Caught in the middle, need advice

[ElCid87]

Situation:
Parents ages 79 and 76 in declining health, unable to make much use of TS.
660,000 points Wyndham Club Access at National Harbor paid off by Dec.
Maintenance fees of $3700 / year
Me and my two sisters not on contract currently. Sisters want little to do with it
Parents are currently drafting a Irrevocable Trust for Medicare planning (5 year look back)

Questions:
Should the timeshare be placed into the trust?
Should I have my name added to the contract / deed? I seem to be the only sibling willing to give it a go...at odds with my wife. I know that in doing so I would be liable for the maintenance fees once my parents are deceased. That is what is scaring everyone.

As much money as they spent and continue to spend on it, I would like to think we can get some value out of it without too many headaches.

Thanks for your input

 

[Ty1on]

Situation:
Parents ages 79 and 76 in declining health, unable to make much use of TS.
660,000 points Wyndham Club Access at National Harbor paid off by Dec.
Maintenance fees of $3700 / year
Me and my two sisters not on contract currently. Sisters want little to do with it
Parents are currently drafting a Irrevocable Trust for Medicare planning (5 year look back)

Questions:
Should the timeshare be placed into the trust?
Should I have my name added to the contract / deed? I seem to be the only sibling willing to give it a go...at odds with my wife. I know that in doing so I would be liable for the maintenance fees once my parents are deceased. That is what is scaring everyone.

As much money as they spent and continue to spend on it, I would like to think we can get some value out of it without too many headaches.

Thanks for your input

I can't get to $3,700 based on $4.53 per thousand points including club fees and plus partners fees, closer to $3K.

If they are VIP status, and you want it, you should do whatever you can to get your name on it if your siblings don't. You can't get VIP status otherwise without laying out tens of thousands. If he puts your name on it, and none of the others want any part, make sure he specifies it to you in his will, so there is no drama over it when the time comes.

Even if it turns out you can't afford to keep it, it will have resale value if you need to unload it.

 

[Passepartout]

It's resale value will be miniscule compared to what the parents paid, but that's timeshares today.

The two pertinent questions. Do you want the timeshare? and Can you afford something like $300/mo for it?

If you want it, simply put it in the parents' will. Don't mess with the revocable trust, because that would entail re-titling it for a few $100's plus $299 to Wyndham. It would pass to you in a will along with VIP status (if such exists) for less $$$.

If neither you nor other siblings (heirs) want it. Don't do anything. The attorney handling Probate will have a form to send to Wyndham to refuse the inheritance. In this case, don't pay anything on the MF after the last parent passes. That would simply show intent to use the timeshare. Be pretty hard then to refuse the bequest.

Best wishes...

Jim

 

[Ty1on]

It's resale value will be miniscule compared to what the parents paid, but that's timeshares today.

The two pertinent questions. Do you want the timeshare? and Can you afford something like $300/mo for it?

If you want it, simply put it in the parents' will. Don't mess with the revocable trust, because that would entail re-titling it for a few $100's plus $299 to Wyndham. It would pass to you in a will along with VIP status (if such exists) for less $$$.

If neither you nor other siblings (heirs) want it. Don't do anything. The attorney handling Probate will have a form to send to Wyndham to refuse the inheritance. In this case, don't pay anything on the MF after the last parent passes. That would simply show intent to use the timeshare. Be pretty hard then to refuse the bequest.

Best wishes...

Jim

660K points probably has a resale value around $5K at least.

 

[Passepartout]

660K points probably has a resale value around $5K at least.

Whooppee! For which you pay nearly $4K a year for the privilege of using? Be still my palpitating heart.

 

[Ty1on]

Whooppee! For which you pay nearly $4K a year for the privilege of using? Be still my palpitating heart.

The point being that you don't just let Wyndham have it if you can sell it for something immediately. I'm sure there are folks here who would start the purchase process immediately.

 

[Ty1on]

Situation:
Parents ages 79 and 76 in declining health, unable to make much use of TS.
660,000 points Wyndham Club Access at National Harbor paid off by Dec.
Maintenance fees of $3700 / year
Me and my two sisters not on contract currently. Sisters want little to do with it
Parents are currently drafting a Irrevocable Trust for Medicare planning (5 year look back)

Questions:
Should the timeshare be placed into the trust?
Should I have my name added to the contract / deed? I seem to be the only sibling willing to give it a go...at odds with my wife. I know that in doing so I would be liable for the maintenance fees once my parents are deceased. That is what is scaring everyone.

