Seeking the weight of authority....

[ricapito]

I'm a relative newbie, seeking clarity, advice, and perspective from what appears to be a thougtful and educated group of people. I'm the least likely person to divulge my personal situation to an unknown group of people, but this seems to be a stellar group to take a chance with, and there is no way you can provide the valuable insight I seek on what is a qualitative decision more than a quantitative one, without giving up some details.

In sum, Disney has just complicated my life with the upcoming SSR price bump to $95. I can buy in at $84 through April 3, buy a resale, or do nothing.

I'm 32, married, with 3 young children and a fourth on the way. I'm "that person" who was profoundly impacted by the tech implosion. Though I had an MBA and some great buusiness success, my career was being butchered after each successive layoff, and there were decidedly fewer opportunities for 30 year old Director/VP's when people in their forties were willing to work for the same amount. I sold my house, quit my job, and moved to DC to attend George Washington Law.

I work full time, attend school 4 nights a week, and study every other free minute. I did my MBA at night and can chalk that up as 3 years I already missed of my kids lives. I'm unfortunately working on 4 more missed years as we speak. I'm confident the long-term career stability I crave will be more attainable as an attorney. I expect a lifetime of hard work ahead to pay off GW. Please refrain from rendering value judgments on my time away from my family, and hold back if you will on the "take a different career path" advice. These are not decisions for discussion here.

Disney has been my sole outlet, every other year, to spend truly unqualified time with my family. I don't need to tell this group about how important time at WDW is, and that's why I'm here, you are all part of the cult, and the only potential "advisors" available that share my enthusiasm.

I don't view DVC as an investment, and actually find the different attempts at financial justification amusing because to make this into a purely financial decision would mean no one would buy! But I'm truly faced with tough decision that needs to be made; At what point do you say Disney comes first? At what point do you say my time at Disney is more important?

Financially, I certainly don't have much job stability today... But I have had no job stability for 3 years now, so to "not buy" because of financial uncertainty would mean to certainly not buy at all, ever. Perhaps that is wise, and if so voice your opinion. I have some savings and an equity line available on my home. I like to keep 4-6 months living expenses "liquid" in case of unexpected (or expected) unemployment. I currently earn enough to pay my bills, but not much more, as I needed to down-size my career while in school.

I want to buy into DVC because I feel I can never get this time back, and there will never be a good time to buy. I also feel my prospects long-term are good despite some uncertainty in the short-term. I've boiled a "buy" decision down to two options. Buy a resale for 75 points at VWL or BCV and go every other year for 4 nights off-peak, or buy SSR 150 points today and "do it right" very other year or off-peak every year.

The Arguments:

The principal argument to not buy is that I have little financial or job stability. Then: I can always find a cheap hotel off-site for far less than Disney. I have no monthly obligation or real estate risk. Who knows how much I'll make post-graduation or if I'll even be able to make my mountainous student loan payments. Money spent on this might be money I'd need to get by if unemployed longer-term than I've budgeted for.

The argument to buy, for either option proffered- SSR or VWL resale- is that I can't ever get the time back while my kids are young and I'm never happier than when at Disney. This forces me to make the time for them, and myself frankly. This is something I can hand-down to them as well. Also, since I need a 2BR villa, this makes sense more than off-site, or at least makes the cost comparison very different than against single rooms either on-site or off as few places can accomodate 4 kids and two adults comfortably. A substantial part of me feels there is no substitute for being on-site, period. Finally, I can always sell the realty interest in a worst case scenario, as the market for resale seems fairly liquid.

Specifically:

If I choose a 75 point resale I can afford to not finance anything, and pay cash, though it will not be discretionary savings to be sure. But I'm tired of being at WDW off-peak, which this will require, and this option is short 12 additional years over SSR. But I could always buy another 75+ points at SSR later via resale (can I ???) if I decide to start going every year or to "go in style during best times." This is the safest "buy now" decision, and if SSR weren't being bumped to $95 it would carry more weight than it may now.

The argument for SSR is "buy now before it's 3 years from now and $115 a point or more"... but on the other hand its more than double the outlay and monthly dues obligation, and would require some financing. After viewing the amortization schedule I cringe at the thought of 9.75%. But, I suspect it will be a more liquid investment and hold its value better over the long-term, in the event of an emergency sell-off. And again, despite the cost, Finally, I'll never be sitting down at WDW wishing I was there at a different time of year, more often, or in nicer accomodations as I have done on all prior trips. This will elevate WDW to it's proper position in my life despite some financial hardship.

