Dave Ramsey doesn't like timeshares

[davewasbaloo]

FWIW, even if we do not all agree, I think having this debate on here is worth while for any new readers. Also, am more sold on resale than I ever would have been if I wanted to buy in the US.

 

[SueDonJ]

For me there is very little appeal, but I wanted to use this as an example that not everything is right for everyone! If it were driveable, it would be much more attractive (I feel this way about Palm Springs too).

Others might say they would never want own in the old beet fields near Disneyland, 25 miles from central Paris!

My winking smiley was there for a reason.

Oh, see, I forgot my smiley because I was in the death throes.

You're right, though, and you used much fewer words than I did to say my point - not everything is right for everyone! Excellent job.

 

[SueDonJ]

Agreed, I apologize...

Thanks.

 

[josh1231]

As a general rule of thumb, Dave Ramsey is correct. Dave Ramsey is against debt. Most people end up financing timeshares, often times at rediculous interest rates that are masked with points and the promise of a tax deduction. This is what he's against. He has a lot of people call into his show that have paid $30K for a timeshare with huge maintenance fees, and they can't sell it because it's worthless.

He is also against bad performing investments, which mathematically a timeshare bought from a developer is. I'm not bashing developer purchases. There are many reasons a lot of people on this board buy from the developer. It's a lot more convenient, safer, etc.

I am a big Dave Ramsey fan and agree with most everything he says. He is an expert in personal finance though, not timeshares. I believe if you have spare money and no debt, there is no reason not to buy a timeshare, even if it's from the developer if it is going to bring you enjoyment. As most have said here if you're buying it as an investment, probably shouldn't do that. If you're buying it as a way to have fun and you have no debt, than I say go for it.

As far as a new car goes, it is a bad purchase financially when compared to a used car. No matter what excuse you use to buy a new car, mathematically you're wrong. That being said if you have the money to pay cash for a new car, and it is worth reducing your stress level by driving a new car, Dave Ramsey probably wouldn't be against that by what I have heard on his t.v. show.

 

[davewasbaloo]

I hear you on this stuff. I used the car analogy as it was the closest thing I could think of in depreciation terms. For many years, I had a car user allowance and drove about 40k a year. A new car with inclusive servicing and 3yr or 60k warranty made sense.

For my wife, who does the school run and grocery store, the odd visit out of town and a secondary back up/MPV for us to use to go to the dumps or take extended family/friends, a 2nd hand car was a better choice.

 

[Bill4728]

Clark Howard also is really down on TSs.

BUT at least he says on his website, "IF you want to buy a TS, buy resale."

 

[josh1231]

I hear you on this stuff. I used the car analogy as it was the closest thing I could think of in depreciation terms. For many years, I had a car user allowance and drove about 40k a year. A new car with inclusive servicing and 3yr or 60k warranty made sense.

For my wife, who does the school run and grocery store, the odd visit out of town and a secondary back up/MPV for us to use to go to the dumps or take extended family/friends, a 2nd hand car was a better choice.

I'm not trying to say that you shouldn't buy a new car, I'm just saying it probably cost you more than buying a used one.

Take the BMW 550. A 2009 BMW 550 will cost you $55,000, and that is if you can get the dealer to take slightly less than invoice. You get free maintenance on this car I believe. A 2007 BMW 550 will cost you $36,000, or $19,000 less. You can get alot of maintenance for $19,000.

I'm not saying it's not worth it to you to pay the extra money. I'm just saying you're still paying more for it if you put a pen to it.

 

[ldanna]

I have a couple of wealthy friends and they would never consider owning timeshares. I have talked about how wonderful they are and here are their reasons that they aren't interested.

This particular study I read defined milionaire as someone that has a million dollar. If you have a great job, and spend thousands of dollars, drive a fancy german car, live in a nice house, a boat for the weekend, you may not be classified as a "milionaire". Ask something about those waelthy people you know: are their houses payed in full or the house in fact belongs to the bank? What about the car? Do they have a milion dollar on their bank account or properties? They can spend a lot of money but don't have any savings.

