When my family and I used to Holiday on the Gold Coast, we always planned to do at least one of the Theme Parks. We would, as we hit the Cav Mall precinct, bit accosted by pushy sales people offering almost ‘too good to be true’ ticket prices for the Theme Parks. I think from memory it was like $69 for my family of four to get into Dreamworld as opposed to the gate price of about $290. But there was a catch to this amazing ticket price. Melanie and I had to attend a 90 minute seminar on a ‘fantastic investment opportunity’ with Wyndham International Resort group. Which I has happy to attend as I am thinking it’s saving me $200 for 90 minutes….that’s a good hourly rate.
So we attended the seminar.
I went in with the mindset there is no way I am signing up for anything…..just give me my tickets.
So I sat through the 45 minute presentation, the 15 minute tour of the rooms (in one of the motels) and the 30 minute meeting with a salesman who seemed way too concerned about the value for money I was getting from my holiday dollar.
Now I can’t remember the exact details of the deals on offer, but as I have an Economics Degree, my brain is a little wired toward figures, and I do remember thinking the figures that they were talking about….look ok up front, but as my brain was doing the calculations over the life of the contract, they were astronomical in size….with what seemed to be a little ‘nebulose’ on the benefits.
Anyway we didn’t sign up for anything and I got my cheap tickets.
And I did that twice.
But they are still operational on the Gold Gold and I came across a letter to the Barefoot Investor (Scott Pape) in the Sunday Telegraph yesterday (15th July 2018), where Scott had worked the figures. (Praise the Lord)
As I like to expose scams and companies that blatantly rip people off, I thought I would give you some of the text in the Barefoot Investor’s reply.
But before that. Here are some links to some of my blogs exposing dodgy companies.
- Exposing Nimble–Dumb Little Loans:- Deceptive Little Company
- Financial Rape of Australians by Wallet Wizard, Cash Converters and Loan Ranger: Peter Pilt’s Thoughts.
- A HUGE WARNING: For Those Hiring a Car from Europcar. I Have Been Unfairly Slugged For Damage
The writer to the Barefoot Investor, Jess, said this:
We recently went to an investment seminar where we offered a chance to buy into a vacation club with an international resort group called Wyndham. There were a number of different options, but the one we are looking at is a mid range offer: we pay $22,146 upfront (financed at an interest rate of 13.15% over five years), plus a $746 annul levy. That entitles us to 7000 credits which equates to 12 nights accommodation in their hotels every year for a lifetime. What are your thoughts?
This is part of the Barefoot Investor’s reply:
After 5 years you’ll have paid $34,066. Yet it get’s worse…much much worse. The real issue is the annual fee. The PDS states that you’re signing a legally binding contract that commits you to pay the $746 annual fee until….wait for it….2080.
This is regardless of whether you actually used a hotel.
And the annual fee can be increased every year. Based on a 2% increase (The PDS states that the increase can go as high as 5%), the total cost of this timeshare will be $122,909.
Additionally there are all sorts of restrictions around when you can book room and additional fees that you can be slugged for.
Let me put it another way…If you’d invested $22,146 plus $746 a year over the same period of time into a share fund, you’d end up with $3.7 million in your back pocket. Yes you wouldn’t get the benefit of staying in the hotels over the 62 years…but $3.7 million can afford you more motels.
He goes on to point out that there is no termination clause in the 62 year contract on offer.
He also points out that there are people on Gumtree offering their $22,146 upfront timeshare payment plan for $10,000 (negotiable).
For me I was happy to get my cheaper Dreamworld Tickets…..I smelled a rat during the presentation but clearly lots of people sign up as they have been offering these ‘deals’ for years now.
Another example of how Australians are a bit dumb when it comes to financial scams and this is the reason why I post this blog…….You work hard for you money….part with it very wisely.
Oh and don’t get me started on the Novotel Accor Club swindle (I was a part of this for 6 years until I got sick of being ripped off).
Anyway, that’s what I think.
Here are some of my other blogs you may be interested in:
- Financial Seminar Notes: How to do better with what you already have.
- Loyalty Means Absolutely Nothing to Corporate Australia. Be Disloyal to Save Money.
- Why do Australian Companies act like Nigerian Money Scammers???? A Personal Story.
- A Guaranteed Way to Make Money on the Stockmarket
- Seven Eleven Petrol Stations No Longer Have Restrooms. I Am Out As A Customer!