So there you have it, don't buy, buy- and if so which choice. This is obviously as much a qualitative decision as a quantitative one. My logic may not be as clear here in writing as it is to me. I'm not expecting anyone to make a decision for me, and don't cop out by saying this "is ultimatley up to me" as I know that. This is about getting some alternate perspectives and opinions. Perhaps writing all these thoughts down was just the trick to help me make this decision.

Thanks for the bandwidth. If you'f like to send a private response feel free, bricapito@law.gwu.edu

Regards,
Bryan

 

[bobbiwoz]

Hi Bryan,

You are just a bit older than our oldest son. I want to know what your DW's opinion is, or is this meant to be a "surprise?" I would not recommend a "surprise" of this magnitude.


Bobbi

 

[floridafam]

I wouldn't do it. Sorry. This is just my opinion.

If you do, I would do 150 at SSR. You have to figure in the closing costs for a small resale. I think it makes more sense just to do SSR. You get more years and you can finance with Disney as long as you are approved. They have different terms available depending on how many years you finance.

You sound like you will get tired of going off peak so do the SSR.

Good luck with your decision!

 

[SSRex]

At 32, you may still have many years left to enjoy WDW & DVC when the resale would be ending. SSR would take you into your mid-seventies.

With 4 kids, you will want and need the 2 bedroom and 75 points won't get much even with banking and borrowing three years of points together.

I am also facing the potential of a job change later this year or early in 2005, but I regret not buying in 1998 at Hilton Head and did not want to miss maybe my last opportunity to join into DVC.

It won't get any cheaper than it is now, but only you know what you can afford and how that will effect you and your family also.
Best of luck deciding,

Rex

 

[Happy Birthday Cat]

You sound like you will go to WDW regardless of whether you purchase DVC or not. Since you have four children (like me) you will need two rooms. That gets expensive. Believe me I know how expensive that can be. You also have excellent earnings potential and have the right idea about time with your family. So to make a long story short, I would buy SSR now. Normally I tell people to wait and make sure they are financially okay to make the commitment, but I think you have the right idea of what DVC is and what it is not. Someday when you are working for a big D.C. law firm you can add on another 2000 points.

HBC

 

[jarestel]

In today's economy, I think many of us are in your position as far as job security goes. Seems like too many businesses try to manage quarter to quarter rather than long term and this creates a lot of instability and uncertainty in the workplace. Having said that, I would go for SSR and finance the max term ( 10 years I think ) through Disney. This gives you a very small monthly payment that you can always pay off early when finances improve. I agree that time spent with family in a memorable place is worth far more than the money it costs. If you think you can make it work, I'd vote yes.

 

[RumpleMom]

Bryan

I'm sure others will post after me about the financial aspects of DVC, but I'm speaking from a parent and teacher perspective. Previous to DVC, we went to WDW several times at 3 year intervals when the kids were little staying at the All-Stars, never taking them out of school, so June, July or August. The in-between years we went to the amusement and water park within a day's drive from home. It certainly was not WDW, but we stayed a few days and had wonderful fun as a family. It certainly was less expensive. As each child was born we started a savings account for their college tuition, and have paid for the many ballet and taekwondo lessons and of course, they both needed orthodontics. We didn't buy in until they were teenagers and DVC would not be a financial burden. We didn't need any more financial stress during those years.

Anyway, my point for sharing all of this is that you are making memories with your beautiful family each and every day whether you go to WDW or not. If DVC adds 51 weeks of financial stress, then perhaps now is not the time to buy. My advice to my DD22, who would buy DVC in a minute, but is just graduating from college and has no money, is WDW will be there when she has all of her financial obligations met - car, house, her future kid's education. Best wishes for what ever you decide.

 

[zulaya]

I just wanted to say you have really thought out your options very carefully, and weighed every aspect of your situation. Good for you.

I think in your position I would have a heck of a tough time deciding. All your arguments for buying/not buying totally make sense to the practical person in me and the person who values family time above everything.

If it were me and I had to make this decision, I would buy now. You sound like you are going to do to WDW regardless of buying into DVC or not. Buying sooner than later will be a better deal in the long term.

I also would buy more than 75 points wherever you decide to buy. Being that you need a 2 bedroom, and that eventually you want to travel at more regular times, you need the extra points to give yourself that flexibility.

Best of luck in your decision.

