The following is a guest post from Jeffrey Strain, who is a digital nomad and personal finance writer. His main website is Saving Advice
There is a lot of misinformation flying around about timeshare that can get you into a lot of financial trouble if you believe it. Most of it comes from timeshare salespeople overstating the truth that get repeated when people explain why they purchased a timeshare. But just because something has been repeated many times doesn’t make it the truth. The following timeshare myths may help you avoid running into timeshare trouble in the future. Consider each one carefully before putting your hard earned money down to purchase a vacation property.
Timeshares pay for themselves: Timeshares do not typically pay for themselves, unless the currency you are talking about is memories. Even then, you can still get those memories at a fraction of the overall cost. While the sales agent may not want to divulge this information to you, timeshares are most definitely not just about property payments. They also come with plenty of other costs, hidden fees and taxes. No matter how little you use the timeshare, you are still responsible for its upkeep, sometimes including utility costs and maintenance. These extra fees can be hundreds of dollars per year.
Timeshares are smart investments: Those interested in timeshare as potential investment opportunities should think again. Timeshare owners make money on a sale rarely, if ever. Usually, timeshare purchases end up as money-wasters rather than money-savers because the value of the property depreciates drastically over time. In bad economic times, timeshares can be especially foolish investments since they can often be impossible to give away for free sticking the owner with all the yearly fees.
Timeshares are a good value: On the surface, a timeshare might look like an excellent value because one gets to share ownership of a property he or she might not otherwise have been able to afford alone. However, when all the payments, fees, and taxes are added up which must be paid toward their timeshares, they would have saved money by taking a traditional vacation instead.
Timeshares are a safe bet: There are risks associated with every vacation and all kinds of travel, and timeshares are no different. There are numerous ways that buying a timeshare can be a risky venture, so don’t assume that buying now will reserve your vacation spot for life. many timeshares are located in places where natural disasters occur or the timeshare management company could go bankrupt just to name a couple.
Timeshares are easy to swap: Plenty of families buy timeshares with the expectation that swapping properties with others will allow them to vacation all over the world. This is not often the case, and may be more trouble than it’s worth. Even if you do have a timeshare worth swapping into, it requires a lot of research into each possible swap location before finalizing your plans. You don’t want to end up swapping to a location that has poor maintenance records, few amenities, and a bad surrounding area. Unless you join a very active network that has dozens of interested swappers every day, you might find this swapping process difficult and a hassle.
Timeshares are easy to sell: As with almost all properties these days, timeshares are not easy to sell. There are few incentives for buyers and even less demand. With so many tens of thousands of timeshares available, it’s difficult to find someone willing to take on ownership. Most people looking at the timeshare resales market know the truth about timeshares being poor investments, having many fees and the difficulty in getting rid of them making it extremely difficult to sell even during good times.
Timeshares are always well-taken care of by their owners: Just because a timeshare has several stakeholders does not necessarily mean it is, or remain, in amazing condition. Timeshares often have rules that restrict the amount of decorating and personalization that can be applied to a property. Since owners each have such a small stake in the timeshare, the upkeep and pride that comes with owning a property often falls on the maintenance staff. This can sometimes mean an inconsistent, or even run-down, quality in a timeshare.
Timeshare gifts are amazing deals: As with many other aspects of timeshare ownership, amazing advertised freebies are not all what they’re cracked up to be. Some sales agents throw in special vacation certificates, but beware. Free vacations like these end up costing unsuspecting couples and families hundreds of dollars in hidden fees. Don’t assume that these freebie vacations include costs like transportation or other undisclosed fees.
Timeshares make great places to visit year after year: Some families do enjoy revisiting the same spot each year, reliving past moments and building new traditions. This isn’t right for everyone, however, and families change over time. Your family might enjoy trying a new vacation spot each year, and trying new things, rather than repeating old ones. Consider what you enjoy most about vacations. Is it getting to try new restaurants and activities every time? Is it discovering attractions you’ve never seen in your life? If so, the consistency of a timeshare might not be your style.
Timeshares are right for everyone: Timeshares are certainly not perfect for all types of people, and if anyone tells you this is true they are probably just trying to make a sale. Timeshares are not right for a wide range of people. For instance, young couples who might start a family soon, or who are very likely to move within a few years. Timeshares might also not be great choices for older couples whose mobility isn’t what it used to be. A particular timeshare might seem like a wonderful place now, but as years go by you might not think so as your lifestyle changes. Every potential buyer should evaluate what kind of person they are, how their family and lifestyle fits into the decision, and what kinds of vacations they enjoy the most.
|SB is a husband and working as a software professional for a Fortune 100 corporation in Florida. Thanks for visiting the blog.
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