Things I wish I knew BEFORE I bought into The Villas at Disneyland Hotel

[VGCgroupie]

I haven't come across anything other than the regular 5%

There is an opportunity next month and in December to get close to 10% somewhat easily if you have certain credit cards and memberships. Discover card used at BJs wholesale online next month. In December Chase Freedom cards will have PayPal 5% back that you can buy cards at either Sams Club or BJs to get close to 10% These ones are good because you can buy in bulk. When I save a larger % it's collecting smaller amounts here and there at various places.

 

[ClaraOswald]

Ah. Yeah...we don't have BJs here. And I don't shop at Sams Club. Also don't have that kind of Chase card. I don't think I've seen Disney cards on a discount anywhere I shop, unfortunately.

 

[VGCgroupie]

Ah. Yeah...we don't have BJs here. And I don't shop at Sams Club. Also don't have that kind of Chase card. I don't think I've seen Disney cards on a discount anywhere I shop, unfortunately.

I have no BJS where I live I have an online only membership. I use it exclusively to get Disney Gift Cards.

 

[AstroBlasters]

Wow! I'm actually surprised. Good to know. 5% off isn't a lot, but it does add up. I basically buy some Disney gift cards every month. Then in January when dues show up, I use them to pay all my dues. If we do buy at VDH, I think I'd basically do the same throughout the 11-months leading up to our trip so that I could just pay TOT with gift cards. Mentally, I just like spending a small amount on gift cards throughout the year rather than taking a bit "hit" all at once.

The downside is that the money is not earning interest while it sits on the gift card.

You could set up a separate savings account in a high yield money market and then use the balance to purchase gift cards right before dues.

 

[ClaraOswald]

I have yet to find a money market account that keeps a decent interest rate for more than a few months or maybe a year, tops. I opened on with my bank a year or two ago and the interest rate was great....for a while. Now it's .05% Horrible.

So basically the money I'm putting on gift cards isn't going to be earning interest anyway. And we aren't talking tens of thousands here. Remember...I only have a measly 360 DVC points so my dues aren't too crazy.

 

[AstroBlasters]

I have yet to find a money market account that keeps a decent interest rate for more than a few months or maybe a year, tops. I opened on with my bank a year or two ago and the interest rate was great....for a while. Now it's .05% Horrible.

So basically the money I'm putting on gift cards isn't going to be earning interest anyway. And we aren't talking tens of thousands here. Remember...I only have a measly 360 DVC points so my dues aren't too crazy.

https://www.fidelity.com/mutual-funds/mutual-fund-spotlights/money-market-funds

 

[airjay75]

https://www.fidelity.com/mutual-funds/mutual-fund-spotlights/money-market-funds

Those ones are all very good. My personal favorite is https://investor.vanguard.com/investment-products/mutual-funds/profile/vmrxx. Current 7-day SEC yield is 4.09% which looks like it beats each of those Fidelity ones just a little bit.

But, if you can get 10% or more off of a DGC, I'll take that over letting it sit in a MMF, especially since all of that income on the MMF is taxable income (unless you do a muni MMF, but then you get a lower yield).

 

[atthebeachclub]

You can also use a high yield savings account, like Ally or SoFi. Both are over 3%.

 

[VGCgroupie]

You can also use a high yield savings account, like Ally or SoFi. Both are over 3%.

My HYSA sits at 4.02 currently (was more) but I still find buying GC's to be a larger savings and better way to go for me personally.

 

[atthebeachclub]

I just buy the gift cards whenever there’s a good Target bonus.

 

[PolyRob]

I have yet to find a money market account that keeps a decent interest rate for more than a few months or maybe a year, tops. I opened on with my bank a year or two ago and the interest rate was great....for a while. Now it's .05% Horrible.

So basically the money I'm putting on gift cards isn't going to be earning interest anyway. And we aren't talking tens of thousands here. Remember...I only have a measly 360 DVC points so my dues aren't too crazy.

Look into some of the online HYS accounts. Lots of them offer sign up bonuses while earning 3.5 - 4.5%. Some can even be serviced in branch if you prefer that. The Apple Cash HYS linked to an Apple Card even provides 3.65%. That one is easy to setup if you have an iPhone.

I even have a Money Market with a local community bank that provides me tiered interest up to 3.78%. It's not the highest, but they are friendly and competent and I like dealing with them. I've actually switched all my primary banking to them.

 

[ClaraOswald]

But how long do those interest rates last? It seems like the fine print always says it can change at anytime (just like mine did at my bank.)

 

[atthebeachclub]

Ally and SoFi have been doing this for maybe a decade? It’s not time limited. It changes but not by much.

