Timeshare deal like a soft ‘kick in the knee’

Dear Dave,

Some friends recently offered me a timeshare on the beach. They’ve had it for about 20 years. I’d have to pay a transfer fee of $100, plus a yearly association fee of $500. I know you’re not a big fan of timeshares, but does this deal sound OK? — Jill

Dear Jill,

In essence, you’re looking at $500 a week. I know the $500 is technically an annual association fee, but you’re basically paying $500 for your week at the timeshare. And in the future, say five years from now, the association fee could increase. You might be paying $1,000 a year at that point — again, for your week.

In actuality, the numbers you’re talking about right now aren’t completely terrible. Still, it’s not a huge blessing. In my mind it’s kind of like, “How would you like a kick in the knee that’s not too hard?”

I’d much rather spend my $500 a year on travel and be able to go and stay wherever I wanted. With a timeshare, you get charged whether you show up or not.

This one’s not as bad as if you’d have to pay $8,000 for the opportunity. But if these were my friends making the offer, I’d have to say no thanks. — Dave

Dear Dave,

I make $65,000 a year and have $34,000 in debt. I’m about to get remarried, and my new husband will make about $100,000 a year. Should I take the $34,000 and put it on my mortgage to consolidate it? — Leslie

Dear Leslie,

Please don’t consolidate this debt. You need to learn, as a couple, to make debt a thing of the past and live on a written, monthly budget. Once you’re married, your family will have a great income. You could really push and attack that debt, and have it paid off in no time.

Debt consolidation is nothing more than a “con,” because you think you’ve done something about the debt problem. But the truth is the debt is still there, all you did was move it around. — Dave

Financial adviser Dave Ramsey, daveramsey.com, can be heard from 6 to 9 p.m. weeknights on KTTH radio (770 AM).