You’re Being Unfair, Barefoot

Dear Scott,

I read your article last week on Wyndham timeshare, and I think what you said was a little unfair.

We have been with Wyndham for around 10 years, and it has been great for us because we were able to pay without borrowing, and we enjoy great holidays. The accommodation is actually really good – large rooms with modern accessories and plenty of facilities (pool, gym, mini-golf, tennis court, etc).

We did the numbers, and in our situation and on our package we believe we will be ahead after 30 years. So we took the chance that we will live beyond 60 and have free holidays thereafter, plus other benefits. It is not incredibly great value, but it has suited us and we are happy to lock in holidays for the rest of our lives (health permitting).

Max

Hi Max,

You sound like you have “Stockholm syndrome” (definition: “Feelings of trust or affection felt in many cases of kidnapping or hostage-taking by a victim towards a captor”).

Did you really sit in that high-pressure sales seminar, doing your sums, and say to your wife:

“Honey, by my calculations we’ll be ahead in … 30 YEARS … let’s do this!”

You’ll only be ahead if you totally disregard the time value of your money ‒ and you don’t mind staying at the same hotel chain for the next 62 years. Consumer complaints have prompted ASIC to review timeshare holiday schemes. Let’s hope they rub these shonks out, because they’re a complete rip-off.

Here’s why:For consistency, let’s say you pay the same fees as I described in last week’s column: to get 12 nights’ accommodation in their hotels, every year for a lifetime, it’ll cost you $122,909 over 62 years … though likely significant more because they can jack up their ongoing fees by as much as 5% a year.

The same money invested in a share fund would be worth $3.7 million. And the true value of the upfront timeshare payment is less than $10,000, which is what other timeshare hostages are trying to sell them for on Gumtree.

Scott