As much money as they spent and continue to spend on it, I would like to think we can get some value out of it without too many headaches.

Thanks for your input

PS if you have your name added to the deed now, that WOULD kill any shot of refusing inheritance if that is what you decide to do, as you will already own it. If you talk your wife into taking it on, your name on the deed would make it easier than moving it to your name after inheritance, not to mention make it easier to use yourself over the next hopefully 20-30 years of his life if that is an option.

 

[ElCid87]

PS if you have your name added to the deed now, that WOULD kill any shot of refusing inheritance if that is what you decide to do, as you will already own it. If you talk your wife into taking it on, your name on the deed would make it easier than moving it to your name after inheritance, not to mention make it easier to use yourself over the next hopefully 20-30 years of his life if that is an option.

Thanks everyone for your quick responses.
I think they are Gold VIP (grandfathered in under lower required points) Silver if not.
Will the timeshare be counted as an asset by Medicare?, if so then wouldn't it make sense to shelter it and avoid probate as well? I will be both the executor and the trustee.
I am wanting to start taking some use now but it's difficult having to go through my mom and her relying on phone inquiries vs internet. I would pay them some to help offset some cost as it is costing just doing nothing. They are willing to do this but I think it would be easier to add my name so that I would be able to get online access and book myself. Do I like the thought of $300 a month or more eventually, of course not but I think it is doable and if it becomes a burden then hopefully be able to get out of it. Really hope to make it work.

 

[VacationForever]

Parents are currently drafting a Irrevocable Trust for Medicare planning (5 year look back)

I believe you mean Medicaid.

 

[ElCid87]

I believe you mean Medicaid.

You are correct, my mistake.

 

[Ty1on]

Thanks everyone for your quick responses.
I think they are Gold VIP (grandfathered in under lower required points) Silver if not.
Will the timeshare be counted as an asset by Medicare?, if so then wouldn't it make sense to shelter it and avoid probate as well? I will be both the executor and the trustee.
I am wanting to start taking some use now but it's difficult having to go through my mom and her relying on phone inquiries vs internet. I would pay them some to help offset some cost as it is costing just doing nothing. They are willing to do this but I think it would be easier to add my name so that I would be able to get online access and book myself. Do I like the thought of $300 a month or more eventually, of course not but I think it is doable and if it becomes a burden then hopefully be able to get out of it. Really hope to make it work.

Here's what I'd do. Add your name. Then explain to your wife that you all are stuck with it now, so you may as well enjoy it

Gold has some value to you (your parents) as an owner. If you give that up, you lose both the grandfathered points, and the idea of ever getting back to VIP without paying ridiculous retail costs. And btw if it is Club Wyndham Access, you are right about the $3,700, I didn't read "Access" at first. That even has MORE value on the market. But, if it is CWA, it is not at National Harbor, it's a club membership that isn't tied to a home resort. Every resort with CWA units is considered your home resort. The advantage here is that you could possibly learn how to find the most desirable weeks in the system, then rent them out, to defray the maintenance fees. You won't get rich, but you could put those costs within reason for your family and still have points left for vacation.

 

[Passepartout]

You are correct, my mistake.

Not to put too fine an edge on it, but are the parents wealthy? Medicaid is for the poor. The allowable assets are darn few. A timeshare, in this case would be a 'wash'. No value. If the time came for it to be liquidated in order to provide self-pay assets for a month or two, that's what Medicaid is for. Not to hide substantial assets in order for taxpayers to provide for their care.

Jim

 

[VacationForever]

Not to put too fine an edge on it, but are the parents wealthy? Medicaid is for the poor. The allowable assets are darn few. A timeshare, in this case would be a 'wash'. No value. If the time came for it to be liquidated in order to provide self-pay assets for a month or two, that's what Medicaid is for. Not to hide substantial assets in order for taxpayers to provide for their care.

Jim

Irrevocable trust is intended to hide assets, including for the rich who prefers to pass their wealth on to heirs and spend taxpayers money for their long term care. It is legal but whether it is ethical is another discussion.

 

[Ty1on]

Irrevocable trust is intended to hide assets, including for the rich who prefers to pass their wealth on to heirs and spend taxpayers money for their long term care. It is legal but whether it is ethical is another discussion.

