Last Updated on September 12, 2026 by T.J. Fitzgerald
A subscriber named Jake asked a simple question: what do I think of timeshares?
I do not like them. That answer, though, led to a longer list. I keep seeing retirees—and people trying to catch up later in life—buy things that look useful on the surface and then quietly drain wealth. Look closely and most of these purchases have limited utility, rising carrying costs, or both.
The objective is not perfection. It is to maximize the retirement portfolio, generate as much positive cash flow as practicable, and build a plan with maximum utility. Late starters have a shorter runway. Every dollar that stops leaking can go to work sooner.
Here are eight items I personally stay away from, and what I see more disciplined retirees do instead.
1. Timeshares
Timeshares can look like a smart real estate move. You lock in a week. You “own” a vacation. The pitch is familiar.
The problems show up after the sale. Maintenance fees tend to rise. Travel plans change. A timeshare is usually reserved for a given week or weeks, so flexibility shrinks. If you go to the same place at the same time every year, know the area well, have rented there first, and the math truly beats renting, it can make sense for a narrow group of people. Even then, it is a permanent bill.
What I would do instead: keep capital liquid and rent when I actually want to go. Certainty is the thing you give up. Availability is often there if you know where to look—private rentals included. The dollars that would have gone into a timeshare can sit in a cash-generating asset that pays you on a schedule instead of sending you an annual fee.
One example some late starters consider is a performing seller-financed real estate note backed by real property as collateral. There is no climbing annual fee attached to the vacation itself. Every situation is different. Run the numbers with an advisor you trust.
2. New luxury vehicles on a short replacement cycle
This is not an argument against driving a nice car. It is an argument against treating a depreciating asset like a revolving subscription.
A fair number of retirees trade vehicles every two or three years. That pattern almost guarantees a car payment. Depreciation is worst in the first 36 months. A well-built car chosen to last still needs maintenance. That is normal. What it does not need is a $600 or $800 monthly payment competing with retirement funding.
Redirect that payment and the picture changes. The same monthly amount can help fund a small real estate note or a partial note purchase. Instead of a depreciating asset with a payment going out, you have an asset generating monthly income. Positive cash flow—especially passive cash flow—is the point.
3. Boats that sit most of the year
Plenty of boat owners use the boat fewer than 20 days a year. If that is your pattern, think twice, maybe three times, before staying invested in one.
A boat is not an investment in the usual sense. You have carrying costs, insurance, maintenance, storage, and depreciation. It can be a drain on the portfolio. If you are an aficionado and the use justifies the cost, that is your call. Caution is the only point here.
For my part, I would rather rent the experience when I want it and keep as much capital as possible available for cash-generating investments—again, including a note that pays out every month. As we get older, the runway to improve portfolio performance gets shorter. The clock is audible. That is not paranoia. It is arithmetic.
4. Second homes and vacation homes
A getaway place that is “all yours” sounds excellent. On the surface it can look like a real estate move.
Ask how often you will actually go. Then add taxes, insurance, maintenance, and extra bills. You often end up with an expensive second mortgage and little or no cash flow unless you rent it. Renters bring their own headaches.
The allure is availability on a whim. My default philosophy is the opposite: money flowing in rather than out. Capital that would otherwise service a second home can go into a cash-generating asset such as a seller-financed real estate note. Yields can be structured above many current market rates, you have a claim on the property as collateral, payments arrive on a schedule, and the borrower typically handles the roof, taxes, and similar carrying items on the collateral property.
Results vary. Talk with a qualified professional before treating any of this as a fit.
5. Permanent life insurance sold mainly as an investment
Whole life and some universal policies have a real death benefit. That part is not imaginary. They also carry high internal costs.
When you turn the illustration inside out and stress-test the investment piece with real-world assumptions, that piece often underperforms the broader market after commissions and charges. Separating protection from growth is cleaner. Buy term for the years you need coverage. Steer the premium difference into assets you control.
A late starter might allocate that difference into secured notes inside an IRA or a taxable account, depending on the rest of the plan. Test the investment component of the policy with realistic assumptions. The gap is often larger than the illustration suggests.
6. High-fee actively managed funds and complex packaged products
One to two percent a year in layered fees has to be counted if you want the true performance number. Over a 15- to 20-year retirement stretch, that money never reaches you. You are earning less than the broader market by roughly the fee drag.
Keep public-market costs as low as possible. I also look for private income where yields and fees are easier to see. With proper due diligence, notes written in the 8% to 12% range with real property as collateral are simpler to evaluate than a multi-layer prospectus. Your circumstances are unique. Check with your own advisors before you decide.
7. Collectibles bought mainly for appreciation
Art, wine, and similar items are fine as hobbies. They are weak as core retirement assets. You have storage, insurance, and the liquidity problem: you need a future buyer who agrees with your price.
Keep hobbies as hobbies. Keep the bulk of capital in measurable cash flow. Compare a note that pays, say, $400 to $600 a month with a painting that might be worth more in ten years. One hits the bank account. The other needs a buyer.
8. Lifestyle upgrades funded by debt that outlasts the enjoyment
Club initiations. Large renovations that do not add value. Bucket-list items financed because they feel urgent. The common thread is ongoing payments that continue after the novelty is gone.
If you already have the cash flow and can fund the experience from income already in place, enjoy it. Do not let it compete with retirement funding.
What ties the list together
Avoid purchases that create ongoing costs or destroy capital. Redirect that capital into assets where the collateral and the payment schedule are both defined.
Late starters have a shorter runway. Notes belong in this conversation because they are not flashy. There is no landlord work. You can start with a modest amount of capital. If you are brokering, you can use a funder’s money. Ongoing payments can support a retirement budget. Notes inside an IRA wrapper can improve the after-tax result.
Due diligence on a note uses the same discipline as skipping the timeshare. You underwrite. You demand a realistic yield. You have an exit if the borrower stops paying.
The first time I ran my own numbers and saw how much I still had tied up in things that produced nothing, the shift was practical, not theoretical. Moving even a portion into secured monthly payments changed the cash-flow picture more than another year of conventional saving would have done.
Where to go next
If you want the practical side of finding and evaluating notes, start with the resources at noteinvestors.com. There is also a broker opportunity if you want to begin without tying up your own capital. An upcoming Note Investing Formulas program will walk through the calculations and due diligence steps in detail.
A quiet, methodical decision is often what separates feeling behind from getting control back.
Disclaimer
This article is for educational and informational purposes only. It is not financial, investment, tax, or legal advice. I am not a licensed financial advisor. Note investing and note brokering involve risk, including possible loss of capital. Yields, cash flow, and outcomes vary by note, borrower, collateral, and market conditions. Past results and example figures are not guarantees. Always consult qualified professionals before making decisions. Nothing here is an offer to buy or sell securities or notes.
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