Usually people that spend a lot of money cares a lot about what others will think about them, and I agree TS must be very embarassing for some folks.

Some folks here have more than half a dozen weeks on really good resorts, all gold and platinum, probably bought direct (more than 90% of all TS sales are direct). The value of those weeks are more than the value of a good house in the US. And MF should be at least $6k a year for TS (a good monthly salary for lots of people), not to mention they have to use these week (air tickets, rental cars, and so on). So TS is defenetly a luxury that only wealthy people can affort.

TS, let's mention only the good ones, are for people that like to travel a lot, a luxury for those who can affort it, marvelous for those who understand how it works. And for people like Tugers (and Tombo that I am quoting here) that don't care about the others because they don't pay our bills!

 

[AwayWeGo]

Nobody's Business if I Do.

They can spend a lot of money but don't have any savings.

I would prefer to be considered poor even though I have a little money than be considered rich even though I'm in hock up to my eyebrows.

And I much prefer staying in luxury timeshares for Motel 6 & Super 8 rates over making monthly payments on my maxed out Visa & Master Charge & Discover & American Express accounts.

Full Disclosure: We drive around in paid-for used cars. Nothing fancy, but it beats walking. Plus -- no monthly payments. Is this a great country or what?

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[AwayWeGo]

Mox Nix.

Without an original buyer, there would not be resale available.

True, but immaterial.

If there were no original timeshare buyers & thus no timeshare resales, we could live with that.

I can't think of anything we own that's more trivial & nonessential than our outstanding (resale) timeshares.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[tombo]

This particular study I read defined milionaire as someone that has a million dollar. If you have a great job, and spend thousands of dollars, drive a fancy german car, live in a nice house, a boat for the weekend, you may not be classified as a "milionaire". Ask something about those waelthy people you know: are their houses payed in full or the house in fact belongs to the bank? What about the car? Do they have a milion dollar on their bank account or properties? They can spend a lot of money but don't have any savings.

Usually people that spend a lot of money cares a lot about what others will think about them, and I agree TS must be very embarassing for some folks.

Some folks here have more than half a dozen weeks on really good resorts, all gold and platinum, probably bought direct (more than 90% of all TS sales are direct). The value of those weeks are more than the value of a good house in the US. And MF should be at least $6k a year for TS (a good monthly salary for lots of people), not to mention they have to use these week (air tickets, rental cars, and so on). So TS is defenetly a luxury that only wealthy people can affort.

TS, let's mention only the good ones, are for people that like to travel a lot, a luxury for those who can affort it, marvelous for those who understand how it works. And for people like Tugers (and Tombo that I am quoting here) that don't care about the others because they don't pay our bills!

My friends I was referring to have multi millions cash in the bank, they don't owe a dollar on their homes, and they don't finance anything. They have multi million dollar summer homes in the Highlands NC and they own multi million dollar homes they reside in. They mostly drive Toyotas and Volvos and Lexuses, no BMW's or Mercedes as most think they are a waste of money. One of my friends has a paid for $8 million dollar home on the beach in Naples FL, a multi million dollar home in Virginia, and a million dollar cond in Washington DC. I didn't want to give details as they really weren't necessary until asked if they are really millionaires. When I say wealthy millionaires, I mean just that.

I am not wealthy :annoyed: , I just have some wealthy friends I met in college who remained friends even though I remained middle class. I can afford timeshares (I own over 20) and I am not wealthy. I owe money on my home and on one of my cars, and none are german. My friends who are very wealthy wouldn't consider owning a timeshare, and I doubt that many people laying next to you at the timeshare pool are millionaires. Millionaires don't typically want the trouble of owning timeshares. If they want this type of lifestyle they pay to vacation or if they really like a locale they buy a home there.