We all, rich or poor, pay through the nose in various ways because of the rules politicians set. If someone can use those rules to get something back after a lifetime of paying in, I won't fault them a bit.

 

[ElCid87]

Not to put too fine an edge on it, but are the parents wealthy? Medicaid is for the poor. The allowable assets are darn few. A timeshare, in this case would be a 'wash'. No value. If the time came for it to be liquidated in order to provide self-pay assets for a month or two, that's what Medicaid is for. Not to hide substantial assets in order for taxpayers to provide for their care.

Jim

Without going into too much detail, father would have to private pay. Doing more for my mom's sake due to the way he structured his retirement payouts. A good portion of monthly income disappears once he passes. Assisted living at $60k a year would deplete the nest pretty quick with nursing homes even more. Just trying to make sure she is taken care of if dad goes first. Not looking for a free ride, just being prudent.

P.S. Know costs from personal experience with mother in law before she passed in Feb.
Looking for advice, not to start a debate on ethics. No hard feelings on my part and hopefully non on any one else's part as well

 

[CO skier]

I am wanting to start taking some use now but it's difficult having to go through my mom and her relying on phone inquiries vs internet. I would pay them some to help offset some cost as it is costing just doing nothing. They are willing to do this but I think it would be easier to add my name so that I would be able to get online access and book myself. Do I like the thought of $300 a month or more eventually, of course not but I think it is doable and if it becomes a burden then hopefully be able to get out of it. Really hope to make it work.

Timeshares should provide enjoyable and memorable vacations for families, no matter what price was paid. Your description of the situation does not meet this standard, as no one seems to have a use for 660K Wyndham points.

The only value left in this timeshare is the (hopefully many) memories it provided to the family and its current market value. There is no chance of ever extracting anything close to what your parents paid for it. (Sorry, but that is the harsh truth).

You and your parents need to decide now, while they are of sound mind to decide and sign the paperwork whether to 1) sell it as soon as possible for the most they can get or 2) deed it all over to you.

You write that you can only use "some" of it. What about the rest?

There are many possibilities for a five year plan, but I see only two from your description:

1) Sell it now for the best price (someone wrote $5,000). Add in $3,000/year MF savings = $20,000 value over the next five years.

2) Deed it over to you (cost = $299). Even if you can rent every reservation at a 100% mark-up that would be $30,000 rental income minus $15,000 dollars MF minus taxes plus all the headaches of advertising, rental contracts, your time, etc. nets $15,000 and the aggravation plus whatever you can sell if for in five years -- who knows, but it probably won't be much different than $5,000 today. Total value over the five years = $20,000 minus taxes.

So why put yourself through all the hassle of renting and your wife through all the stress of paying five years of maintenance fees?

Avoid all the uncertainty of trusts, wills, probate, paperwork for someone who may no longer be able to make their own decisions (I had personal experience with that involving my parents) and do what you can to force a decision with your parents -- sell it now, or deed it to you now. All the rest, including Medicaid, is just overthinking what should be a straightforward decision.

The decision seems obvious to me (sell it now), but you know more about the situation and what you are up for (renting?) than I do.

Best of luck to you, your parents and your family whatever you decide.

 

[Ty1on]

Timeshares should provide enjoyable and memorable vacations for families, no matter what price was paid. Your description of the situation does not meet this standard, as no one seems to have a use for 660K Wyndham points.

The only value left in this timeshare is the (hopefully many) memories it provided to the family and its current market value. There is no chance of ever extracting anything close to what your parents paid for it. (Sorry, but that is the harsh truth).

You and your parents need to decide now, while they are of sound mind to decide and sign the paperwork whether to 1) sell it as soon as possible for the most they can get or 2) deed it all over to you.

You write that you can only use "some" of it. What about the rest?

There are many possibilities for a five year plan, but I see only two from your description:

1) Sell it now for the best price (someone wrote $5,000). Add in $3,000/year MF savings = $20,000 value over the next five years.

2) Deed it over to you (cost = $299). Even if you can rent every reservation at a 100% mark-up that would be $30,000 rental income minus $15,000 dollars MF minus taxes plus all the headaches of advertising, rental contracts, your time, etc. nets $15,000 and the aggravation plus whatever you can sell if for in five years -- who knows, but it probably won't be much different than $5,000 today. Total value over the five years = $20,000 minus taxes.

So why put yourself through all the hassle of renting and your wife through all the stress of paying five years of maintenance fees?

