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why not to buy trust points

Fastpc2020

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So I went to a presentation at the Maui Ocean Club and thought about buying for a fraction of a second and then I did some math. First I was offered points at $9.3 each with mx feses of .41 a point. In the folowing scenario I don't assume an increase in mx fees or the cost of lodging going up. Also I assume paying the full price and no financing to keep the math simple. For arguments sake let's go with 3100 points. At the MOC this would get a 1 bed in the new section (2525 old section) garden views or every 3 years you could go twice and get a 2 bedroom but would need to buy 100 points from someone else (4700 points per week).

I'm assuming a 10 year return window. So at 9.30 a point and 3100 points that's 28830 or $2883 a year plus 1271 in mxf fees for a total of $4154 a year for the 3100 points or $1.34 a point (again no interest charges or mx fees going up.

The "true" cost of a week is 1 bed $3338 (old section) $4154 (new section) or $6298 for a 2 bed either section (these are the cheapest availible for points according to the reward charts)

Now the sanity test if I took $28830 and invested it today using a 3% rate in 10 years I'd have $38745 compounded. Now it wouldn't be 1000 a year but in the end its $10k.

Why does all the above matter? Let's see what's availible at the MOC in May. I picked date and looked them up on Marriott.com red week and eBay.

Marriott.com 5-12 May. 1 br 356 night ocean front or 399 ocean view. With a $25 daily resort fee and 7% tax thae totals are $2853 or $3175 respectively.

Red week 4-11 May $1500,1 bed, 6-13 May $2500 2bed, 5-12 may $4995 3bed

EBay 11-18 may $795 studio.

Now this is with 2 months notice. If you can plan further ahead I'm almost positive you can find what you want. Also if you want to go short notice deals can be had and you can bargain with the renters.

My point is even on Marriott website I found a better deal ($2793 vs $3338) and its an ocean view.

With points the numbers don't add up and if you have to finance the initial costs just go up. Save your money and if you love just one resort just buy a week resale.
If you like to go different places looks for deals because there out there and it doesn't always have to be a Marriott (even though it is my favorite brand)

Just my .02 cents
 
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ronparise

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I dont own Marriott, and I dont intend to, but your math exercise s or something like it should be done when you are considering a purchase from any timeshare developer...and of course when you do the conclusion is almost always the same. This stuff is just too expensive...Buy a fixed or floating week within a days drive of your home that you will use yourself and buy it on the resale market.

If you need variety, rent
 

Beefnot

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So I went to a presentation at the Maui Ocean Club and thought about buying for a fraction of a second and then I did some math. First I was offered points at $9.3 each with mx feses of .41 a point. In the folowing scenario I don't assume an increase in mx fees or the cost of lodging going up. Also I assume paying the full price and no financing to keep the math simple. For arguments sake let's go with 3100 points. At the MOC this would get a 1 bed in the new section (2525 old section) garden views or every 3 years you could go twice and get a 2 bedroom but would need to buy 100 points from someone else (4700 points per week).

I'm assuming a 10 year return window. So at 9.30 a point and 3100 points that's 28830 or $28830 a year plus 1271 in mxf fees for a total of $4154 a year for the 3100 points or $1.34 a point (again no interest charges or mx fees going up.

The "true" cost of a week is 1 bed $3338 (old section) $4154 (new section) or $6298 for a 2 bed either section (these are the cheapest availible for points according to the reward charts)

Now the sanity test if I took $28830 and invested it today using a 3% rate in 10 years I'd have $38745 compounded. Now it wouldn't be 1000 a year but in the end its $10k.

Why does all the above matter? Let's see what's availible at the MOC in May. I picked date and looked them up on Marriott.com red week and eBay.

Marriott.com 5-12 May. 1 br 356 night ocean front or 399 ocean view. With a $25 daily resort fee and 7% tax thae totals are $2853 or $3175 respectively.

Red week 4-11 May $1500,1 bed, 6-13 May $2500 2bed, 5-12 may $4995 3bed

EBay 11-18 may $795 studio.

Now this is with 2 months notice. If you can plan further ahead I'm almost positive you can find what you want. Also if you want to go short notice deals can be had and you can bargain with the renters.

My point is even on Marriott website I found a better deal ($2793 vs $3338) and its an ocean view.

