A timeshare is usually too expensive, even if someone gives you one
Vacations during the summer months might have you thinking about timeshares for resorts in places like Florida or Mexico. They seem like a fun idea for a winter vacation in the sunshine, as well as a good deal financially. They are usually neither.
Like Groundhog Day
One of the biggest problems with timeshares in general is that they can lock you into a specific vacation. Spending a week at that resort in Mexico in February, exploring the local area and relaxing by the pool, might be wonderful for a year or even several years. But eventually you may get tired of going to the same location, doing the same things and seeing the same people. After a while, even a rut person might want to do something different.
Some timeshares mitigate this problem by participating in vacation exchanges, but these services can add on fees.
Not Easy to Sublease or Sell
You might think that, if you get tired of a timeshare, you can just sublease or sell it. These aren’t necessarily easy to do. There may be restrictions on subleasing, which is another good reason to read the fine print before you sign any timeshare contract. Selling is often difficult, and you certainly aren’t likely to get back your original purchase price. Meanwhile, you pay annual fees whether you use the timeshare or not.
Annual Fees are High
In figuring the cost of a timeshare, those annual fees are what can really get you. The timeshare company has to tell you up front what the fees are at the time you buy. Yet you have no control over what the fees may be in five or ten years. The only thing you can count on is that they will increase.
As most timeshare sales reps will tell you, comparing the cost to buy a timeshare versus the cost to stay as a non-member, it would usually take decades to recoup the purchase price. In fact, most sales reps will be quite clear that a membership is probably not a good financial investment. Instead, they’ll describe it as an investment in lifestyle.
When it comes to timeshares, that is the bottom line. If the lifestyle that’s on sale truly fits you, and you believe it will continue to fit for the long term, then it’s possible that a timeshare may make sense.
For most people generally, however, a timeshare is too expensive even if someone gives you one. The annual fees alone can keep it from being a good value. Paying for a hotel stay costs less in the long run, and you can enjoy relaxing vacations with no long-term commitments.
When you take a close look at the numbers and the restrictions, timeshares generally don’t add up to a good value.
Investing in Your Vacation
Why do most avoid this important investment?
Why do so many of us not use our vacation days? Salespeople talk about “leaving money on the table.” Well, employees leave vacation on the table. And the cost to us is significant.
In fact, Americans leave 429 million vacation hours on this proverbial table, according to a report from Forbes. And USA Today reports that, according to their study, over 30% of employees do not use all of their vacation days.
People discuss investing in your career, like investing in an education or in a certification. Maybe we should talk about another investment that could pay dividends in your career, which is, of course, the place where you make your money. Is investing in vacation a good idea, or just hokey, happy talk?
Reasons That People Skip Vacations
Why do employees avoid vacation? There are several reasons people give for missing out on vacation days:
- “I’m afraid that I’ll be fired.” This is the idea that your boss expects constant work and looks down on those “snivelers” who dare to take a break.
- “A hard worker should keep his nose to the grindstone and perform.” This is related to the other reasons, and it also involves some allegiance to the idea that hard work is the key, over-arching purpose of life.
- “I don’t want my colleague to impress the boss more while I’m away.” People worry about not getting that promotion if they take time away from the office.
These reasons are largely self-imposed. As noted below, most managers understand the benefits of vacation to their employees, not only for employee morale but also for his or her performance on the job. Your boss is not Ebenezer Scrooge, despite what you might think.
Research studies support the idea of taking your vacations. A University of Pittsburgh study found that leisure activities, including vacations, contributed to less depression and more positive emotions, along with lower blood pressure and smaller waistlines. These results are not surprising, since vacation reduces stress. As reported elsewhere, 80% of workers feel stressed on the job, and 70% of doctor visits are due to stress-related conditions.
According to Forbes, not using vacation time is bad for business. Most managers recognize the benefits of taking time off from work because their employees will be more productive, have better workplace morale, and are more likely to stay. Importantly, the health benefits of vacation result in employees missing fewer days for illness and less time for medical appointments.
So, based on the studies and the interviews of managers and executives, what are these benefits of taking a vacation? There are, of course, personal benefits to going on vacation or taking a “staycation,” where you stay at home during your time off. You can enjoy your life more and become closer to your partner, your kids, and your friends. You become physically healthier, too.
However, taking time off can provide substantial benefits for you in your job or career. To summarize, taking your vacations can:
- Reduce stress, which helps in so many ways.
- Increase productivity at work, after you return. Taking a break from work and doing what some have called a “digital detox” refreshes you.
- Increase creativity, for those times when a better approach or new idea is needed.
- Improve your relationships with other workers, so that you’re more positive about projects and less likely to be irritable or say things that you regret later.
Of course, things that help you at work also help your company. And many employers know this, from their experience with other workers and managers who take vacations and then perform better. So, vacations are not only beneficial to you, but they also benefit your company.
