Vacations on the cheap

Living in Indiana is made bearable by the number of vacations that we take. We probably traveled a little less last year than we did before having Kaia, and we still traveled quite a bit. Last year we all flew to Kauai in January, Paul to Minnesota and myself and Kaia to New Hampshire in February, to the Bahamas in May, to Minnesota, North Dakota, and Marco Island, Fl in June, to South Carolina and myself to Boston in July, to Big Sky, Mt in August, to North Dakota a few times in August and September, to Mazatlan, Mexico for Thanksgiving in November, and myself to New Hampshire in December.

But, I think people would be surprised to find out how little we actually spend on vacations. First of all, all that air travel cost us less than $600 total. It cost so little because of my husband’s awesome job. He works for an airline and thus gets free or incredibly reduced travel benefits. There is a catch, though. We fly standby and have learned to be very savvy about how we fly. There are the “non-rev rules” for increased likelihood of boarding an aircraft. You must attempt the first flight of the day. Check loads. Check again. Then check again. Always have a backup plan. Don’t dismiss travel on or over holidays.

Before last year, we traveled quite frequently but usually stayed in, um, how shall I say, a more modest type establishment. Well, let’s be honest, we stayed in dumps. They were cheap. We never really cared b/c we got to go to amazing places and see incredible sights. We stayed in a convent in Rome and a dormitory turned hotel in the summer in Montreal when we had Lasik surgery there. There is so much character in places like that.

During our travels we sometimes had the opportunity to stay in timeshares which generous friends gave us as gifts or for cost (the reservation booking feeand guest certificate fee) b/c otherwise they would lose it and they didn’t have funds or vacation time to use it. We attended the timeshare sales pitches but never even considered buying. It seemed like such a rip-off. Then we attended one in Hawaii. The salesman there explained a little secret in the timeshare business that would suit us perfectly. But there was no way we were going to buy there, from him. It was way too expensive.

There are certain fees associated with timeshare purchases. One is the upfront purchase price. Then there are closing costs, annual maintenance fees which vary wildly depending on where you buy property, and annual points membership fees. Once you have an account, you pay a reservation fee each time you make a booking. The key to finding a good deal is to find a timeshare with the lowest constant costs: low annual maintenance fees and the highest corresponding value of points. The maintenance fees are the cost that varies considerably between locations. So do the point values.

However, we didn’t need a lot of points b/c of the tip that the salesman in Hawaii told us about. With RCI, within a 45 day window, “weeks” resorts will let remaining vacant units go for 9000 points or less. Some of those same units “cost” 60,000 points or more if you book more than 45 days in advance. During the 45 day window, many go for less than 9000 points. The least that we’ve seen is 6000 points. But we never plan our trips more than 45 days in advance. We don’t know what flights will look like that far in advance. So it suits us perfectly.

We bought our timeshare on ebay. We bought a place in Florida that very likely we will never visit. However, it had low annual maintenance fees and enough points for us to take at least 2 week long vacations with points each year. Being timeshare owners, we also found that we have access to their last-minute deals, called last call, which allow you to book units within the next two months without using any points at all. The costs for these units are very reasonable: $250 for a week in a 2 bedroom unit, $225 for a 1 bedroom and $200 for a studio. Usually resorts let places go for “last call” when it is off season or when they are new resort, or they are just not filling to capacity for whatever reason. We added my in-laws, who are retired, as owners on our points account so that they could access this benefit without using a guest certificate (which costs extra). They just got a place in Florida, last call, for this week. It was great. We went down for the weekend to stay with them. I just cannot believe what a great deal it is.

Now, I know what you’re thinking. It all sounds great, but what are the actual numbers? Show me the money, right? So, let’s compare apples to apples. The salesman in Hawaii wanted to sell us a place in Hawaii for $14,000. The associated point value was 60,000 per year. The annual maintenance fee was $850. Then there were closing costs of $2000 and the annual points membership fee of $125. Audible gulp, at least for us.

We bought, on ebay, a place in Florida for $350. The closing costs were $450. The annual maintenance fees are $285. Our annual points membership fees are the same, $125 per year (there are no deals on those unless you prepay for several years, which we actually did for $100 per year). The points value is 35,000, every other year, or 17,500 points each year. It gives us a little less than 2 weeks vacations each year at 9000 points each. We can choose to look for places that are less than 9000 points per week or we can “rent” points from RCI for the low price of 2 cents per point. So, if we needed to rent 500 points, it would cost $10. I think there may have been a minimum/maximum number of points that you can rent, but we haven’t had to do that yet. We’ve always found places for less than 9000 points if that’s what we needed to do. We also focus on the last call specials available if we don’t want to use points. We could also “borrow” points from ourselves, from future points years, if we didn’t want to “rent” extra points. We haven’t had to either so far. And, the best part, we can access all the same resorts that buying into that expensive Hawaii timeshare would've allowed us.

Our constant annual outlay, not including the initial costs of purchase, is only the maintenance fee and points membership fee. If we use points, we also pay a booking/reservation fee of $164 for the week. Our timeshare vacations this last year included a 1 bedroom unit in Kauai, a huge studio in the Bahamas, a 2 bedroom huge place on a lake in Big Sky, MT, and a gigantic 2 bedroom place on the water in Mazatlan, Mexico. Only Kauai and Big Sky required using points, the Bahamas and Mazatlan were “last call” specials. Our total annual cost for all these places was:

Points membership fee: $100
Reservation fees: $164, $200, $164, $225 (these vary based on resort but the most we’ve paid is $250 for a last call)
Points used: 18000 (only Kauai and Big Sky required using points)
Annual maintenance fee: $285

So our annual cost was approximately $1138.
The upfront purchase cost that we spent of $800 I think is fair to divide over, let’s say 10 years, so we can assume an annual cost of $80 for that.

To be fair, many of the resorts charge “hidden” fees, like a state/visitor tax (you’d pay this in a hotel, too), a cleaning fee, electricity or a/c fee, etc. However, they are all clearly indicated before you book the resort so you know what you will have to pay. Last year Kauai and the Bahamas had visitor taxes in the amount total of around $100. In the interest of full disclosure, sometimes resorts will charge extra for wifi access or extras like cribs or highchairs.

So our total annual cost, including divided upfront purchase and hidden fees, last year was $1318. For 4 weeks of vacations in what I consider luxurious condos, that comes out to $329 per week, or $47 per night. Not too shabby, huh? We couldn’t even get a dump in Lihue, Kauai for that price.

Vacationing with a child really makes this a bargain. Considering the alternative of sharing a hotel room or booking multiple rooms, the convenience of having a kitchen and many times multiple bathrooms (many of the 2 bedroom units have 2 bathrooms as well), staying in a condo is much more comfortable.

I’m not saying everyone should run out and buy a timeshare. I just wanted to share how we’ve found a way to go on vacation for a price that fits into our budget. I think we enjoy vacations even more knowing that we are doing them in a financially responsible way.