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An Easy Guide to Understanding Time Sharing

Most people hear the words “time share” and immediately think of scam artists and empty bank accounts. It was a punchline on SpongeBob, for crying out loud. But most folks don’t understand what a time share is to begin with. There may be some risks involved, but going in with both eyes open can allow for a profitable decision anyway.


A timeshare is basically just what it sounds like. Purchasing a room at a vacation resort is going to be outside the pay grade of almost everyone, so a timeshare allows for lots of people to essentially pool their resources to pay for it and then share their time that they will spend there. This is of course handled by a company that serves as an intermediary to handle scheduling, maintenance and so on. Some time share plans are not for a specific resort or location but are part of a network of destinations that can be used by the purchaser.


There are two basic forms of ownership when it comes to time shares. The first is the classic one but has been declining in popularity in recent years. This is purchasing a specific time, usually a week, when the room or cabin or what have you will be reserved and no one else can come.

The disadvantage here, of course, is that the rest of the world does not automatically schedule itself around the timeshare weekend. Some companies have floating weeks that are not immediately assigned but are first come first serve, so everyone gets a week, but it might not be the best week.

The second form of ownership, popularized by the Disney Vacation Club, uses points. The purchaser gets a number of points every year or so depending on how much has been paid into the system. These points can be banked and redeemed for accommodations and sometimes travel, food and entertainment while in town.

Many timeshare owners will trade or sell points with other members, or even rent out their timeshare weeks and points to others for a nice profit. This allows the owner to recoup potential losses if they are unable to use their time share in the given period.


So, what is the big panic about timeshares? Mostly, it has to do with the old “assigned week” system, because it amounted to a lot of people paying money into a system that was very difficult for them to use. The points system helps with this, but the other caution is the high-pressure marketing that gets thrown at buyers to upgrade to the next level of membership or for extra perks to keep those payments coming in strong, especially when the payoff date draws close! Refusing to make snap decisions and sticking to a strong budget and plan can help alleviate these concerns.

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