 

[chips]

My first reaction is don't do it. Having said that I would consider other options. If your main concern is immediate villa. Renting a point for 10 is only 6 dollars more per point.than m.f. If you can find distressed points that are expiring you could probably do better. Ideally dvc is best purchased when things are flush.

People have bought contracts with 2003 points, 2004 points and some banked points off site HH and vb for low 60's. However these are usually 200 points and up. It is my sense you can book times other than October, early nov, and early december inside the 7 month window. You could strip(rent) two years of points for 10 and borrow the 2005 for your vacation in 2004 use year.

200 point contract bought for 12,400. rent two years for 2400 (after maintenace)net 10000. You would own a 200 pt contract for 10000. However you are owing m.f. for 800 plus each year.

The 75 point contract will be expensive resale. Closing would be 5 dollars a point. Contracts are popular and are not heavily discounted.


First option :don't do it. Second option buy loaded discount off site contract and strip it. Borrow for your vacation and it is almost 3 years of a 75.

 

[LoveToDisney]

IMHO don't purchase. You can still have great Disney vacations staying OFFSITE in suites (for extra space) and doing a lot of shopping around and planning at least a year ahead of time. Once you are settled and your debt is managed, then enjoy the fruit of your labor with a purchase of DVC (if you still want to). Your additional income will more than make up for the increase in points price.

If you are top in your class in law school, then forget everything I've said and go for it! If you are not at the top, then remember that just going to law school doesn't automatically mean you will be able to get the best paying jobs...it's very competitve even after law school.

Most of all, make sure both you and your spouse agree completely on the decision.

 

[SleepyatDVC]

Tough decision Byran.

Sounds like you put a lot of thought into it. I totally admire that.

I totally understand and agree with all your points.

From reading about your admirable fiscal responsibility, if I were you, (and am not), I'm not sure I would buy right now even with the price increase looming.

Life is short, yes. But with financial worries, debt etc. looming over a person, each day can seem extremely long...

That said, here's some additional thoughts:

When is your next trip? If you just got back, then you have almost 2 years to wait fo the trip. I would save up for a resale later on.

I would wait to see where the resales go in the future. Will ROFR increase or decrease for DVCI and DVCII. If I were to buy now with the slim possibility of having to sell in the future, I would seriously consider SSR. Logically, Disney will be more likely to keep the floor price of DVCII ROFR higher since they will still be selling it themselves.

Are you affording the Disney accommodations comfortably now? Instead of asking if you will be saving money buying DVC, will you be spending substantially MORE money by staying at more deluxe accommodations at DVC at times that are not as convenient as you would otherwise?

If you can "rough it" at Disney for the next few years, you can still buy DVCII at a higher price or even a larger DVCI resale contract in a few years when you are more financially stable.

Another thought, if you do buy DVC now, you may be locked into only Disney vacations for the next few years. If you have any thoughts of a cruise or any type of non-Disney vacation, you won't be able to do any of that until you are financially secure because you would have prepaid all your vacation $$ to Disney with none to spare elsewhere.

If you do think that DVC is right for you now, I would lean towards SSR right now, due to your age (young), easier to finance with prepayble, manageable monthly payments, and better chance of a higher ROFR floor.

Of course, if you don't mind the work of renting out points, I might consider waiting for a fat resale with banked points at the right price (I would wait to see where resale prices stabilize at) and renting enough to cover some of the maintenance costs.

Those or just some of MY thoughts.

Good luck with your decision.

 

[Granny]

Wow.

This is one of the most well thought out and articulated "newbie" questions I've ever seen in the four years I've been reading and posting on these boards.

What a tough, tough decision.

For too long, I had a "save for a rainy day, save for retirement, etc" kind of attitude that was instilled in me by my father who lived through the Great Depression.

I didn't take my children to WDW until they were 9 & 7 years old. I didn't buy into DVC until they were 12 & 10.

I have often wished that I bought into DVC sooner, not because of the better financial deal, but because it would have "forced" me to have wonderful vacations with my family so much sooner.

I firmly don't believe in leveraging a lifestyle today that will mean financial ruin in the future. But I do believe that if you can somehow swing it without sacrificing other essentials in your life, that you should seriously consider the SSR purchase.

I don't know where you stay now at WDW or how much you are paying, but the nice thing is that you can purchase the DVC contract and if things get really financially tight in a couple of years, you can sell it for nearly what you bought it for and you would be out the annual dues only (which probably is less than you would spend with cash reservations at WDW resorts).