With points the numbers don't add up and if you have to finance the initial costs just go up. Save your money and if you love just one resort just buy a week resale.
If you like to go different places looks for deals because there out there and it doesn't always have to be a Marriott (even though it is my favorite brand)

Just my .02 cents

One might quibble with you over the payback period, but yes I agree with your approach. It virtually never makes financial sense to purchase from the developer.

Driving distance is sensible guidance for those who want to keep it simple or who do not crave variety. Even then, we are probably a half century away from rocket-powered jet skis. Until then, the Hawaii crowd is relegated to the friendly skies...:eek:
 

Fastpc2020

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One might quibble with you over the payback period,

This is true but most will finance as well adding to the cost. I choose 10 years as a start if you own it longer the overall cost will go down but not enough in my opinion if you were to invest that initial lump sum. If you invested in more "risky" funds or stocks you return could be up to 8%. The one benefit I do see is you're heirs will have no initial cost (or very small transfer fee) but what if it isn't completely paid for due to an accident/illness then it becomes a burden.j

Lets look at 20 years 28830 over 20 years is 1441.50 + 1271 mx fees = 2711.50 . Which is less than Marriott.com but still more than the alternatives.
 
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m61376

Tug Review Crew
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Buying a resale week where you'd like to repeatedly visit will absolutely give you the best bang for the buck. The attraction of points is the flexibility, and to some people that's worth the cost; most Tuggers who advocate for points have a lower buy-in cost, in that even if they opt to purchase additional points, the bulk of their points are from legacy weeks.

In case you are unaware, if you own a Marriott timeshare, you are also entitled to substantial discounts at Marriott.com when booking villas (subject to the offer being available), which when available starts at 25% or 35% with use of a Marriott Visa to pay (MOD is the code to input on the site when looking for reservations). That's a substantial discount and can be a nice supplemental benefit to buying a resale week.
 

bizaro86

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One might quibble with you over the payback period, but yes I agree with your approach. It virtually never makes financial sense to purchase from the developer.

Driving distance is sensible guidance for those who want to keep it simple or who do not crave variety. Even then, we are probably a half century away from rocket-powered jet skis. Until then, the Hawaii crowd is relegated to the friendly skies...:eek:

Flying to Hawaii should always be cheaper than a boat at anything close to the same speed for reasons of physics. Drag is proportional to the square of velocity at high speeds, and the air is much thicker at sea level than 30000 feet. When you account for energy lost to touching the water, any boat will use much more fuel than a plane at similar speeds, and thus cost much more.

Rocket powered jet skis would be cool though. I'd probably do it once even though it'd be more.
 

Fastpc2020

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In case you are unaware, if you own a Marriott timeshare, you are also entitled to substantial discounts at Marriott.com when booking villas (subject to the offer being available), which when available starts at 25% or 35% with use of a Marriott Visa to pay (MOD is the code to input on the site when looking for reservations). That's a substantial discount and can be a nice supplemental benefit to buying a resale week.

But are the DC points the same as the trust points? Are they all in the same pool now?

As for the discount I've seen that mentioned before but I do know that platinum elite members (hotel rewards) also receive offers. We had received one a month ago for Hawaii of upto 40% off and as a back up I had MOC booked for 4 nights at 199.

It all gets down to what your goals are. Prepay for vacations or invest that capital. As long as your happy that's what really matters. Its almost like buying a car once you drive it off the lot it's yours and has already depreciated just with these trust points who knows how you'll be able to sell them.
 

EKniager

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Do the math again with a re-sale platinum week, a 2-bedroom lockoff and assume you will use it split as two weeks with 1-bedroom. Throw the rental rates of Aruba in February in there for good measure, as well. :whoopie: ;)
 

Bill4728

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I dont own Marriott, and I dont intend to, but your math exercise s or something like it should be done when you are considering a purchase from any timeshare developer...and of course when you do the conclusion is almost always the same. This stuff is just too expensive...Buy a fixed or floating week within a days drive of your home that you will use yourself and buy it on the resale market.

If you need variety, rent
I agree with this but want to add "If you need variety, rent" OR TRADE.

We own several TSs that we generally don't use anymore not because they aren't nice but because we can trade them for even nicer TSs for a reasonable cost. If you can vacation like we do in the fall there is almost always a great resort available for us to trade into.

Bill
 
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