Dear #MoneyChat- Should I Buy A Timeshare?

Should I Buy A Timeshare-
Hey #MoneyChatters! Have you ever thought of buying a timeshare? This question was posted in the #MoneyChat Group, and I thought it would be a great article! Here are our answers to whether or not you should buy a timeshare.

Question: Should I Buy A Timeshare?

“A family friend was going on and on about timeshares yesterday. I heard a lot of horror stories about them years ago, but many people seem to love them now. What are your thoughts?” – Marq

Real Experiences:

My sister and her husband gifted us a stay at their timeshare for our honeymoon, and we only had pay for our flights to Aruba. It was wonderful. We met a lot of people who have had timeshares for 10+ years and loved it. However, these people go on SEVERAL vacations per year, and many of them (like my sister) come to Aruba at least 1x per year, some 2 -3x. These people take full advantage of the money they spend on the timeshare. You have to be careful with timeshares, and you have to book within a certain window. Timeshares are also hard to sell if your life changes. You could always buy a ‘used’ timeshare,  and if you do something like this and pay it off quickly, it could be beneficial.”- Dorethia

When we got ours several years back everything was okay and we were able to buy a timeshare at a really low monthly payment. You go on the tour and they show you the numbers at first it’s outrageous.  When you say “No way, can’t afford it” and are about to leave, the price magically drops hundreds of dollars. We managed to pay fees for a while and we vacationed with no problem. Then, of course, life changes happened and I wanted to see how much we owed. Sadly, we owed much more than what was explained to us. We would’ve been paying on it for 20 years. My advice is if you can buy it flat out, do so. Travel often or it’s not worth it. We weren’t able to sell our timeshare, and we owe a small amount that’s now on our credit report. Be smart.” – Leu

I was always against timeshares until I went to Aruba several years back. My husband and I went to a presentation and bought ours for less than $7,000. Doing the math we concluded that it made sense to buy since we planned to vacation in Aruba again. We estimated the purchase price of the timeshare would be the equivalent of 4 more out of pocket vacations in Aruba. We paid cash so there was no long-term commitment of a loan or finance charges. I enjoyed it for the first 5-years. The maintenance fee was low at under $300/year, but after that, it went up to over $1,000 and trading vacations was a nightmare. My honest opinion to not buy a timeshare. I’ll utilize mine until my contract of 44 weeks is up. Don’t incur that unnecessary debt for one week a year unless you have extra cash to throw away. It’s not worth it.” – Dellarita
Studies have shown that 56% percent of timeshares being returned are due to financial hardship and foreclosure. 

What To Look For:

  1. Understand that timeshares are not a real estate investment for you to make money on
  2. Don’t pay full price for the timeshare, if you can pay cash, do!
  3. Be honest about how often you really can afford to go on vacation. If you can’t go several times per year
  4. Do your RESEARCH. The Federal Trade Commission actually has great information on the rules around timeshares and what to look out for.

Buying a timeshare can be a rewarding experience and great adventure if you are smart about the lifestyle of travel you can truly live and you do your homework.

Do you have a timeshare? Is it worth it?
Your Financial Coach,
Dorethia
Dorethia Kelly, MBA is the president of Conner Financial Coaching, LLC, providing results-oriented personal finance and business coaching services. She is also the founder of the popular #MoneyChat personal finance blog, themoneychat.com and online Twitter chat hence the inspiration for… #MoneyChat THE BOOK! How to Get Out of Debt, Manage Your Money and Create Financial Security! Get your copy on Amazon today!

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