(This piece is written by Bianca, one of the readers of MoneySmarts who has been chosen for the one-year Money Makeover challenge by INQUIRER.net. Bianca’s real identity is confidential, so that MoneySmarts can share her family’s financials and the lessons she has learned with the rest of the world. Read more about Money Makeover here.)
A financial planner (not Joe Ferreria) told us: sell your timeshare. My husband and I communicated silently the way old lovers do – with a look (or a glare, but that is another story) – and made a decision.
We will not.
I think he understood the hesitation and communicated to us his silent admonition. Insolent fools.
At the back of our minds, we had a suspicion that he was right. Not about the fool part (although we could be sometimes that too), but about our timeshare. After all, we had a strong opinion against timeshares in the beginning - a waste of money, will cause delusions of beaches along Belize, sun stroking our backs, while the Pacific mirrors our dreams.
Not that it’s a bad dream.
But believe you me, a timeshare costs an arm and a leg. It ranges from P250,000 to gazillions (think Disney timeshare - I could not even get a quote on how much that is), depending on the location of the rental, the season (red, white and blue), and how unwilling to bend the sales person is.
Think where that money could have gone – a downpayment for a new car, a new house, education….
But it does not end there. It gives birth to other expenses – yearly maintenance fees (which went up from P2,500 to P4,000 in the blink of an eye), RCI fees (S$150 annually –in Singapore dollars, but with the current exchange rate, it might as well be in US dollars), booking fees that could range from P2,500 (Asia) to almost P10,000 (outside of Asia). It does not include airfare, or the cost of food. The RCI hotels, although three or four stars, are almost always in the outskirts of the city – that means it is 30 minutes away from where the action is. With cab fares, we could have had a decent room at a city hotel with dancing lights, Prada and great food at our doorstep.
But it is not all bad, as we have found out in our two years of owning one.
With it, we only spend approximately P3,000 per night, and if the trip is stretched a week, the discount could be really substantial. Moreover, the accommodations are almost always one bedroom suites, and they say that if we are really kulit (translation: a charming prick) with the RCI agent at the other end of the line, or during low season (August to October), we could even be given a two-bedroom suite (good for 6 people). Match the hotel savings with really low airfare (through Clark, the other gateway to Hongkong, Malaysia, Singapore, Korea), it could satiate the wanderlust in anyone.
For our first trip, our family (hubby, daughter and myself) went to Malaysia and Singapore and spent P30,000 for five nights (four nights in Malaysia, one in Singapore), inclusive of airfare and food. We recently went to Hongkong and Macau (for 4 nights) and spent P40,000, also inclusive of airfare and food.
But do we recommend it?
We do not. Well, at least, not to everyone.
It certainly was not value for money to our parents, who had two timeshares. They paid approximately P700,000 for both and they got seven days at a one bedroom suite at the back of the Flamingo in Las Vegas, Nevada (the sign on the wall says $1,000 per night and that was a source of a little comfort) and seven days at a one-bedroom suite at a manor near Legoland in California. Sounds plush, but however I do the math, it is not P700,000. They tried to save up their weeks and were planning to go to Europe but travel was put off year after year after year because the kids got married, houses had to be built, the farm needed to be farmed and so forth. The timeshares expired and they never got to go.
A timeshare is a commitment. It is for people who love traveling with a passion, love to do research (for cheap airfare, great places, good food), and, at the onset, the temerity to haggle with the timeshare salesperson until that person buckles down and gives the lowest-value-for-money-price imaginable.
There will be hits and misses, we know. But we are passionately excited to see the rest of the world as a family, to hear the lyrical overtures of another language, introduce our daughter to life’s many wonders, and immerse ourselves in the magic of cultures so fascinatingly different from our own.
Our timeshare keeps the door – doors – open.
Yes. We are keeping it.
May 31st, 2008 at 4:38 am
I go by the following:
1. research and compare -farecast.com tracks fares on given periods. I also use quikbook.com, kayak.com, and other travel search engines. Check hotel/airline websites for deals and promotions. For hotels, call the local hotel, and compare with the online price and the price given via their 1-800 (central office) — yes, these rates may be different. For US business travels, I use hotwire.com and priceline.com (sometimes hotels.com) — I get the best rates from them including car rentals.
2. travel during off-peak season and book off-peak days (Tuesday to Thursday), it depends on the type of hotel. Some hotels geared for business travelers/conferences actually charge premium during midweek.
3. reserve as early as you can
4. add-on services - factor in free breakfast and other freebies into the rates and always ask if there will be additional charges (e.g., parking, internet access)
5. avail of packages that may include trave/hotel/food - for Disney, check out mousesavers.com
6. ask for a discount and inquire about promos - discounts are given, just ask.
7. friends/relatives - some people who own timeshares may be willing to let you use theirs at a discount. I have older friends who own 3 timeshares but have used them once in the last 3 years. A couple owns 1 luxury collection type hotel and 2 RCIs that that their only son does not want to inherit because 1) he does not want to also inherit the monthly maintenance fees 2) it will be another 5 years before his kids are at the age when they can appreciate it and 3) he noted RCI hotels are more “dated” and he can get better ones 4) the additional expense attributed to staying at a luxury hotel cannot yet be covered by his pre-retirement income.
