Astounding!!! SSR owners save $145,000 over moderates by buying in

[dvc-NE]

Dontcha just love saving money??!!!

Michael

Doctor P, your spreadsheet supports my wife's basic philosophy that the best way to save money is to spend money.

 

[Chuck8825]

You can also rent your points, but you will still have to pay the maintenance costs which is approx $2,000 on 500 points. This brings up a good point on rental rates though. I've noticed that the rental rates have not kept up with the increase in maintenance costs over the past few years. I am not sure why this is, but it is probably safe to assume that the net rent you currently enjoy will erode as cost increases outpace rental growth.

Getting back to the original analysis, I was trying to point out that that I would temper any expectations that a DVC purchase will lock in huge savings.

 

[TreesyB]

I'll be dead in 2054! I won't be saving the money, my DS will!

 

[Doctor P]

Getting back to the original analysis, I was trying to point out that that I would temper any expectations that a DVC purchase will lock in huge savings.

I totally agree, and as my original post said I don't think an expectation of saving money is a reason to rely on to buy into DVC--prepaying one's vacation and having more predictability in vacation costs would appear to be better reasons. The main point that I was trying to make was driven by a recent claim that one could stay at moderates every year and save money over DVC. That is not necessarily true according to the analysis based on the given assumptions.

 

[abner1776]

As an accountant for 30 years, the one thing I have learned is that 10 people can be given the same numbers and come up with 10 different answers..it all depends on your perspective and what you want the numbers to come out to.
Your example is an extreme example of the power of positive thinking...my quess it you are a DVC member or you want to be and you are trying to justify your purchase (or expected purchase) and there is nothing wrong with that.

A financial advisor armed with his HP12c will run present value and future value calculations and show you how you can do better inventing in pork bellies over the next 35 years...and maybe he will be right...but at the end of the 35 years, will you be happier having invested in pork bellies or DVC ? ... depends upon what you want.

The decision about buying into DVC should not be about whether or not you are making money or losing money...it should be about your philosphy of how you want to vacation and live your life...if you are not into the "Disney" thing, then DVC is probably not your bag. When I told my co-workers that the DW and I were going to WL for 5 days sans kids, most of them looked at me with a puzzled look and said..."why"...well, if you have to ask "why" then you don't get it.

 

[shantay1008]

As an accountant for 30 years, the one thing I have learned is that 10 people can be given the same numbers and come up with 10 different answers..it all depends on your perspective and what you want the numbers to come out to.
Your example is an extreme example of the power of positive thinking...my quess it you are a DVC member or you want to be and you are trying to justify your purchase (or expected purchase) and there is nothing wrong with that.

A financial advisor armed with his HP12c will run present value and future value calculations and show you how you can do better inventing in pork bellies over the next 35 years...and maybe he will be right...but at the end of the 35 years, will you be happier having invested in pork bellies or DVC ? ... depends upon what you want.

The decision about buying into DVC should not be about whether or not you are making money or losing money...it should be about your philosphy of how you want to vacation and live your life...if you are not into the "Disney" thing, then DVC is probably not your bag. When I told my co-workers that the DW and I were going to WL for 5 days sans kids, most of them looked at me with a puzzled look and said..."why"...well, if you have to ask "why" then you don't get it.

Well said. Oh, if only this could be the last word on this topic.

(By the way, are you a DVC member? )

 

[DisneyBaby!]

As an accountant for 30 years, the one thing I have learned is that 10 people can be given the same numbers and come up with 10 different answers..it all depends on your perspective and what you want the numbers to come out to.
Your example is an extreme example of the power of positive thinking...my quess it you are a DVC member or you want to be and you are trying to justify your purchase (or expected purchase) and there is nothing wrong with that.

A financial advisor armed with his HP12c will run present value and future value calculations and show you how you can do better inventing in pork bellies over the next 35 years...and maybe he will be right...but at the end of the 35 years, will you be happier having invested in pork bellies or DVC ? ... depends upon what you want.

The decision about buying into DVC should not be about whether or not you are making money or losing money...it should be about your philosphy of how you want to vacation and live your life...if you are not into the "Disney" thing, then DVC is probably not your bag. When I told my co-workers that the DW and I were going to WL for 5 days sans kids, most of them looked at me with a puzzled look and said..."why"...well, if you have to ask "why" then you don't get it.

Hear Hear!
As a simple Restaurant Manager, (my wife was the accouting major) I can not agree more and thank you for keeping my brain from exploding out of my head after reading some of the posts here, yours was the antidote that I needed. I wish I could talk about this on the level that many on this post are, all I know is spread the cost out over 48 years, the legnth of the contract.

