Disney Debt?

[JimmyBean42]

Many were commenting they needed some unpaid credit as paying off every month somehow increase their credit score.. Is this true?

I also think that many who put a vacation on a Card and do not pay for it, have their good reasons.. Maybe this is the one and life time opportunity. Between Jobs and NOW have the time off. Or realize by time they save the cash this will be a missed opportunity for many reasons. We shouldn't negativly judge for using credit.. in fact my husband and I are thinking about a home line of credit.. our house is paid off and the interest rates are insanely low.. We have many things on our Long list of things to do...new furnance, new Couch, kitchen. Kids rooms Need Major update. etc.... Sure I can save 5 or so years... but for 2,5% I'll take the cash now and pay a bit of interest to have those 5 years of enjoyment.

Idle credit cards (unused) for long periods of time aren't the best. It's good to show some activity and paying timely. You also want the ratio to be low. So if you have a $10,000 limit, you don't want a $9,000 balance, but a $1,000 balance that you pay off timely (no late fees) works in your favor.

I agree. Some people work extremely hard and may be just shy of affording a Disney vacation. Does that mean they shouldn't go b/c they don't have the cash on hand at the time of booking? It's their call. No judgement here. I have a co-worker who books Disney vacations frequently and likes to go in the fall. But he has to use his credit card as he pays for the vacation with our bonus payment, which we receive in December. So he gets some small interest fees. But to him it's worth. And I asked him what he would do if our Company nixed bonuses one year. His reply "it's where we are happy so we'd still go, pay the interest a little bit longer and figure it out after. But I don't worry about that until they cut bonuses.....and they haven't (knock on wood)". To each their own I say.

 

[EilonwyWanderer]

We usually go into debt to go on vacation--we couldn't do it otherwise. While it's a luxury, I think it's also important to be able to get away from things and recharge (we have very stressful jobs), and also build some positive family memories with our kids. But between daycare, student loans, the mortgage, and all the other things that go wrong every month, if we waited until we could just pay upfront, we wouldn't be doing that until...well, we probably would never be doing that, honestly. We never put ourselves in so much debt we're in danger of not being able to pay for monthly bills or whatever, but it usually takes us a couple months to pay off our vacations and we tend to only go every other year or every three years.

 

[Nebraska_Disney]

Great responses and really a good insight into a lot of people thought processes.

I grew up poor and even though we didn't have extra money, we had what we needed to live. At an early age, I was taught that if you wanted something you either worked hard and saved or you did without. That never left me as I got older, put myself through college, started a family etc. I am always afraid of me or my spouse not having an income due to changes at our jobs, disease/illness/accident etc that I save, save, and then save some more. As a couple, my wife and I save/invest almost 40% of our take home pay each year. Being frugal and not using debt to live in the moment has allowed up to not only enjoy the vacations we take (about every other year and mostly to Disney), but to also have a plan to retire when we are in our 50's and living at the same level we are today. What is saved today will compound over time and provide more in the future. I guess I just like the Warren Buffet mentality.

 

[mi*vida*loca]

I think there's a big difference between putting a 5K vacation on a credit card and paying it off in a year vs. paying the minimum of $50 a month for a bagillion years.

 

[DLgal]

I think there's a big difference between putting a 5K vacation on a credit card and paying it off in a year vs. paying the minimum of $50 a month for a bagillion years.

Exactly. I mean, a couple months of being charged interest is no big deal. Spreading that $5000 into payments over a span of 20 years? Stupid...and costly.

There is a huge difference.

 

[JimmyBean42]

In college all my friends were going to Spring Break. It was my senior year and last chance to do a true "college spring break trip". Trip was in March but needed to be paid in full by February. It was probably around $1500-2000 total if my memory serves me correctly. I had a job lined up post-graduation but it did not start until late August (I did have a part time job but it was to pay rent, bills and groceries). So I put the cost on my credit card. And I never regretted paying that interest for one minute. Guess it depends on the person, the costs, the trip itself and how if it's worth it for you. But that was one of the best trips of my life and well worth the 8 months (took a little longer to pay off in full) of interest I paid.