8. affiliations/memberships - for every affiliation, always inquire about members perks (deals/promotions). The association handling my retirement fund invests in some luxury collection hotels although only a few members who check the annual reports are aware of it. As a perk, members who ask get rooms for $99-125/night. Friends and relatives can also avail of the rates (2 rooms at a time), but members must be there at check in to brandish IDs.
I ordered dessert in one of the hotels, and when it arrived, the presentation was worthy of a Pritzker, alas, the edible portion was also the size of a stamp. Because in my youth, I have been preconditioned to seeing mega-bigao of bibingka, my big mouth overrode my little brain, and blurted,”This is it?” much to my embarrassment. Minutes later, the server arrived, saying, “Compliments of the chef,” and gently laid a large plate of their premium dessert arranged in Stonehenge fashion with subtle splashes of color. The experience is all about the impeccable service. You get what you pay for, but sometimes, if you do it right, you also get lucky and get more than you pay for.
For those whose version of 5-star hotel is staying with relatives abroad for a vacation, please make your presence light (i.e., look after your needs). There is nothing more exasperating for a host than to come home tired from work to cook for you, drive for you, and then look for your toddler’s missing shoes. It’s hard enough living without help so that hosts juggle their schedule, rooms, and budget to accommodate guests. Most Filipino hosts are trained to be hospitable, but guests must be sensitive to the host’s needs. Do not overstay.
May 30th, 2008 at 3:27 pm
@spyware, i have a very long memory! be sure to tell us all about your experience next year!
May 30th, 2008 at 3:27 pm
@DB, you said:
People can get 50-75% at 5-star hotels/resorts, their price is normally $600 min. I stayed a week at the Ritz Carlton, and the service and ambiance was fit for royalty — at $99/night, this Ilocano farmer’s granddaughter went straight to heaven.
Way to go! More specific tips please? I can give you a huge space for that hehe.
May 23rd, 2008 at 6:24 am
I like how you show both sides of the story here. Most people these days don’t realize that there is a brighter side to timesharing, because it occasionally gets cast in shadow. Glad to hear you weren’t colored by your parents’ experiences. And your line “A timeshare is a commitment.” is very true…it’s a commitment, not an investment. Aside from you and the forum members at timeshareconsumergroup.org I have not heard very many timeshare owners actually own up to this.
May 22nd, 2008 at 2:54 pm
me and my wife bought our Marriot timeshare last Jan. 2008… we have no idea of what timeshare is but when we heard the presentation we immediately decided to buy it.. REASON BEHIND - we have this dream of traveling around the world…and if we can purchase our accommodation now then we saving a lot
well, at times i question the value of the product and our decision. but i guess this is much better than buying a car that you can only use for 10yrs!!.. our timeshare is good for 50yrs.. and we can even transfer the title to our children…
i can’t share any good moment yet since we have not avail the service… but check this blog next year i will give you a detailed field report…
May 18th, 2008 at 10:59 am
Hi don2x, timeshare owners are given a timeshare certificate and it guarantees that they “own” the resort for at least a week… that is as far as the “ownership” would go so it is not really “ownership” in the legal sense of the word… Yes, timeshares are offered for resort properties in the Philippines… I know that there are resorts in Boracay and a hotel in the heart of Ortigas that are offered….
Hi Bebert, you are very much welcome…
May 17th, 2008 at 7:02 pm
Ownership terms and usage depends on the company. To keep costs down, you can buy resales, as cash-strapped owners try to unload them. For Disney, however, company has first refusal to buy-back, to protect pricing. Two years ago, Disney offered Saratoga timeshare at $14,000+ with 150 annual points that you can use to “bid” for locations, you can save/bank points for up to 2 years to get locations that cost more points (e.g., Europe). You can only own timeshare for 50 years from the time it was offered to the public (not necessarily the year you bought), and there is at least $60/mo maintenance fee.
Last week, I attended another timeshare presentation at Cocoa Beach, an RCI establishment, and stayed for one night. The cheapest offer was $13,000+ for every other year usage of an oceanfront room, unless you trade for another location elsewhere. But this one is lifetime timeshare ownership, and you can deed it to your heirs. Annual fee is about $800. Unfortunately, a lot of RCI hotels/resorts do not compare with Disney. For some, not even by a long shot. It really depends on your taste.
For timeshares, you are paying for the experience, subject to the quality of the company. But if you cannot commit to using it (well, life happens) every year, keep your money and try to find deals when you are ready to travel. If you have friends/relatives who work for companies that can give discounts or already own timeshares, even better. People can get 50-75% at 5-star hotels/resorts, their price is normally $600 min. I stayed a week at the Ritz Carlton, and the service and ambiance was fit for royalty — at $99/night, this Ilocano farmer’s granddaughter went straight to heaven. You can save your time and money for THE trip that will really be worth it, and it will not cost you the monthly worry of paying timeshare maintenance fees that may go up annually, too. Also, you get to keep $14,000 in your bank (or wherever), at your disposal, while it grows. Do your research. Good luck.
May 16th, 2008 at 10:30 pm
are there ownership titles for properties bought under timeshares? are there timehares offerred for resort properties in the philippines?
May 16th, 2008 at 4:14 pm
I learned what timeshare is from my brother, he has one in Orlando, and the family has enjoyed it very much for a long time now. Since then I viewed timeshare only from his angle. Your viewpoint certainly added a lot to my limited knowledge of the system. Thanks.