Silly Math Exercise

Discussion in 'Purchasing DVC' started by Jimbo, Mar 8, 2001.

  1. Jimbo

    Jimbo 6 AM and already the boy ain't right.<br><font col

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    We have been keeping a spreadsheet that records all of our point usage since we purchased in 1997. We have taken 8 trips, and have stayed mostly at OKW, with some time at BWV and VB. And we've stayed in rooms of all sizes.

    What I'd like to do is calculate how much my accommodations would have cost if I were paying cash. Then I could say to people "well, my membership cost x dollars, but I've already had y dollars worth of vacations. With 40 years to go."

    To do that, I'd need to get an idea how much these rooms would have cost. Would anybody care to give me some rough estimates so that I can do the math? We travelled entirely in May and October/November, if that matters. I also plan to add in $3000 for our DVC passes, figuring that I got the equivalent of 4 annual passes for three years.

    I don't need this to be too accurate, so any help is welcomed.
     
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  3. jimh13432

    jimh13432 Mouseketeer

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    Boardwalk and Old Key West are "roughly" in the $250 - $300 per night range. Depending on the time of year.
     
  4. PamOKW

    PamOKW <font color=green>The two most important items for

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    Sometimes I think we're crazy...but I may be able to give you some numbers. I'll try to get it together later today. It'll be rack rate. I once asked about discounts people had received and it seems like 25% would be the max.
     
  5. brittsmamabwv

    brittsmamabwv Mouseketeer

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    I do the math all the time!! I usually get my prices from WDW's website. They will give you prices based on the season, room size etc. Have Fun! I know I did when I found out how much $$$ we were saving :) I know you can also get prices from the DVC site for VB and HH.

    When you wish upon a star...DVC will take you far...anything your heart desires....will come your way
     
  6. Zimbubba

    Zimbubba Mouseketeer

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    We did this based on the rates when we bought. The value just increases from there.?
     
  7. PamOKW

    PamOKW <font color=green>The two most important items for

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    Here's a start. May is Regular Season for OKW & BWV. Oct-Nov. is Value Season

    OKW Regular Season (Rates start at 1997 and go across to 2001)

    Studio - $229, $239, $244, $254, $269
    1 Bed - $305, $315, $325, $335, $365
    2 Bed - $410, $430, $450, $485 ,$525
    GV - $845, $875, $890, $980, $1,050

    OKW Value Season

    Studio - $209, $224, $229, $234, $244
    1 Bed - $285, $295, $325, $305, $315
    2 Bed - $390, $410, $420, $435 ,$459
    GV - $825, $850, $850, $890, $955
     
  8. PamOKW

    PamOKW <font color=green>The two most important items for

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    Do you want to give me types of rooms for Vero & BWV since there are so many with Inn Garden/Ocean; Preferred & Standard for BWV? It's hard to get them to list properly here.
     
  9. WebmasterDoc

    WebmasterDoc Administrator Administrator

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    We have tracked our membership since '93- we broke even in early 98 and are waaaaay ahead now.

    Current rates at OKW for May are:
    Studio-$269
    1BR -$365
    2BR -$575
    For BWV:
    Studio-$309
    1BR -$415
    2BR -$670
    GV's are $1050 and $1440. Enjoy!

    Doc
    doc@wdwinfo.com
     
  10. dvcdudes

    dvcdudes Mouseketeer

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    Well Jimbo, you got me thinking about how much I will save and when I will break even. I did the math and if I continue at the pace I'm going. We will break even in the middle of our summer trip in 2003. We just purchased in Feb 2000. We have been on 2 trips already and have another booked for August 2001. I figured all our future trips at this years rates and did not even add tax. This is much better then I originally thought.
    The only time I ever did the math was right after our tour guides presentation of the DVC program. We received a voucher for a free lunch on the BW to "talk it over" and as soon as we sat down I grabbed one of the paper place mats and one of my DS's crayons and started my calculations. I figured it against staying in either a moderate or economy room. My calculations told me we would break even after about 6-8 years. I figured this would give us roughly 35 years of vacations for dues alone. I was sold!
    After scowering the DVC book and doing all sorts of point usage scenarios, I came up with an ideal situation where we could go on two trips a year, maximizing our point usage. I can't get enough.
    Of course I am now comparing apples to apples and I am not figuring any "lost interest" but I feel more comfortable with my decision then I ever did, especially after my first stay at our home resort (BWV). I now know buying DVC was one of the best things I have ever done.
    :D :D :D :D

    DVCDUDES
    Owner BWV Feb 2000

     
  11. Jimbo

    Jimbo 6 AM and already the boy ain't right.<br><font col

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    Pam and Doc - That's exactly what I was looking for, and much more than I was hoping for! If anyone had numbers for a VB studio and a BC, it would all be complete. Tonight I'll plug it all in, and I'll be ready the next time someone tells me that we made a bad decision.

    Thanks again!
     
  12. Jimbo

    Jimbo 6 AM and already the boy ain't right.<br><font col

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    Why are there two different prices for BWV GVs?
     