Avoid all the uncertainty of trusts, wills, probate, paperwork for someone who may no longer be able to make their own decisions (I had personal experience with that involving my parents) and do what you can to force a decision with your parents -- sell it now, or deed it to you now. All the rest, including Medicaid, is just overthinking what should be a straightforward decision.

The decision seems obvious to me (sell it now), but you know more about the situation and what you are up for (renting?) than I do.

Best of luck to you, your parents and your family whatever you decide.

Your math is a tad fuzzy. In scenario 1, it represents a profit of $5K and a savings of potential costs of $20K. In scenario 2, what is really happening is an immediate profit of -$299 and a 5 year profit of $15K AFTER same $20K costs are realized. So scenario 2 is $8K ahead of Scenario 1 in cash flow. I'm not arguing that he actually could double his money, I don't believe he could. But if he could just offset half his MF using 220,000 points, which is doable, then he has 440,000, or two nice vacations weeks, to play with for $1,850 per year. Go 60 day and get the 35% discount and the numbers can even look better.

I interpreted him to represent that he really wants to keep and make use of these points if possible. This transitions it from lifetime memories for one generation to lifetime memories for the next, and that's what a lot of buyers have in their heart when they make these initial investments.

 

[CO skier]

Your math is a tad fuzzy. In scenario 1, it represents a profit of $5K and a savings of potential costs of $20K. In scenario 2, what is really happening is an immediate profit of -$299 and a 5 year profit of $15K AFTER same $20K costs are realized. So scenario 2 is $8K ahead of Scenario 1 in cash flow. I'm not arguing that he actually could double his money, I don't believe he could. But if he could just offset half his MF using 220,000 points, which is doable, then he has 440,000, or two nice vacations weeks, to play with for $1,850 per year. Go 60 day and get the 35% discount and the numbers can even look better.

The costs for either scenario are $3,000 MF/year times five years = $15,000. I have no idea where you got $20,000 costs.

The 100% mark-up assumed the VIP discount.

As noted, only the OP can do the whole financial analysis based on the actual MF numbers, discounts, and what reservations they think they can get for a 100% mark-up -- and then only to do worse, cashwise -- not vacation-wise, than selling now.

 

[Ty1on]

Your math is a tad fuzzy. In scenario 1, it represents a profit of $5K and a savings of potential costs of $20K. In scenario 2, what is really happening is an immediate profit of -$299 and a 5 year profit of $15K AFTER same $20K costs are realized. So scenario 2 is $8K ahead of Scenario 1 in cash flow. I'm not arguing that he actually could double his money, I don't believe he could. But if he could just offset half his MF using 220,000 points, which is doable, then he has 440,000, or two nice vacations weeks, to play with for $1,850 per year. Go 60 day and get the 35% discount and the numbers can even look better.

The costs for either scenario are $3,000 MF/year times five years = $15,000. I have no idea where you got $20,000 costs.

The 100% mark-up assumed the VIP discount.

As noted, only the OP can do the whole financial analysis based on the actual MF numbers, discounts, and what reservations they think they can get for a 100% mark-up.

It's actually nearer $4,000, as when I said $3K I hadn't noticed that it was CWA.

And I'll put it in simpler terms:

1) You can sell now for $5K, and at the end of 5 years have $5K. Any vacations would be rented out of pocket.
2) You can keep, offset half the MF by renting 1/3 of the points, and at the end of 5 years have vacationed 10 weeks in higher end resorts for ~$10,000.
3. If you are lucky, keep, offset all the MF with 2/3 of the points, and at the end of 5 years have vacationed 5 weeks in higher end resorts free.

 

[CO skier]

1) You can sell now for $5K, and at the end of 5 years have $5K. Any vacations would be rented out of pocket.

Or they can keep it and in five years, as the way the situation is described, they will have $0 and 5 years of MF on 660K points that were only use for a few weeks here and there by one person in the family.

By now, the OP is probably sorry they asked.

 

[Ty1on]

Or they can keep it and in five years, as the way the situation is described, they will have $0 and 5 years of MF on 660K points that were only use for a few weeks here and there by one person in the family.

By now, the OP is probably sorry they asked.

I don't think he should be....I think he is seeing all the possibilities and risks.

And you are right, if he isn't going to be prone to rent or use his points, he would be paying money for nothing.

 

[lizap]

Completely agree with this. Taxpayers should not have to foot the bill for nursing home care after placing assets in trust.

