+Tq2nGspephW9HpoJloFb0uWLGYzco52uMmTgvsiLjFXivb2tMsrggME0yeQbPNtbx1Iw1o0jUp6FKwDXK8QV+w1GGicIarkU/1rh2kZEv7jh+nD9e9OxVUJebZ4hbBXPEgYrZtJbyrsM3UVCDGZQDrzyqFlhTAZADRlsfwJvfU==Koh7
—–END PGP SIGNATURE—–
___ ___ ___
- Between the two, it’s debatable whether Edmonton’s Royal Glenora Club, where I’m a member, is an overall superior club to the Derrick Club, its cross-town competitor. The Derrick has an full 18-hole golf course right next to their athletics facility, which is tempting given that I grew up playing golf alongside badminton and was a scratch golfer up until a few years ago. Still, badminton is the better year-round sport and the Derrick’s badminton facilities aren’t as strong and the players there commensurately so. The better badminton players in the city, of which I include myself, have always been attracted to the RGC, which has therefore produced more than its fair share of national champions in the past two decades. Since the RGC is located centrally, where I also happen to live, and the Derrick is 10 km away in the south side of the city, the geography makes it an even more obvious choice for me. Still, I debate with myself from time to time… [↩]
- My brother was more into team sports like basketball and soccer, which are far from the focus of racquet-centric private clubs. I didn’t care to bank my success on the questionable abilities of others and found more satisfaction, and better results, in the more fringe sports offered by private clubs, eg. golf and badminton. [↩]
- Once the tax savings are included. [↩]
- This is another one of those “temporary” taxes not unlike the income tax imposed in Canada… in 1917. [↩]
- Or that, between their Mercedes lease and their 30-year mortgage, they can’t stretch their $150k+ professional salary far enough to cover the lump sum. It really is incredible how many 6-figure income earners live paycheque to paycheque. They’d do well to read MP’s How to live to be rich, calculate their net worth, and draft a yearly budget from which they may not depart. As I have. [↩]
- This bet is in the spirit of MP’s famous 1000 BTC Berkshire bet. But whereas he actually has something at stake, this bet is more of a Gedankenexperiment, if an interesting one. I really have nothing to lose and everything to gain in setting a precedent. So many of us are presented with annual vs. monthly payment options for everything from insurances to mortgages to association dues. If you’ve ever chosen the annual option, this experiment is worth following. [↩]
- In fiat terms. [↩]