I simply listed the reasons they gave me for not being interested when I was bragging on all the places I have gone and all the trips I made purely because I own timeshares. They explained to me how many of the places I was bragging on they had been to also and how cheaply they had made their trips using travel agents. They also talked about the places they love to go like Bali, Shell Haii (sp?), St Kitts, trinidad, Tobago etc where there are few timeshares. I am not one of the priviledged few who can travel where I want whenever I decide to go. I own timeshares and try to travel wherever I want as cheap as I can.

I was not giving you a scientific study surveying hundreds of millionaires, I was simply telling you how the limited number of millionaires I know personally feel about timeshares

BTW, if you own a half dozen really nice timeshares right now and sell them, the proceeds from all 6 sales probably won't be enough to buy you a double wide trailer.

 

[dashulak]

The Millionaire Next Door

It's interesting, but all of us probably know millionaires and don't even realize it. Some dear friends live in a neighborhood of $250,000 - $500,000 homes, drive Volvos, and enjoy a modest lifestyle. Their net worth is around $20 million! Others teeter on the edge of bankruptcy with mortgages they can't afford and credit cards run up to the maximum (lots of smoke and mirrors IMO)!

Our timeshare is a pre-paid vacation with first class accomodations for far less that we'd pay if we rented -- it's absolutely not an investment!

 

[dmaxdmax]

I think that for most people timeshares are like puppies, spouses and Miatas. You get one because you want one, not because it makes financial sense. Of course it might indeed make financial sense but that's not why you pull the trigger.

I don't think that the average TUGGER bears any resemblance to the average timeshare owner.

 

[ldanna]

Tombo, I have a couple of friends that fly on their personal jets all the way from Brazil to Orlando with their famlies, and belive me I spend a better time at the Grande Vista that they do at the Floridian on WDW.

If you're trying to have cheaper vacations you would go to Motel 6 or TravelLodge, nothing to invest for $59 or $69 dollars a night. But you're going for quality vacation, which is very different, and still cheap (MF for a week if you do not consider the what you bought first).

The study I read didn't say anything about multi millionaires, but million dollar people: a comfortable house with the space they need, no expensive booze on regular basis, still married with their first wife (who knows how to cook BTW), made in usa cars, some japanese. This is comon stuff to million dolar men. Low profile. That's the kind of people you may find at the pool, but they won't let you know how much money they have. People I know that have TS fit this profile or are almost there.

 

[dioxide45]

It's interesting, but all of us probably know millionaires and don't even realize it. Some dear friends live in a neighborhood of $250,000 - $500,000 homes, drive Volvos, and enjoy a modest lifestyle. Their net worth is around $20 million! Others teeter on the edge of bankruptcy with mortgages they can't afford and credit cards run up to the maximum (lots of smoke and mirrors IMO)!

Our timeshare is a pre-paid vacation with first class accomodations for far less that we'd pay if we rented -- it's absolutely not an investment!

This reminds me of I think it was a Lending Tree TV ad. The guy talked about all the great stuff he while riding on his lawnmower, had and then asked "How did I get it all, I am up to my eye balls in debt" Or something to that effect.

 

[tombo]

This reminds me of I think it was a Lending Tree TV ad. The guy talked about all the great stuff he while riding on his lawnmower, had and then asked "How did I get it all, I am up to my eye balls in debt" Or something to that effect.

I loved that commercial!!!

 

[AwayWeGo]

None Of Our Timeshares Give Us Prepaid Vacations.

Our timeshare is a pre-paid vacation with first class accomodations for far less that we'd pay if we rented -- it's absolutely not an investment!

Nothing is prepaid about any of our timeshare vacations, even though we got the actual timeshares for peanuts (relatively speaking).

We have to keep on paying those everlasting annual maintenance fees every year, year after year, world without end, amen.

So it goes.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[dioxide45]

I had never heard of Dave Ramsey and I am sure most others didn't until the Fox Business Network came along. Suze has been on TV for most of this decade.