Not to put too fine an edge on it, but are the parents wealthy? Medicaid is for the poor. The allowable assets are darn few. A timeshare, in this case would be a 'wash'. No value. If the time came for it to be liquidated in order to provide self-pay assets for a month or two, that's what Medicaid is for. Not to hide substantial assets in order for taxpayers to provide for their care.

Jim

 

[SMHarman]

Irrevocable trust is intended to hide assets, including for the rich who prefers to pass their wealth on to heirs and spend taxpayers money for their long term care. It is legal but whether it is ethical is another discussion.

'rich' is a loose use of the word.

This is also beneficial when one parent is much sicker than the other and those assets ate needed nit just for care of the sick parent but care of the healthy one.

 

[theo]

Yessa!

Timeshares should provide enjoyable and memorable vacations for families, no matter what price was paid. Your description of the situation does not meet this standard, as no one seems to have a use for 660K Wyndham points.

The only value left in this timeshare is the (hopefully many) memories it provided to the family and its current market value. There is no chance of ever extracting anything close to what your parents paid for it. (Sorry, but that is the harsh truth).

You and your parents need to decide now, while they are of sound mind to decide and sign the paperwork whether to 1) sell it as soon as possible for the most they can get or 2) deed it all over to you.

You write that you can only use "some" of it. What about the rest?

There are many possibilities for a five year plan, but I see only two from your description:

1) Sell it now for the best price (someone wrote $5,000). Add in $3,000/year MF savings = $20,000 value over the next five years.

2) Deed it over to you (cost = $299). Even if you can rent every reservation at a 100% mark-up that would be $30,000 rental income minus $15,000 dollars MF minus taxes plus all the headaches of advertising, rental contracts, your time, etc. nets $15,000 and the aggravation plus whatever you can sell if for in five years -- who knows, but it probably won't be much different than $5,000 today. Total value over the five years = $20,000 minus taxes.

Avoid all the uncertainty of trusts, wills, probate, paperwork for someone who may no longer be able to make their own decisions (I had personal experience with that involving my parents) and do what you can to force a decision with your parents -- sell it now, or deed it to you now. All the rest, including Medicaid, is just overthinking what should be a straightforward decision.

The decision seems obvious to me (sell it now), but you know more about the situation and what you are up for (renting?) than I do.

Best of luck to you, your parents and your family whatever you decide.

Very well said and very astutely analyzed, IMnsHO.

OP: I too recommend energetically pursuing option 1) above. Get rid of this while it has some market value and your aging parents can still sign pertinent sale and transfer documents --- simplify their (and your) life. It does not seem to me that you would ever extract sufficient future value if you take over this ownership and (unwisely, IMnsHO) choose to hang this costly albatross around your neck. You would very likely regret that decision later; being a "reluctant landlord" and dealing with bargain-hunting, indecisive and schizophrenic renters while trying to just break even is a time consuming hassle. Bid it all adieu now and just be done with it forever.

Just my personal opinion; it is of course ultimately your choice. I too wish you good luck, whatever you decide.

 

[vacationhopeful]

Very well said and very astutely analyzed, IMnsHO.

OP: I too recommend energetically pursuing option 1) above. Get rid of this while it has some market value and your aging parents can still sign pertinent sale and transfer documents --- simplify their (and your) life. It does not seem to me that you would ever extract sufficient future value if you take over this ownership and (unwisely, IMnsHO) choose to hang this costly albatross around your neck. You would very likely regret that decision later; being a "reluctant landlord" and dealing with bargain-hunting, indecisive and schizophrenic renters while trying to just break even is a time consuming hassle. Bid it all adieu now and just be done with it forever.

Just my personal opinion; it is of course ultimately your choice. I too wish you good luck, whatever you decide.

Theo (section highlighted in BOLD and RED has done a great recap on the issue of getting too many points and becoming a landlord. I have been a landlord for regular houses & apts for years .... timeshare renting is just about the same business .... lots of people who can't decide, no one who wants to pay what you are asking as their "friend" found a place for hundreds per week cheaper. I regularly hear variations of "the plane tickets & rental car is cheaper TUES to TUES verses the SAT to SAT timeshare schedule ... and THAT is what I need ... oh, you would have to take 45% less in what you are asking for rent, as we HAVE to eat out ALL our meals when on vacation (for the wife to enjoy herself)."