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Muskoka chairs on a Lake Muskoka cottage dock. (Fred Lum/Fred Lum/THE GLOBE AND MAIL)
Muskoka chairs on a Lake Muskoka cottage dock. (Fred Lum/Fred Lum/THE GLOBE AND MAIL)

Real estate

Four reasons to sell your cottage now Add to ...

I know this won't help the cottage real estate market. I apologize in advance. But for the life of me, I don't know why so many people buy cottages.

The more clients I talk to, the more I hear people complaining about the upkeep and the cost, the family squabbles and estate tax issues. There must be a better way.

Cottage owners and potential cottage owners - I know that you won't agree, but here is some food for thought:

1. Avoid all the work by renting a cottage for two or three weeks. The sump pump is broken, a window needs replacing, the deck needs new wood in a few places, there was a leak last winter ... and you just discovered it in the spring: The list of work associated with owning a cottage is pretty long. And then there are the property taxes and upkeep costs. You start to feel like you have to be at the cottage a lot to justify the amount of work and expense. If you rent a cottage, no fixing, few worries.

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2. By renting, you can easily get the right cottage each summer for your stage of life. The right cottage for a young family is not the right cottage for a family with teenagers or for a retired couple. Imagine being able to change cottages every few years without the hassle of fixing it up, putting it on the market, paying real estate fees, finding a new cottage, worrying about financing, etc.

3. Feel free to see the rest of the country or the rest of the world during the summer. Given all of the work and dollars that go into a cottage, you want to get the most out of it. What if you weren't tied to the cottage? You could take a summer vacation anywhere. You could rent a cottage anywhere. You could even stay in the city more and enjoy the festivals and celebrations that go on almost every week.

4. Finally, no more freeloading friends and family to worry about. While this may sound funny, any cottage owner knows that inviting family and friends is a wonderful idea, but can often be taken advantage of. You can still invite people up to a rented cottage, but it no longer becomes someone else's annual vacation destination.

I haven't even touched on the estate planning problems (which can be somewhat alleviated through insurance) that can tear families apart. I am not suggesting that selling the cottage is the right decision for everyone, but when you look at the list above, it certainly makes you think.

If you are reading this at your cottage right now, don't forget to turn off the water and adjust the thermostat before you leave.

Ted Rechtshaffen's Adviser Secrets series:

  • Part 6: Do you want to protect your lender or your family?
  • Part 7: You can be too rich
  • Part 8: Your company pension plan: Demand a great deal
  • Part 9: How taxes affect your financial health
  • Part 10: How much can you afford to give?

Ted Rechtshaffen is president and CEO of TriDelta Financial Partners, a firm that provides independent financial planning advice. He was vice-president of business strategy at a major Canadian brokerage firm and found that the interests of the client were often not aligned with the interests of the adviser or the interests of the company.

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