Summer Vacations & the Allure of Timeshares

Summer Vacations & the Allure of Timeshares

July 31, 2019

A timeshare is usually too expensive, even if someone gives you one

Vacations during the summer months might have you thinking about timeshares for resorts in places like Florida or Mexico. They seem like a fun idea for a winter vacation in the sunshine, as well as a good deal financially. They are neither.

Like Groundhog Day

One of the biggest problems with timeshares in general is that they can lock you into a specific vacation. Spending a week at that resort in Mexico in February, exploring the local area and relaxing by the pool, might be wonderful for a year or even several years. But eventually you may get tired of going to the same location, doing the same things and seeing the same people. After a while, even a rut person might want to do something different.

Some timeshares mitigate this problem by participating in vacation exchanges, but these services just add on fees.

Not Easy to Sublease or Sell

You might think that, if you get tired of a timeshare, you can just sublease or sell it. These aren't necessarily easy to do. There may be restrictions on subleasing, which is another good reason to read the fine print before you sign any timeshare contract. Selling is often difficult, and you certainly aren't likely to get back your original purchase price. Meanwhile, you pay annual fees whether you use the timeshare or not.

Annual Fees are High

In figuring the cost of a timeshare, those annual fees are what really get you. The timeshare company has to tell you up front what the fees are at the time you buy. Yet you have no control over what the fees may be in five or ten years. The only thing you can count on is that they will increase. 

As most timeshare sales reps will tell you, comparing the cost to buy a timeshare versus the cost to stay as a non-member, it would usually take decades to recoup the purchase price. In fact, most sales reps will be quite clear that a membership is probably not a good financial investment. Instead, they’ll describe it as an investment in lifestyle.

When it comes to timeshares, that is the bottom line. If the lifestyle that’s on sale truly fits you, and you believe it will continue to fit for the long term, then it's possible that a timeshare may make sense.

For most people, however, a timeshare is too expensive even if someone gives you one. The annual fees alone will keep it from being a good value. Paying for a hotel stay costs less in the long run, and you can enjoy relaxing vacations with no long-term commitments.

When you take a close look at the numbers and the restrictions, timeshares simply don't add up to a good value.

Important Information

The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.
Aspire Planning Group LLC a d/b/a of HighPoint Advisor Group, LLC (“HPAG”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where HPAG and its representatives are properly licensed or exempt from licensure.
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