 

[mi*vida*loca]

As someone who in my 20's had the YOLO attitude, you do not take in account the interest cost as part of the vacation cost.. You are just happy to have a credit line that enables you to book a trip NOW. BAck then a lot of friends were buying their first homes and mortages.. Many were commenting they needed some unpaid credit as paying off every month somehow increase their credit score.. Is this true?

I also think that many who put a vacation on a Card and do not pay for it, have their good reasons.. Maybe this is the one and life time opportunity. Between Jobs and NOW have the time off. Or realize by time they save the cash this will be a missed opportunity for many reasons. We shouldn't negativly judge for using credit.. in fact my husband and I are thinking about a home line of credit.. our house is paid off and the interest rates are insanely low.. We have many things on our Long list of things to do...new furnance, new Couch, kitchen. Kids rooms Need Major update. etc.... Sure I can save 5 or so years... but for 2,5% I'll take the cash now and pay a bit of interest to have those 5 years of enjoyment.

I see this a lot working in healthcare. You truly only live once. Sometimes people have the scare of their life and realize "crap I'm going to take that vacation!!" Or they really just have to take that vacation because this is it.

I think if you have a plan to pay off that debt in a timely manner what's the harm? All of my vacations have been paid in cash but if my friends said they were going to Vegas next month and it was unplanned so I didn't have it in my budget I would have no problem throwing 1K on my card and paying it off in a few months. $100 of interest would be worth the fun times I would have.

 

[fifthdimensiondweller]

So, if you'd asked me this question 5 years ago OP, I would have 100% agreed with you! My parents carried the occasional credit card debt when a true emergency arose, but for the most part they both had great jobs and had the belief that you did something when you could afford to pay for it. I would have scoffed at the idea of anyone taking a trip if they couldn't afford to pay it off immediately. For the most part, this is still what I believe and how I live my life as a 20 something. That being said, a few things that have happened to me in the last five years or to people I know have made me realize that life truly can be taken away from you so fast, so sometimes it can be worth the debt (within reason of course, as pp said, big difference between paying off 5,000 in a year and making minimums for 20 years).

Friends of ours, both healthy, had their otherwise healthy son diagnosed with cancer. He was completely fine running around one day and had swollen lymph nodes the next. He is 100% better now and in remission, and he had the lovely people at Make A Wish to provide a wonderful trip to Disney for his family, but many kids aren't so lucky because they are too sick to make the trip. As I sit here now pregnant now with my own son, I realize that I definitely want to be able to take him on a Disney vacation while he is young, even if it meant going into cc debt for a few months to make it happen, because you never know what's around the corner. Luckily for us, we probably won't need to do anything like that.

When I was a teenager, my dad was fine one day and four months later he'd passed away from cancer. It truly can happen so, so fast. I'm so thankful that my parents took me to Disney, Universal, The Grand Canyon, Niagara Falls, etc. because now all I have left of my dad is memories, a lot of them from these trips. I'm sure sometimes it meant they had to pinch pennies for a little before and after the trip, and I'm sure they both thought they'd have years of my adult life to take trips with me later, but I'm so, so happy they did it while I was young, because it turns out I didn't have that time with my dad.

I think it can be easy when one is sitting pretty with a manageable income and healthy family to pass judgment on those who put things on credit cards- and there are definitely people out there who take YOLO to a whole new extreme, don't get me wrong! But I think it's really tough to know someone's circumstances unless you talk to them, so I try to reserve judgement.

 

[Go Ask Mickey Podcast]

I have to admit i have fought with debt for many years and have falling into the credit card hole and living paycheck to paycheck. Over the past few years I have learned how to manage my debt credit and income . Now I can say I'm completely debt free thanks to Dave Ramsey and learning how to save and invest my money instead of giving it to the CC company. Disney is a major money grabber and can be a painful lesson to learn the hard way. With the right budget and savings before your trip it can be a great experience. We can afford a Disney vacation every year and enjoy it without the debt hangover. Be wise with your money and it will take you very far.