As one executive put it, according to Forbes, “We seem to be wired to put the pedal to the metal, but there are also undeniable benefits to tapping the breaks.”
Using your vacation time, and using it wisely, helps you to become a better employee, which can only help your company. And most managers understand this. Being a better employee will result, naturally, in a higher salary or a better job.
Investing in vacation, therefore, is both an investment in your own well-being and in your career and salary. Remember to invest in your vacation, just as you invest in your retirement, your education, or your house.
Women & Higher Money Risk – The higher risk of not having sufficient money in retirement is real
Women are more vulnerable to financial insecurity because they typically live longer, have more breaks in their employment and earn less. Making the right financial decisions is therefore crucial for all women, from Social Security to the rest of their retirement planning. Technically speaking, Social Security is gender-neutral. However, a combination of several factors creates different levels of retirement security for women and men.
Here are some of the main reasons that a woman has a higher risk of not having sufficient money in her retirement years:
More Breaks in Employment. Women have less time in the workforce due to pregnancy, childcare or family care responsibilities, resulting in lower Social Security benefits than men. According to the most recent data from the Department of Labor, women are more likely than men to be out of the workforce or to have breaks in employment. In fact, 74% of women between 25 and 54 were in the workforce, compared with 89% of men. The gap widens in the 55-to-65 age group.
Women Earn Less. Despite the wage gap shrinking over the past few decades, women still earn less than men, generally speaking.
- In fact, according to the most recent data from the Social Security Administration:
The median earnings of working-age women who worked full-time, year-round were $40,000, compared to $50,000 for men.
Exacerbating the issue, the average annual Social Security income received by women 65 years and older was $13,891, compared to $17,663 for men.
- For unmarried women – including widows – age 65 and older, Social Security comprises 45 percent of their total income.
- In contrast, Social Security benefits comprise only 33 percent of unmarried elderly men’s income and only 28 percent of elderly couples’ income.
- 46 percent of all elderly unmarried females receiving Social Security benefits relied on Social Security for 90 percent or more of their income.
Women Live Longer. A woman at 65 is expected to live 2.2 years longer than her male counterpart. Further, according to a study by the Center for Retirement Research at Boston College, the odds women need nursing home care is higher, and they spend more time in care than men.
During retirement, women are more likely to be single, widowed or divorced. Since most women have older spouses, they are likely to end up widowed without the financial assistance their husbands may have provided.
Consider this sobering statistic: While the poverty rate of a married couple over 65 is only 4.2%, the poverty rate of a post-65 single woman is 20.3%.
What to Think About.
It sounds obvious, but women can develop a more secure future and worry less about running out of money during their retirement years by becoming much more involved in and owning their overall financial planning.
And making the right financial planning decisions and the right Social Security choices are two of the most important actions a woman can make for her retirement.
Is it time to have THE TALK? Not that one, but the other difficult one: Aging Parents and Money.
Let’s face it getting old is hard. Your parents’ ability to manage their own finances may decline as they age. Helping them with money matters is a sensitive issue you need to approach carefully.
When you hit a certain age of your life, you may realize that one topic keeps coming up in conversations with your friends: care for aging parents. The concerns aren’t limited to health care – managing money is also a big problem.
Parents aren’t likely to recognize their own declining abilities, so knowing when and how to step in to help is important. Here are some tips:
- Watch for warning signs. When visiting your parents, take a look around the house. Are there unpaid bills piling up on the counter? If the things that are normally done are not, it may be a red flag that your parents are struggling with the upkeep.
- Be aware of the people in your parents’ lives. Make sure that you have a list handy of people you can contact, and keep the lines of communication open. Friends, caregivers and church members can offer insight to any changes in your parents’ behavior. Don’t forget your parents’ professional contacts, such as their attorney, doctor, insurance agent and financial advisor.
- Be subtle. Most people have a difficult time relinquishing control over their finances. Try offering guidance and help instead of taking over their finances completely.
Suggest that you can help balance their bank statements or set up online banking and automatic bill payments. This offers an excuse to start a discussion on their financial matters and helps relieve the stress on your parents to stay on top of everything. You can also start the conversation by purchasing a book about financial concerns and discuss the book with them.
Work with your siblings. Sharing responsibility can be tricky, but keeping everyone in the loop is critical. If one sibling lives closer, in-person tasks may be easier for him or her. Set up monthly telephone meetings with siblings to make sure that everyone is aware of the situation and can make decisions together.
Prepare a power of attorney. This is a form that authorizes you to make business or financial decisions on your parents’ behalf. If they are willing to sign and notarize a power of attorney, you have greater oversight of your parents’ finances. Make sure that you notify the family and that everyone knows who has power of attorney.
No one likes to lose independence. Helping your parents with this transition is difficult, but it’s in their best interest and yours.