More “Money Mistakes” from a fellow blogger. This time we have Jila from Happier Freelancing, below are her thoughts and experience with owning a timeshare, enjoy!
Tell us a little about yourself
Hi, my name is Julia & I’m the writer behind Happier Freelancing where you can find all-in-one resources and tutorials to start an online business, including freelancing, blogging, eCommerce, and gig work.
Online business and gig work won’t make me a millionaire overnight, but it allows me to earn a college degree without a student loan and pay off my mortgage in 8 years. I’m officially debt-free in my mid-30s!
Creating additional sources of income is one of the best financial safety nets for anyone. Taking small steps to create financial safety nets will give you more choices during unexpected hardship.
However, I’ve made some money mistakes along the way of my debt-free journey. Yes, I made a stupid money decision.
I’m here to share my money mistakes so you won’t make the same mistake. Spend your money smarter! (Don’t be like me)
What was your money mistake and when did you make it?
We bought a timeshare at Hilton a couple of years ago. The average timeshare for a new buyer is around $22,000. It is way expensive for Impulse buying. Guess what? We bought a timeshare on impulse.
We paid more than the average timeshare prices smoothly. It was magic.
What led you to making the mistake?
Hilton was fully prepared to sell this timeshare ownership program with high-pressure sales tactics and mind games presentation. (Possibly a little bit of brainwash.)
At first, Hilton offered us a free night stay at Elara Las Vegas in exchange for participating in a timeshare presentation. My husband loves freebies. He immediately signed up without knowing about the timeshare presentation.
The office was located in a nice place with amazing views. Free coffee and food (breakfast wraps, muffins, fruits, snacks, etc.) were available.
Nice luxe sofa, free food & coffee as well as amazing views. In that situation, some people get excited and make decisions to buy a timeshare on impulse easily. I don’t know why, but it happened.
How did you recover from it?
After the timeshare presentation, I googled about the timeshare a lot. Most of the salespeople are not telling you everything. They tend to only show the best-case examples.
Our salesperson explained all the various fees and maintenance costs of owning a timeshare with a tone like “it’s not a big deal.” In fact, the cost of owning a timeshare is a lot. It’s not a one-time payment. Owners need to pay the fees and property taxes as long as they own the timeshare.
Our sales rep also said that timeshare is an “investment,” but it’s not. A timeshare is not an investment. There is no value as “property.” A lot of people complained that it is nearly impossible to sell a timeshare.
Because of that, timeshares are ideally paid for upfront. Borrowing money to purchase a timeshare is not a smart financial decision. We finished our timeshare mortgage within a year to prepared/saved money for property taxes and other fees instead of paying high interest.
What would you have done differently?
We wouldn’t buy a timeshare, or we would buy a used timeshare to save some money.
Timeshare is very difficult to sell means it’s a great opportunity for buyers. We can get enough club points to stay in a suite room every year for 75-95% discounts. We still need to pay for property taxes and maintenance fees, but we don’t have to pay full price for the property.
I was pretty shocked when I saw $1 timeshare ownership on eBay.
Please note that the timeshare reselling industry has a few well-known scams. Never pay for a promise. Pay for what you get.
How can others avoid the same money mistake?
First, don’t participate in timeshare presentations.
If you want a free night stay at Hilton in exchange for participating in a timeshare presentation, be honest. Tell the sales team that you have no interest in buying a timeshare. Do not give too much information about yourself, especially household income and your job. Sales team members need to talk with you for an hour. (That’s their job) So, they’ll keep asking you tons of questions.
If you are interested in buying timeshares, remember timeshares are like swimming pools. You are owning it for fun. The retail value of timeshare property is zero or reasonably close to zero. Timeshare is pricey entertainment. Maintenance fees and property taxes are different by location. Find the cheapest location! You can stay at any Hilton Grand Vacation property no matter where you buy/own.
Most importantly, what did you learn from your money mistake?
There is nothing more expensive than something free. If you accept something for free or extremely cheap, you might end up having to spend more than what you thought you had gained.
Anything else you want to say?
If you own Hilton Grand Vacations and use them fully, please follow me on Twitter and share your timeshare experience with me! I would like to know about your vacation experience (: I hardly ever find happy timeshare owners on the internet… so I would like to connect with someone who actually enjoys timeshare.
Jeff is a fan of all things finance. When he’s not out there changing the world with his blog, you can find him on a run, a Mets game, playing video games, or just playing around with his kids.