 

[airjay75]

Interest rates can and will change. The past few years have been relatively good for MMFs and HYSAs with interest rates on the rise. Personally, I prefer an actual MMF. You do have to open a brokerage account to gain access to a MMF, but pretty easy to open a free brokerage account these days. They tend to be much more immediately responsive to interest rates, but they aren't FDIC insured, so many prefer a HYSA at an actual bank. Generally speaking, the bigger banks pay next to nothing for any of their savings products, even if you invest a lot with them. Online-only tend to pay more. I've used Synchrony in the past, and they have also tended to be pretty high and consistent - looks like they're currently paying 3.8%. As @atthebeachclub mentioned, Ally and SoFi have also been doing this awhile. CapitalOne also comes to mind.

Bottom line. If you've got any amount of cash you don't plan to invest or spend anytime soon, don't leave it parked in a bank account earning nothing or next to nothing. There are much better options.

 

[PolyRob]

But how long do those interest rates last? It seems like the fine print always says it can change at anytime (just like mine did at my bank.)

A typical online HYS won't go from 4.6% to 0.01% overnight, but it will fluctuate with the Fed interest rate changes.

Anything with a promotional percentage period will state that up front or explain what activities (i.e. tiered thresholds, ten debit transactions, direct deposit, etc) are required to keep the elevated rate.

Like @atthebeachclub and @airjay75 mentioned Ally, SoFi, Synchrony, CO 360, etc are known for offering competitive rates. I also really liked Discover, but CO purchased Discover back in May. This is a great resource: https://www.doctorofcredit.com/high-interest-savings-to-get/

 

[stat]

But how long do those interest rates last? It seems like the fine print always says it can change at anytime (just like mine did at my bank.)

Agree with @PolyRob, changes should be slow and go up and down with the fed funds rate. I was getting north of 5% with CIT Bank for a while, and it was 4%+ until very recently (now is 3.85%) but the changes were slow.

Note that sometimes companies do pull a fast one- maybe that happened to you? Capital One monkeyed around with their products and now there's a class action lawsuit against them. They slashed the interest rate on their main HYSA offering and made customers manually open and move their money into a new account to keep getting the high yield. I'm sure hundreds of thousands of people never noticed and or took several months before they realized what had been done to them. That was, I'm sure, their plan... and that's when I left them for CIT.

Another savings option is putting money in a U.S. treasury index fund- the yields aren't that much different for medium term bonds than HYSAs at this point and you don't pay any state income tax.

 

[RickNJane]

I find it funny that this thread has morphed into a discussion on finances. I should not be surprised as everything Disney costs money and everyone is looking for a way to cut the expense of a Vacation.

Just an observation

That is all

Carry On.

 

[airjay75]

Another savings option is putting money in a U.S. treasury index fund- the yields aren't that much different for medium term bonds than HYSAs at this point and you don't pay any federal income tax.

You pay federal income tax, but generally not any state income tax on interest from U.S government debt (it’s another benefit of most MMFs, as much or all of the interest is from U.S. treasuries). If you want to avoid federal income tax, you need a municipal bond fund.

 

[PiratesOfTheSea]

Agree with @PolyRob, changes should be slow and go up and down with the fed funds rate. I was getting north of 5% with CIT Bank for a while, and it was 4%+ until very recently (now is 3.85%) but the changes were slow.

Note that sometimes companies do pull a fast one- maybe that happened to you? Capital One monkeyed around with their products and now there's a class action lawsuit against them. They slashed the interest rate on their main HYSA offering and made customers manually open and move their money into a new account to keep getting the high yield. I'm sure hundreds of thousands of people never noticed and or took several months before they realized what had been done to them. That was, I'm sure, their plan... and that's when I left them for CIT.

Another savings option is putting money in a U.S. treasury index fund- the yields aren't that much different for medium term bonds than HYSAs at this point and you don't pay any federal income tax.

Just a note, treasury funds are generally not federal tax exempt, but state and local tax exempt. We park most of our cash in VUSXX since it gets >4% yield these days, plus the added bonus of not having to pay high CA taxes on the interest.

I find it funny that this thread has morphed into a discussion on finances. I should not be surprised as everything Disney costs money and everyone is looking for a way to cut the expense of a Vacation.

Just an observation

That is all

Carry On.

Especially when we are all here to make bad financial decisions!

 

[stat]

You pay federal income tax, but generally not any state income tax on interest from U.S government debt (it’s another benefit of most MMFs, as much or all of the interest is from U.S. treasuries). If you want to avoid federal income tax, you need a municipal bond fund.

Thanks, corrected.