PLEASE Convince Me DVC is Worthwhile!

[rillsung]

We were very excited when we started looking at joining and wanted the numbers to work so that we could justify it. The numbers just don't work for us.

Staying at the All-Star for almost 3 weeks over the holidays this year, will cost approximately $2,500.

We were looking at Boardwalk because it was cheaper via resale. We came up with 277 points for the same time frame which would be (resale price ~$83/point) $22,991 upfront or financed. Also the annual dues at $4.71/point is $1305 per year.

Assuming no discounts or other benifits, since Disney can take those away at any time;
Assuming these figures don't go up like they will;
Also assuming that we don't finance the initial $22,991:

$22,991/($2500-1304) = 19 years to break even, much longer if you finance and pay interest.

After 19 years, it would be cheaper, yes. But we would still be paying the $1304 annual rate or whatever it has increased to by then. It's just more worth it for us to pay off some of our debt right now. If we pay off our second mortgage, we then have $300 extra per month in a vacation account that would buy a very nice no strings attached Villa at the end of the year. You can say this vacation is free! The same is true if you pay off a car loan or student loan or credit card or whatever. When we pay off our second mortgage, we actually own a significant part of our lives (And we get this money back when we sell it later). After 50 years in the Vacation Club, you are left with nothing. So you're actually just renting the magic...

So where am I wrong?

 

[WALTSAGOD]

Look at how much the rack rate for BWV is.

If you're fine at the value hotels, DVC is not for you. You can't compare the two, amenity or cost wise.

As adults with a 4 year old, our first couple of trips were at the ALL STAR and they were GREAT trips and good rooms. Our son LOVED the football field.

We were fine at the values but wanted to try a moderate so we stayed at POR, and the difference was night and day. Way less hustle and bustle and overall we seemed to have more in common with those who stayed at POR.

We'll never go back to a value. Once you've tasted fresh bread its hard to eat stale, LOL!

Anyway, after just climbing out from under a ROCK, we heard about this DVC stuff; on a Disney cruise of all places and are now researching not if, but what resort to buy.

You mentioned BWV due to the resale cost, you should look at OKW also.

There is a lot of great info and people here. Doc is very quick to jump in and get you pointed in the right direction.

 

[WALTSAGOD]

After 50 years in the Vacation Club, you are left with nothing. So you're actually just renting the magic...

So where am I wrong?

After 3 weeks at the ALL STAR you are left with nothing also.

Vacations are an investment in your health and family. They are a terrible financial investment.

 

[Califgirl]

We were very excited when we started looking at joining and wanted the numbers to work so that we could justify it. The numbers just don't work for us.

Staying at the All-Star for almost 3 weeks over the holidays this year, will cost approximately $2,500.

We were looking at Boardwalk because it was cheaper via resale. We came up with 277 points for the same time frame which would be (resale price ~$83/point) $22,991 upfront or financed. Also the annual dues at $4.71/point is $1305 per year.

Assuming no discounts or other benifits, since Disney can take those away at any time;
Assuming these figures don't go up like they will;
Also assuming that we don't finance the initial $22,991:

$22,991/($2500-1304) = 19 years to break even, much longer if you finance and pay interest.


So where am I wrong?

IMHO, Comparing All-Star to a DVC unit is where you are wrong. It's like comparing a Motel 6 to a Fairmont Hotel.
With DVC you also have the flexibility to change the size of your unit whenever needed.

There are lots of pluses to owning DVC, but first and foremost it must meet the needs of YOUR vacations. If you are content vacationing at All Stars for 3 weeks each year, then it sounds like that works for you. Your vacation style is what is ultimately important.

I'm not even going to touch the math comparasions. The math made sense for us to buy, but we vacation differently from you and we own 2 other timeshares, so we are familiar with the system and understand how it works. One of the resident math wiz'es can probably crunch the numbers until they come up with a totally different out come!

 

[rillsung]

I should mention that we also chose Boardwalk for the location - ease of walking to Epcot and Disney's Hollywood Studios.

