Owning a timeshare may be the perfect way for seniors to enjoy vacation destinations all across the world. That said, it’s important to be wary of potential pitfalls that may cause seniors to pay more than they should. To help seniors ease into their golden years, below are 3 tips to help secure a timeshare that fits their needs as affordably as possible.
Understand Your Ownership’s Responsibilities and Limitations
In most cases when you buy a timeshare in the U.S., you’ll get what’s called a “timeshare state” which allows you to rent, sell, exchange, and pass down to heirs your share of the property. However, outside of the U.S., you are usually only provided with “timeshare licenses” or “memberships”. These allow you to use the property for only as long as the contract permits and typically enforce other restrictions. Seniors should also know that signing a contract for a timeshare outside the U.S. means that you are not protected by U.S. laws.
More specifically, the types of timeshares available to seniors include:
- Timeshare ownerships: Timeshare ownerships allow travelers to purchase one week of access per year. Timeshares are designed so that each unit has about 52 individual owners, each with access to the unit annually.
- Fractional ownerships: Companies that sell fractional ownerships make units available to owners anywhere from 2 to 12 weeks per year. These properties are often more upscale than standard timeshare properties. Owners can choose how much stake they want in a property, whether that’s for 1/26 of a property or 1/13.
- Variety of ownership plans: Some companies have properties that sell both timeshares and fractional ownerships and thus attract a broader base of clientele with different wants and needs.
Additionally, it’s worth noting if you’re buying an unfinished timeshare, the Federal Trade Commission recommends that money be placed in an escrow account registered to a local bank until the property is completed, and be sure to include a “non-performance” clause in the sales contract. This is to help protect you in the case that the timeshare developer goes bankrupt or defaults before the property and unit are finished. Finally, like any other owned property, you have to pay required maintenance fees and property taxes each year. Otherwise, the timeshare company has the ability to foreclose the property.
Don’t Get Distracted By Extra Perks
Timeshare companies know that it’s almost always cheaper to buy from existing owners on listing sites than to buy properties from them. To counteract this, timeshare companies often offer closing incentives and other perks. However, you will almost always save more money by ignoring these perks and buying from an existing owner than to buy from a timeshare company with extra perks.
Fees that seniors can expect to pay when dealing with timeshares include:
- Annual fees: Some timeshare companies charge timeshare owners annual fees to maintain ownership of their timeshare; these fees start at a fixed rate and often increase through the years of ownership.
- Fee-free: Timeshare companies that are fee-free charge means owners owe nothing more than the cost of buying into the timeshare. This means that once the timeshare owner has purchased their right to use the property, they never have to pay the timeshare company again.
- Maintenance fees: Timeshare owners often pay additional maintenance fees that increase every year to cover things like weather-related damage or damage caused by natural disasters.
Choose a property that fits your travel needs
The main benefit of having a timeshare is that you’re able to trade your own timeshare for other timeshares in other destinations around the world. Therefore, you should know how to do that. Seniors that are part of a larger group or resort network can simply trade internally, otherwise, they’ll have to go through an exchange company such as RCI. Not only do exchange companies like RCI require you to pay additional membership and exchange fees, but they also don’t guarantee that you get the exchange you want. This is why seniors should prioritize timeshares that allow them to trade internally with other owners.
Seniors should also understand their timeshare’s schedule, which can include:
- Fixed schedule: Fixed schedule timeshares allow owners to access their unit at a specific, fixed time each year; this means that for the length of their purchase, timeshare owners will return to their timeshare on the same dates annually.
- Floating schedule: Timeshares with a floating schedule designate an amount of time a timeshare owner can access their timeshare each year, and they can choose the dates they want. This is a good choice for consumers who may be changing jobs or school situations and will want to vacation at a different time depending on the year.
- Combinable time: Some timeshare companies allow customers to skip timeshare weeks, and then make up their vacation time during another year or at a later date. While these are less common, they do allow for travelers to skip a short vacation one year to then go on a much longer one the next year.
Schedules also depend on the destination restrictions related to your timeshare, which include:
- One destination timeshare: A company with one destination for timeshares has only one location for owners to vacation.
- Multi-destination timeshare: Some resort timeshare companies have a number of properties where owners can choose to vacation.
- Points-based timeshares: Points-based timeshares have multiple locations that are each worth a certain level of points. Timeshare owners only have access to high-level properties after accumulating points from buying into properties or purchasing points from the company.