Suze a while back actually had someone on her Can I Afford It Segment that wanted to buy a $100K timeshare in Whistler I think. She is not a fan of them and believes the same thing Dave does. If I remember correctly she approved them They had wads of money that they could afford to waste if they wanted to. She suggested though that they just pay to vacation when they wanted and to avoid timeshare. She not once mentioned to them to look at resale and probably pick up the same week for pennies on the dollar.

Truth is Dave and Suze are money experts, not timeshare experts. There are situations where TS makes sense for people. There are many more situations where TS does not and those are the people they are talking to. If someone pays $40K developer for a TS and gets use of it for 20 years. That is $2000 a year for their use, not counting any other costs (MF, interst). I can stay in a lot of places for less than $2000. If I only use it for 10 of the 20 years I have it, my cost jumps to $4000 for each week each year. There are people out there who buy and maybe use the week a few times then they just think about it again until the MF bill rolls in. I know someone just like this, they get lots of vacation a year and own a TS but never use it. Not even open to letting others in their family to use it either. They could send their grown and married kids on some good vacations. For most people, it just doesn't make financial sense to buy TS...

 

[davewasbaloo]

Nothing is prepaid about any of our timeshare vacations, even though we got the actual timeshares for peanuts (relatively speaking).

We have to keep on paying those everlasting annual maintenance fees every year, year after year, world without end, amen.

So it goes.

True that is not free, not even close. But you have to admit that maintanence fees do work out to be much cheaper than paying cash for a villa the quality of a Marriott, in fact they work out about the same as an economy business hotel room.

 

[davewasbaloo]

I find it so hard to believe there are so many owners out there that do not make use of their purchase!

 

[littlestar]

I find it so hard to believe there are so many owners out there that do not make use of their purchase!

Before I learned about Tug and the great information on this site on how to use your timeshare for trading, my family (mom, dad, and sister) didn't know they could lock off their two bedrooms and deposit them as two deposits with Interval. Nor did they know what those AC's were that were given to them. The AC's went unused because nobody really knew what they were. My sister had been receiving an AC every year for her Maui week and never used any of them before we found out about Tug.

My sister-in-law who is a hair stylist told me she has a customer that owns DVC points and the lady just lets the DVC points expire each year because she is older now and doesn't travel to Orlando anymore. Is that crazy or what?

 

[davewasbaloo]

My gosh. We must have had a a really good sales rep. He kept trying to sell us a 3 bed so we could lock off, and explained how it all worked. We didn't go for it as it seemed like a lot more (I wish we had back then). He also explained how the a/c's worked and we made use of those in our 1st year! Awesome.

As for the DVC lady - crazy!

 

[AwayWeGo]

Having It All -- Luxury + Economy.

But you have to admit that maintanence fees do work out to be much cheaper than paying cash for a villa the quality of a Marriott, in fact they work out about the same as an economy business hotel room.

We think of it as enjoying luxury timeshare accommodations for Motel 6 & Super 8 rates.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[Twinkstarr]

My gosh. We must have had a a really good sales rep. He kept trying to sell us a 3 bed so we could lock off, and explained how it all worked. We didn't go for it as it seemed like a lot more (I wish we had back then). He also explained how the a/c's worked and we made use of those in our 1st year! Awesome.

As for the DVC lady - crazy!

It wouldn't surprise me, the one lady up the street has a Westgate unit in Orlando and they've used it a few times. They end up depositing it, forget to make a request(didn't know you could look at II online, thought you had to call). I know they've had 2 deposits that have expired, as I offered to look up locations availability etc for her.

 

[m61376]

Very true. I have a close friend who bought a ski week direct 3 years ago. Traded it the first year for a 2BR summer Maui, used the 1 BR the second year and traded the studio for a November NCV - so far so good- and this year forgot to trade it in for points and forgot to deposit it (they may have at least made a Flexchange deposit). Very smart, professional people. Life intervenes and what to do with your week takes a back burner and is all too often forgotten.

There is a reason a surprising percentage of weeks go unused each year. I forgot the figures- they were posted awhile back- but wasn't it close to 10%?