Yes, I compared the All-Star price to the DVC since it's the cheapest place to stay. We realize that the rooms are of no comparison. My point really is that if we use the $22k towards paying off, and owning outright, our home, then we have the budgeted monthly cost of $300 to put in a separate vacation account. So $4000/year would get us a room at the Boardwalk FOR FREE! Then if you add the currently budgeted $2500 that's $6500 for our vacation. That's a big investment each year in our health and happiness 8

 

[rillsung]

After 3 weeks at the ALL STAR you are left with nothing also.

Vacations are an investment in your health and family. They are a terrible financial investment.

But we own our home...

 

[rillsung]

With DVC you also have the flexibility to change the size of your unit whenever needed.

But it doesn't seem so flexible to us. You have to worry about banking or renting or buying more points to change the size of the villa. Just having $6500 outright seems much more flexible. What if there is a major tragedy? You can't use points to pay for the tragedy, but you can use the $6500...

 

[WALTSAGOD]

You sound as if your mind is already made up.

The values are a nice may to spend a vacation, and you'll feel better inside.

Have fun!

 

[DVC Mike]

Staying at the All-Star for almost 3 weeks over the holidays this year, will cost approximately $2,500.

From a purely financial standpoint, someone who is happy staying at a Value resort or staying offsite should not consider becoming a DVC Member. DVC makes the most sense to those that typically stay in a Deluxe resort.

 

[Lynne M]

DVC is about pre-paying for deluxe accommodations. It's not about getting a bargain WDW vacation, and it's not a discount program. If you're looking for a way to stay that's comparable to or cheaper than the values, DVC is definitely not the answer.

Sure, if you're used to paying for deluxes, DVC will probably save you money.

But it's most certainly NOT the cheapest way to stay in WDW resorts. If you're feeling cramped at the values, need more room for your family, want the kitchen/laundry facilities, or are looking to move up to more deluxe accommodations, then DVC can be a good value and can save money in the long run. But if you're happy at Pop and the All-Stars, you're not going to find any savings in DVC.

 

[dianeschlicht]

I agree. If you are happy with the value resorts, DVC might not make sense for you at this time. YOu have to think of it as pre-paying for deluxe accommodations in the future at today's prices. If you aren't used to the $5000 per trip costs of a deluxe, then DVC might not make sense for you. For those of us who preferred the deluxes, it makes great sense and is a great savings. We purchased 11 years ago, and consider it to be one of the best purchases we have ever made in our 39 years of marriage!

 

[crisi]

Bad deal for you. Buying DVC should never be made as a simple financial decision. There are always more responsible things to do with your money than buy a timeshare. There are always cheaper ways to vacation than DVC.

In addition to the Deluxe resort criteria, DVC also only works as a budget helper if:

You don't mind not having housekeeping every day.
You don't mind not having two beds in a studio (or will be staying at OKW).
You don't chnage your vacation habits - a lot of DVCers go more often, bring guests - even ones that were well intentioned when they bought on saving.

 

[nicki's mom]

I don't think you should buy in, given the mindset you're describing.

Nothing wrong with the values. We wouldn't do it, but that's the point, really. DVC is not for everyone.

 

[WolfpackFan]

So where am I wrong?

You're not wrong. If you are content staying in All-Stars then there is no way you can justify joining DVC. On the other hand, we stayed in an All-Star back in January for the first time in years after joining DVC and I would never do it again. You get used to certain amenities at the Deluxe resorts and it is very had to go back.

 

[kapeman]

Vacations are an investment in your health and family. They are a terrible financial investment.

But vacations are still a LOT cheaper than an extended stay in the hospital or years of therapy!!!

 

[marynvince]

probably is an option you should consider. Typically points sell for $10 per. With your 277 point example, you could have stayed at Boardwalk for $2,770 vs $2,500 for All Star. For only $270 you could trade up.
Good Luck

 

[Buckeye Fan]

So where am I wrong?

As others have stated, you're not wrong comparing to values. What I will say is that our vacation habits have totally changed since purchasing DVC. We used to go to WDW for a few days, stay at the value resorts and run like CRAZY!!! In all honesty, the room didn't matter. We were never in it anyway. Now, we enjoy so many other things WDW has to offer aside from the parks.

