bostonherald.com

"Enjoy the Luxury of Fractional Ownership"

by Marcie Behman. March 1, 2006

"Last summer, a group of 13 girlfriends from California made national headlines when they decided to buy and share a $37,000 diamond necklace. Because no one woman could afford the necklace on her own, they agreed to share ownership, each taking possession and wearing the necklace for four weeks out of the year."

Behman, senior financial advisor at Merrill Lynch in Boston, looks at fractional proposals, particularly vacation home purchases, from a financial planning perspective. Benefits include: access to luxury that may otherwise not be an option, owning a bigger or better item; and outsourced, worry-free maintenance. However, unanticipated costs are a risk, and legal details should be referred to a lawyer. Financing options should be reviewed; a traditional loan may not be the best option to fund a fractional deal. Other methods could be securities-based lending or home equity and personal lending. "Fractional ownership can provide flexibility, feasibility and all the pride of full ownership without all the full-time maintenance. Further, when strategically financed, it doesn't have to deplete your cash or wreak havoc on your portfolio."