Clark Howard: Run away fast from that gym contract

Consumer expert Clark Howard’s column appears here each Thursday in conjunction with Deal Spotter, a weekly print section in The Atlanta Journal-Constitution.

clarkhowardIf you’re like most people, you overindulged in calories during the holidays and then made a New Year’s resolution to eat better and exercise more. Here’s a warning so you can avoid getting eaten alive by gym salespeople.

The health club industry basically has two business models. In the good one, you pay month-to-month or quarterly with no real contract. But the sleazy business model involves long-term contracts designed to give your checking account a workout.

With the sleazoids, the downfall begins when they offer you a free tour of their facilities. The tour is done by a commissioned salesperson with the intention of getting you to sign a multi-year contract.
Once you sign that contract, the gym does what’s called “moving paper.” They sell it to a finance company that will take the note on for pennies on the dollar. That creates additional incentive for the club to sign up more members — and hope none of them ever show up to work out at once.

In a recent filing for the Securities and Exchange Commission, Bally Total Fitness disclosed that the average member visits the club one-half of one time per week. You’d be hard-pressed to find any fitness expert who recommends a full workout once every two weeks!

I recommend checking out hospital-affiliated fitness centers. They’re usually rehab-based or geared toward the hospital staff. They’re clean, well run and don’t force contracts. Most will sell memberships to the public. Visit the hospital nearest you to see if a gym is available.

Another option I’ve noticed are no-frills gyms that are open 24 hours and tend to price out at around $15 each month with no contract. But beware they may not even have showers; they simply offer exercise equipment at rock-bottom prices.

-by Clark Howard, Save More, Spend Less, Avoid Rip-offs

Find more answers to your consumer questions at ClarkHoward.com. You can also listen to his radio show live Monday through Friday 1-4 p.m. on AM 750 and NOW 95.5 FM News/Talk WSB.

7 comments Add your comment

mystery poster

January 20th, 2011
11:49 am

I hate that so many things these days require contracts. Gym memberships, cellphones, Internet providers, Cable TV, natural gas providers, etc.

I could go on and on….

Making customers commit to a contract means that we can’t seek out a different provider if the customer service or product is not up to par.

@Crossfitdawg13

January 20th, 2011
11:54 am

Very glad to see this posted. There are many quality gyms that provide excellent results without requiring contracts. The CrossFit program has many local gyms that don’t require the contract.

joe

January 20th, 2011
12:02 pm

I got burned by one of those 24 hour gyms…gave $15 per month rate, but every class I was interested in taking, such as kick-boxing, wasn’t included because the instructors are “vendors” who are not affiliated with the gym and thus, charged their own outrageous additional fees. I dumped them pronto after that.

Reid in EAV

January 20th, 2011
12:36 pm

I have been very happy with the YMCA here in Atlanta. Our family has been members of the East Lake facility since 2003, where we get pool privileges as well as the usual exercise stuff: classes, machines, cardio machines, etc. It also comes with away benefits, so if I’m in Manhattan (for example) I can get into the 14th Street Y with my Metro Atlanta card.

It’s month-to-month (we pay $85/month for a family of five) but with a one-time fee when you start… or restart, if you’ve let the membership drop. A great value as long as we use it, and we do. They also offer sliding scales for lower-income families, which makes the place a great reflection of the neighborhood, both newcomers and old-timers.

q

January 20th, 2011
12:43 pm

I know, this all about fitness gyms, I like the Y. No contract, pay for the yeAR OR BY THE MONTH.
It works really well for me, I like to swim and they keep the temperature a83-85 degrees. I use every[almost] muscle in my body with no stress on the joints. In the morning I go a few miles cross country skiing. I feel great all the time. Have a personal trainer, she keeps all the muscles loose and supple. I am going to have to speak to her about the rubber gloves, it makes me feel a little I am hamburger being kneeded at the grocery store, and her fingers are beginning to feel like rubber.
Well enough of that.

mobil smith

January 20th, 2011
4:53 pm

Gym memberships are for what the individual wants out of it. I’ve belonged to Bally for close to 20 years. I would guess that 80 % of the people I observe using my club have been using it almost daily for the past 15 years. If you do not have a history of liking gym class or working out long term membership investments probably are not for you. It costs me about $ 12 a month nowadays.

Allen

January 24th, 2011
3:01 pm

Our family just discovered the wonderful county parks and recreation gym membership. I cannot believe how affordable this program is. It is also far more pleasant and enjoyable. I agree with the person who stated that any and all “extra” classes were an extra cost. What a ripoff.