Bottom line, with so many unknown variables (time value of money, interest rates, financing vs not financing, what rack rates will be in the future, etc.), it's like looking into a crystal ball. I would never buy DVC as an investment. It is a pre-payment of vacations. Paying off your home could be a better investment, depending on your interest rate. That's where the crystal ball comes in! IF rack rates increase they way they have been, and the interest rate on your home is low enough, over time, pre-paying your vacations and getting your home on a low 10 - 15 year fixed may end up giving you a slight advantage.

If it makes you feel any better, I crunched numbers and options until I was blue in the face. I could make them look good or bad, depending on the variables. At the end of the day, it came down to an emotional decision. Was our heart in it or not and did we want to regularly visit Disney? For us, it's been a good investment. We love our DVC vacations!

 

[Buckeye Fan]

probably is an option you should consider. Typically points sell for $10 per. With your 277 point example, you could have stayed at Boardwalk for $2,770 vs $2,500 for All Star. For only $270 you could trade up.
Good Luck

Excellent suggestion. If you haven't stayed at a DVC resort, you can try it out for about the same cost and see what you think. The studios at OKW are the best bang for the buck since they have 2 queen size beds (other resorts are a queen and sleeper sofa). Also, rent a 1-BR one time. Since there are 4 of us (DH, DS-12, DD-5 and me), I like having a living room separate from the bedroom and the washer and dryer is WONDERFUL.

If this gives you any idea, we just went for spring break. It was holiday season and for a 2-BR, we used 320 points at SSR. We had 1 king, 2 queens and a sleeper sofa. Had we paid rack rates, we would have paid $875 per night for 6 nights, plus 12.5% tax = $5,906. If you rented at $10 a point, you could go for $3,200.

 

[Caskbill]

There's a couple of things you're missing.

1. $300/month is $3600 annually, not $4000

2. Assuming that some of that $3600 is interest that you're deducting off your income tax. You'll lose that deduction so your net savings will be less than $3600. If 50% of your $300 payment is toward interest, and you're in about a 25% bracket, then your taxes go up $450 so your net savings is 3600-450 = $3150, not $4000.

3. Inflation will have a bigger increase on the larger dollar amount. If inflation averages 3%/year, then in 19 years your DVC-dues would go up to $2287/year, but your $2500 value resort goes up to $4384, so the difference that year is almost $2100 compared to the $1200 difference today. Think of it this way. You get a 3% raise. Your boss gets a 3% raise. Who got more money? Or in terms of a value resort versus DVC, which had more of an increase in actual dollars.

4. But don't forget your other differences. If you finance DVC then you have interest charges there (but they could be claimed on your income tax as a deduction. Also part of your dues is property taxes, which also can be claimed as a deduction on your income taxes.

5. On the other side of the coin, if you do finance you are spending more money than just the 'buy-in' amount. (you're paying interest). If you don't finance but use money you currently have, you are losing the value that money could be earning as an investment. (I.E., you need to calculate the Time-Value of money)

6. Your comparison was for Boardwalk (did you use Standard Views or Preferred Views?). If you compared to SSR, to OKW, or even AKV which all have lower point 'costs', this will affect your total 'analysis'. A value room at AKV is approximately 70% of the points as a room at Boardwalk. That would mean a purchase of about 194 points instead of buying 277. This will change your analysis considerably. And a 'value' room at AKV is still a huge upgrade from staying at one of the All-Stars.

 

[Coach81]

I should mention that we also chose Boardwalk for the location - ease of walking to Epcot and Disney's Hollywood Studios.

Yes, I compared the All-Star price to the DVC since it's the cheapest place to stay. We realize that the rooms are of no comparison. My point really is that if we use the $22k towards paying off, and owning outright, our home, then we have the budgeted monthly cost of $300 to put in a separate vacation account. So $4000/year would get us a room at the Boardwalk FOR FREE! Then if you add the currently budgeted $2500 that's $6500 for our vacation. That's a big investment each year in our health and happiness 8

Sounds like your mind is already made up and you seem to have a good understanding of what you want. Grats to you!
We love our DVC Membership, and we are very happy with our decision!

Good luck to you and your family, I hope will all have many more great vacations and build many more priceless memories!