  13. PamOKW

    PamOKW <font color=green>The two most important items for

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    Vero
    1997 Regular Season 4/20-5/31
    1997 Value Season 6/1-12/18

    1998 Regular Season 4/9-6/11
    1998 Value Season 8/16-10/31 & 11/1-12/31

    1999 Regular 4/25-6/5
    1999 Value 8/22-12/25

    2000 Regular 4/30-6/3
    2000 Value 8/12-12/21

    Regular Inn Ocean or a Studio (Rates are 1997-2000)
    $200, $210, $215, $220

    Regular 1 Bedroom
    $250, $260, $270, $275

    Regular 2 Bedroom
    $305, $215, $335, $365

    Regular Villa
    $615, $635, $665, $715

    Value Inn Ocean or a Studio
    $180, $160, $160, $165

    Value 1 Bedroom
    $210, $210, $220, $230

    Value 2 Bedroom
    $260, $260, $290, $300

    Value Villa
    $580, $590, $610, $650
     
  14. KNWVIKING

    KNWVIKING DIS Veteran

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    Jimbo,you can go right to DVC web page,they list all the resort rates as if you were a non-dvc member.Scarey what a Grand Villa cost per nite at Christmas.
     
  15. PamOKW

    PamOKW <font color=green>The two most important items for

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    I'll just give you Boardwalk Preferred View since they've eliminated view choice for Disney hotel guests.

    I've got 1999 through 2001 which is little different than the others.

    Studio in Regular Season
    $284, $294, $309

    1Bed in Regular
    $385, $395, $415

    2 Bed in Regular
    $550, $620, $670

    GV In Regular
    $1,250, $1,375, $1,440

    Studio in Value
    $264, $269, $279

    1 Bed in Value
    $355, $365, $375

    2 Bed in Value
    $480, $495, $520

    GV In Value
    $1,150, $1,210, $1,275
     
  16. PamOKW

    PamOKW <font color=green>The two most important items for

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    Aargh!!! Why do posts keep disappearing and reappearing!!!
     
  17. BobH

    BobH DIS Veteran

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    I enjoy the method posted by another board member:
    Mantenance 720 x 41hrs = $29520
    29520 + $14880 (orig. cost)= $44,400
    $44,400/41 years = $1082.93 per year

    This is for my 240 point contract.
    At $250 per night this would get me 4 nights and
    I am getting a lot more than that out of it. I have the potential for 21 days in a studio at Adventure Season. Forget the opportunity cost and the maintenance increases! I am having way too much fun going myself and also sending my older children.
     
  18. WebmasterDoc

    WebmasterDoc Administrator Administrator

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    <BLOCKQUOTE><font size="-1">quote:</font><HR>Why are there two different prices for BWV GVs? [/quote]

    My fault! The $1050 is for OKW and the $1440 is BWV. Sorry for the confusion.

    Doc
    doc@wdwinfo.com
     
  19. Jimbo

    Jimbo 6 AM and already the boy ain't right.<br><font col

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    Well, I'm already ahead of the game. I took a 20% discount off of the rack rate for all my stays, added 11% tax, and added $3000 for the value of my three years of DVC passes. When I compare that amount to what I paid for my contracts, plus what I've paid in dues, I'm about $1200 ahead. The next 40 years are pure gravy!

    Many thanks to those that helped, especially since you had to battle the boards to do it.
     
  20. PamOKW

    PamOKW <font color=green>The two most important items for

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    Now....let's take that $1,200 and buy some more points!! ;)
     
  21. Aaron42

    Aaron42 Earning My Ears

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    Quote from BobH:

    ---------------------------------------
    Maintenance 720 x 41yrs = $29520
    29520 + $14880 (orig. cost)= $44,400
    $44,400/41 years = $1082.93 per year

    ---------------------------------------

    I see only one problem with this logic - the true cost of DVC as calculated here doesn't take into account the interest lost by locking up $15,000 for 41 years.

    If one were to take that money and invest it, even in a moderate-earning mutual fund compounded at 8% per year, after 41 years that $14,880 would be worth:

    (14,880)(1.08)e+41 = $349,121.75 !!!

    So, the true cost of DVC would be:

    29520 (maintenance fees)
    + 14880 (initial investment)
    +349121 (interest lost by tying up capital)
    ----------
    = $393,521

    This works out to $9598 per year over 41 years.
    Even this doesn't take into account the interest lost by not investing the maintenance fees.

    If our investment goals were a bit more optimistic, say at 12% per year earned in the stock market, our interest lost over 41 years would be $1.55 million dollars, coming to a grand total of $38,906 paid per year of DVC.

    This is assuming our investment would be compounded only annually - if it was semi-annually, or monthly, the numbers would be even higher.

    If one were to simply pay the rack rate per year (which of course nobody does) and invest the difference in our RSPs, versus DVC, which one really comes out on top?

    dvcdudes addresses this issue earlier in the thread, stating that the "only time I ever did the math was right after our tour guides presentation", and that he was "not figuring any 'lost interest'", but this is the most important point.

    It really is important to do this "silly math exercise" - even at the rack rates, I couldn't see myself spending over $1.5 million on Disney hotels over the next 4 decades.
     

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