Am I missing anything?

[remotelyours]

My wife just got back from WDW. We have been considering DVC for some time. We have averaged 1 to 2 trips per year over the past 6 years.

Assuming we buy the minimim $10,800 package:

Dues $544
Interest lost on $10800 at 6%, - inc tax $324
$10800/40 years $270
Total Annual Cost $1,138

Annual Cost divided by 150 points = $7.59 per point

Her 4 night stay would have cost us 56 points. So, 7.59*56 = $425.04 / 4 nights = $106.26 per night. So I save money on the room cost ($335 per night published). Is there anything else? Do I save on park passes, discounts on food, golf, rentals?

Comments would be appreciated.

 

[ripleysmom]

There are some additional discounts you get. TDS discounts and dining discounts (generally 10-20%) at some of the WDW restaurants.

Kimberly-Lucas and Ripley's Mom

 

[RobDoc]

Did your wife stay at a DVC resort? If not, the points would probably be lower for a bigger room.

There are discounts at many WDW restaurants and at TDS, PI and Water parks, but the real savings are in your room accommodations. You can also deduct property taxes paid and interest paid on a mortgage for DVC. Good Luck!

Doc
doc@wdwinfo.com

 

[Candace]

Don't forget this - even though I can't put a dollar amount to it - but you will not have to worry about getting a deal, waiting for AP or DC rates and dates. You can plan so much easier when it's your points you are spending and not worrying about rate increases at the resorts.

 

[JeffreyH]

Remotelyours,
That's very similar to how I have looked at the finances. However, in thinking about comments in the "Point Increase / Potential New DVC - Rich's Comments" thread, I came to realize that even 25 years from now, $72 per point should be a BARGIN on the resale market. I won't go over all of my thoughts (I posted them to that thread), just that with 3% annual increases prices double in about 24 years. Disney might be charging $600 per night for a hotel deluxe room (it wasn't that long ago that they were charging $150).

So the buyer in 2026 who buys 150 points for $10,800 + those higher main. fees (about $40,000 total, including interest over 16 years) pays about $2,500/year for 10 nights in a studio. I'm sure that will be a bargin at the time.

My point is that the $270 you have in your analysis only applies if you are a DVC member for 30+ years. My guess is that if you wanted to, you could get your purchase price back, have had an annual cost of even lower than you are projecting.

Given that you go to WDW so often, DVC may definitely make sense for you.

 

[kem330]

Frankly, I don't count interest lost for two reasons- 1. mentionned above about the inflation of room rates- which will more than compensate for lost interest 2. If you are going 1-2 times /year you are spending, not saving the money and wouldn't be earning interest on it anyway.

 

[JeffreyH]

Kem330,

Depends how you look at it. Remotelyours was trying to come up with an annual cost of ownership. He is trying to make a decision between joining DVC and paying for his vacations for cash each year. By having to put up $10,800 up front, the cost to you over 40 years is more than just $10,800 divided by 40. You could have invested that $, taken some out (the interest and some principal) every year for your vacation. For instance, his assumption was 6% less income tax on those earnings. He was calculating the interest he could have earned and used towards future vacations had he invested his money instead of handing it over to Disney.

However, since he is also depreciating his investment by $270/year, his interest "lost" would actually go down each year.

Using his taxable 6% (I'm assuming 4% after-tax) example, rather than invest in DVC he could put the money into that account, take out about $520/year for 41 years. Have nothing left in 2042 (just like a DVC purchaser). So, he is paying main. fees + giving up that $520 per year (some is interest, some is principal) in order to join DVC. That's about $1,000/year for the resorts that have the cheaper main. fees. About half of that amount will increase as the maintenance fees increase. So, for $1,000/year plus some inflation to that figure, he could get 10 nights in a studio. This allows him to compare paying cash now versus what the cost will be to him on average for DVC.

My point was that assuming one might want "out" of DVC 20+ years from now, I think he or she can get his original purchase price back. So, all that person is giving up is the forgone interest (about $430 per year) plus the maintenance fee. If he resold for what he paid (as anyone who purchased in 1999 or earlier can probably do now), his "cost" per year would be even less.