It is a tough decision, and I won't wimp out by saying that only you (and your wife) can make it. You can certainly have quality vacation time with your children without buying DVC, but if WDW means that much to your family, you might want to give DVC a try.

Good luck to you and your family!

 

[ricapito]

Thanks for the great thoughtful responses and emails. I am actually quite frugal otherwise, I have no car payments or credit card debt, to answer someones question! And indeed, I have already proven that employment instability has little impact on whether I will go or not as I have actually gone while between jobs, and once when I was about to lose a job. Perhaps this is telling.

I also don't have the time in my life to do as "chips" would do, though it makes sense. The effort alone to manage it is not feasible, despite how minimal it might be.

As for my wife, she too is struggling with this decision and is not in the dark. But the comment about adding 51 weeks of stress for a weeks vacation puts me right back on the fence!!!

Argh

 

[OneMoreTry]

I have a principle for myself on discretionary spending: "You can never go wrong by not buying something."

If I have concerns about buying something and buy it anyway, I regret the purchase more than half the time.

If you stretch yourself too much, the stress will be more than a Disney vacation can compensate for.

Go to disney. Enjoy. Stay at a moderate. With the mousesaver deals you can get 2 rooms there for $180 per night (before tax) -- or less for the DTD rooms. When the time is ready for DVC you and your wife will know and be certain.

I love DVC. But waited for 10 years until the time was right.

In summary: "Be certain."

 

[LoveToDisney]

Originally posted by OneMoreTry
I have a principle for myself on discretionary spending: "You can never go wrong by not buying something."

If I have concerns about buying something and buy it anyway, I regret the purchase more than half the time.

If you stretch yourself too much, the stress will be more than a Disney vacation can compensate for.

Go to disney. Enjoy. Stay at a moderate. With the mousesaver deals you can get 2 rooms there for $180 per night (before tax) -- or less for the DTD rooms. When the time is ready for DVC you and your wife will know and be certain.

I love DVC. But waited for 10 years until the time was right.

In summary: "Be certain."

Couldn't have said it better. Thanks OneMoreTry.

 

[Pa@okw95]

You are not in a financail position to buy into DVC. If you go to WDW with your family there are many off site spots with great condo units with 3 bedrooms. They are less expensive then you may think. At any rate I would not get into DVC if I were you.

 

[Mic]

I am not one to give financial advice by any means, but since you are asking for opinions, I'll offer mine. We had 4 children in 5 years(yes, that takes some serious UNplanning), and we were only in our mid-twenties when #4 came along. When our youngest was 4 years old, my FIL passed away suddenly, before retiring and enjoying the fruits of his labor. I realized then that none of us knows what will happen tomorrow, and I didn't want my kids to be left saying "I wish we had..." after I was gone. Our fondest memories of grandpa were the few mini-vacations we managed to take that coincided with my oldest daughters' out-of-state dance competitions, and I was determined my kids would have more than a few memories of us vacationing as a family. It took exactly one year for me to save the money for our family's first Disney vacation, and I was sorry I had not done it sooner. It took another year to convince my husband we needed DVC, but I was not able to buy as many points as I had wanted. Hubby agreed to the minimum(150 points) at BWV, and we financed them(some would argue against this). Through add-ons(the most recent 2 days ago), we are now up to 450 points, and I am definitely stopping for a while...oldest daughter will be 16 in 2 months, and she wants a NEW car! (Note to parents of younger children...the car is not the biggest expense, the INSURANCE is!) After a little thought, I exercised my authority, and nixed the new car idea in favor of a used car, leaving me with just enough money to do my HH add-on. Again, some folks would argue against such a decision, but it was the right one for me. My goal is to leave at least 150 points to each of my children, and I am 3/4 of the way there! In the meantime, I plan to use my points to the fullest...every trip we have planned for the next year includes extended family and/or friends. My husband actually suggested we purchase 150 more BWV points last year when DVC converted the sales center to units, so I think he's coming around to my way of thinking. And just last month, as an anniversary gift to me, he purchased 2 premium annual passes for our 2 youngest because he knew I needed them for our late May trip(theirs had expired in Dec.2003). I'm glad I did not push my husband to buy-in with more than 150 to begin with...he was right(I'd never admit that to him, though), 150 was all we could afford at the time, and that was a stretch. If I was in the same situation again, I would purchase a small contract through resale for cash, then add-on as I could afford to do so. With your current habit of every other year at WDW, you could manage to spend a week there by banking/borrowing with a small contract(100 points or less) as long as you avoid peak times like Easter and Christmas(my original plan ) Good luck with your decision!