And yes, people either get it or don't. I never discuss the price with people (we went in bare minimum-times are tight), becase when they do, the looks I get. But I think people are crazy for buying RV's or going camping. Bugs give me the hebe gebes.

 

[Doctor P]

As an accountant for 30 years, the one thing I have learned is that 10 people can be given the same numbers and come up with 10 different answers..it all depends on your perspective and what you want the numbers to come out to.
Your example is an extreme example of the power of positive thinking...my quess it you are a DVC member or you want to be and you are trying to justify your purchase (or expected purchase) and there is nothing wrong with that.

A financial advisor armed with his HP12c will run present value and future value calculations and show you how you can do better inventing in pork bellies over the next 35 years...and maybe he will be right...but at the end of the 35 years, will you be happier having invested in pork bellies or DVC ? ... depends upon what you want.

The decision about buying into DVC should not be about whether or not you are making money or losing money...it should be about your philosphy of how you want to vacation and live your life...if you are not into the "Disney" thing, then DVC is probably not your bag. When I told my co-workers that the DW and I were going to WL for 5 days sans kids, most of them looked at me with a puzzled look and said..."why"...well, if you have to ask "why" then you don't get it.

I have no vested interest in the calculations I did. In fact, they don't even apply to me since I don't own SSR and probably never will. Also, anyone who has been on the boards for any length of time knows that I have never advocated a financial savings or investment approach to evaluating DVC membership. However, I assure you that I have the financial and analytical credentials to do the calculations I outlined correctly. In addition, the numbers are not cooked in any way. The assertion was made on another thread that one would come out ahead if they booked at moderate class resorts every year and took the money they would have spent on buying into DVC into the bank and spending the maintenance fee expenses on their vacations instead. This analysis takes on that assertion head on, with very reasonable assumptions, and shows that that assertion is simply unlikely to be true. Now, does that argue for buying into DVC? Everyone needs to make that decision for themselves since there are so many factors involved. However, IF you are going to take a vacation to Disney every year, the numbers do work out to savings under fairly reasonable assumptions. BTW, the fallacy of having to discount the figures really does not apply in this analysis. The analysis really is comparing apples to apples the way it is set up, and the dollar savings are very real and in current dollars. I did not compound the savings in the later years, which offsets the discount argument (even though I did compound the savings for the cash paying guest until they ran out of money in their investment account).

 

[sajetto]

All I can say is hmmmmm

Maybe this will convince my DF to buy into more points than we originally agreed on

 

[greenban]

...<snip>...As an accountant for 30 years, the one thing I have learned is that 10 people can be given the same numbers and come up with 10 different answers..it all depends on your perspective and what you want the numbers to come out to. ......

Too True!

Every year Money Magazine runs a bunch of Accountant's through identical (fictional) Tax Returns. Despite being given the same dataset and the same IRS rules that we all live under, not only have no two accountant's ever got the same answer, they often vary by 100-200%!

Thus Despite having grown up on HP calculators, and not only knowing what RPN means, but understanding it....

I vote for Dr. P's analysis. In the end, in the real-world, despite having less variables (and less chance for number-creep), his results will probably be more accurate than any Accountant's!

YMMV

No Accountants were harmed in the making of this reply.

-Tony

 

[rinkwide]

Add-on versus pork bellies...
...DVC or pork bellies...
...SSR, pork bellies...

Mmmmmmmmmm, bacon.

 

[DrTomorrow]

As an accountant for 30 years, the one thing I have learned is that 10 people can be given the same numbers and come up with 10 different answers..it all depends on your perspective and what you want the numbers to come out to. [...]

{Dusting off my MBA} This is a true statement, but contributes nothing to the discussion.

Please feel free to contribute your own analysis and the assumptions on which you base it.

IMHO - YMMV

 

[mickeysgal]

Here are the assumptions: 1) Buy 150 points. 2) Go for 8 nights during the Christmas season each year. 3) 3% inflation in room rates each year; 4) 3% increase in dues each year. 5) $100 per point to buy into SSR; 6) annual dues start at 4.50 per point; 7) you can get 8% on your money by putting it aside for your vacations; 8) If you pay cash, you can use the earnings from your investment account PLUS the amount you would have spent on annual dues to pay for your vacation each year.

We did a very, very similar analysis when we were thinking of buying DVC way back when OKW was the only property available. Based on our family of 5, and our Disney vacation habit, it made sense for us to purchase. We've never regretted the purchase...well, only that we didn't buy more at the lower prices!