 

[Beca]

Here's what I would do...get an estimate on how much you spend on a typical Disney vacation. Divide it by 12 to figure out how much "monthly" payments would be on that vacation. That is something you say you figure out how to afford every year. So, that...it seems...you can afford.

Then, subtract that number from SSR's $190.00/mo fee (I do think you will need more than 75 pts., and I am assuming you are financing through Disney). This is the difference you will pay, but remember to add on trans., food, spending, etc....divide by 12, and add onto the "Monthly" ssr total. If you can handle the monthly difference...buy...if not...it is too expensive now, and can only get "cheaper" when you are no longer in school.

Good luck!!!

 

[disneyberry]

<font face="times" size="+0">i'm a few years younger than you, not married, no children... so my circumstances are different from yours. dbf and i also bought DVC when we both had no job stability (ahem, not that there's job stability now) so some would say we made a brash decision. but i would like to provide some input anyway, in the hopes that it might help give you some things to think about.

(btw, my dbf and i are both in IT and were both hit hard by the tech implosion as well. i feel your pain... it has been a rough few years...)

here is a list of questions/comments that popped into my head as i was reading your post:

1) the difference between 2042 and 2054 will be the time when you are between the age of 70 and 82. right now it seems like your major concern is spending time with your family while your children are growing up. will those extra SSR 12 years that will occur <i>much</i> later in life really make a big difference to be worth going into debt now?

2) VWL and BCV resales are the most difficult to come by now, due to their small size and the fact that they are relatively new. so there are less owners selling them, thus you will have less choice in terms of "finding the right resale" that is a best for you (not too stripped, good size, good price). are you limited to VWL or BCV? have you considered OKW (much cheaper points cost for 2bdrm, cheaper dues), or BWV (Standard Views are cheap if you can plan 11mos out)?

3) be careful, and do not <i>assume</i> that you will be able to sell DVC for a decent amount. perhaps only in the short term (until DVC stops selling SSR), we can <i>guess</i> that resale prices will stay high. but just wanted to remind you that we can't assume that resale prices will stay high, so don't count on it as a way out.

4) if you buy in now via a small resale, yes you can always choose to add-on at SSR later. you are <i>not</i> limited to adding-on via resale even if you bought less than 150 points to begin with. you should have no problems adding-on at SSR directly through DVC.

5) i do not agree with the assumption that SSR will be a more liquid investment in the resale market. real estate value in the non-Disney world is strongly influenced by location. the resorts with the "best" location are BCV, BWV, and VWL. JMHO.

6) just some numbers regarding points costs of a 2bedroom for 5 nights Sun-Thu in Dream Season (which is essentially Peak Season, excluding Xmas/Easter):
180 points for SSR
200 points for BCV, VWL, or BWV Preferred View
160 points for BWV Standard View
150 points for OKW
you could always stay off-site on the weekend nights. maybe go to Universal, or if the cash rates are good, pay cash for your 2bdrm Villa on the weekends if you really must have more than 5 nights. in any case, at a minimum, i think you need at least 80 points to start with if you want to go every other year. and even with 80, you would be limited to only 4 nights at the more expensive resort options (BCV, VWL, BWV Pref).

ok i'll post back if i think of anything else. basically, i think if you do buy, you should do it via small resale... but take your time, and find the right resale. no need to rush because i don't believe the SSR $95 increase will affect the older DVCI resort resales that much. (this is assuming the older DVCI add-ons are staying at a retail price of $84 direct through Disney)

HTH! good luck, and let us know what you decide in the end.</font>

 

[ILPHIL]

While reading the previous posts I've changed my mind several times. But that's not surprising how long it took my wife & I to decide to buy in to DVC.
As has been said already, you have presented a very well thought out analysis of your situation and in a way that may be partly responsible for your indecision. This is as much an emotional decision as a financial one. Despite all the charts, graphs and spreadsheets you ultimately have to choose whether or not owning your own little piece of "the magic" means that much to you. Whether making the investment in the DVC is what it will take to "force" you to take those family vacations and create those special memories.
For many of us WDW is a sancuary in an otherwise insane, stress-filled world. There is no way to put a $$ pricetag on that and on the knowledge that no matter what else happens your points give you the chance to escape the real world on a regular basis.
Sorry if I kind of meandered off the path you wanted in your thread, but there are many aspects that need to be considered in making the final decision.
Gook Luck whichever way you choose...