 

[IndianaRRT]

Normally, our Disney trips are planned well in advance, we save, and pay cash for everything. In 2015, DH surprised me with a trip for my 40th birthday. I handle the money, so he had a tough time figuring out how to gather the funds when he wanted us to go in April and he just had the idea the previous November. His employer offers financial services as a benefit (low interest loans, debt counseling, financial ed classes, etc), so he took out a loan to cover part of the surprise trip cost so he could book it before he told me. Was I over the moon at financing any part of a vacation? No. But he did the best he could so he could surprise me with something so thoughtful. The interest rate is really tiny since the payment is deducted from his pay (less than $75/month), and it will be paid off soon. We hardly miss that small amount, but we still talk about the trip

 

[Alexle2007]

Normally, our Disney trips are planned well in advance, we save, and pay cash for everything. In 2015, DH surprised me with a trip for my 40th birthday. I handle the money, so he had a tough time figuring out how to gather the funds when he wanted us to go in April and he just had the idea the previous November. His employer offers financial services as a benefit (low interest loans, debt counseling, financial ed classes, etc), so he took out a loan to cover part of the surprise trip cost so he could book it before he told me. Was I over the moon at financing any part of a vacation? No. But he did the best he could so he could surprise me with something so thoughtful. The interest rate is really tiny since the payment is deducted from his pay (less than $75/month), and it will be paid off soon. We hardly miss that small amount, but we still talk about the trip

I had a similar situation for DH's 50th birthday when I wanted to book a surprise Disney cruise for his birthday. He tracks every single credit card purchase we make. I ended up opening a new 0% credit card that I could pay off as soon as DS and I told him about the cruise. It worked perfectly and he was completely surprised! I even contacted his manager to let her know that DH would need the time off from work.

 

[DawnM]

We haven't ever gone into debt for a trip, and the only way we would do so is if there were a family emergency of some sort.

But what we have done is used DH's bonus (his bonuses aren't big, more like $3K after taxes tops) as our vacation money. Whatever he would get from the bonus would be our Disney money and we had to keep it within that cost.

Thankfully we can drive to WDW, so it hasn't been too difficult. We can do Disney pretty frugally and used to do it downright cheap until they changed some of the YES tickets (don't allow adults to use them, etc...) and we used to be able to get great deals off season.

We haven't been in 2 years now because the kids are in college and high school and I am back to work full time. We just haven't had time. But now we have more money.

We either have time or money, never both.....SIGH.

 

[Happyinwonerland]

long

I see this a lot working in healthcare. You truly only live once. Sometimes people have the scare of their life and realize "crap I'm going to take that vacation!!" Or they really just have to take that vacation because this is it.

I think if you have a plan to pay off that debt in a timely manner what's the harm? All of my vacations have been paid in cash but if my friends said they were going to Vegas next month and it was unplanned so I didn't have it in my budget I would have no problem throwing 1K on my card and paying it off in a few months. $100 of interest would be worth the fun times I would have.

I'm an RN and I agree. I don't put vacations on credit, but I definitely lean towards a YOLO mindset. I see so many people of varying ages that are losing their health and their lives and it really is a reminder to live your life to the fullest while you can. You never know when illness or accidents will happen and leave you unable to do all you wanted in this life.

 

[EilonwyWanderer]

Haha, I love your avatar considering your profession!

 

[clarklink]

I saved $100 a month for three years to a pay for our week on resort with regular dining plan, Bippidi Boppidi Boutique, and Lilo's Playhouse during date night at 'Ohana. I learned long ago that we decide whether money will be our master or our slave so have not had a house or car payment since 1995. My wife chose another path before we married so has to work to pay her debts. Fortunately being debt free gives me the freedom to stay home with our daughter where she is learning the power of deferred gratification as there are some things we could not do (but will do later) while saving for the trip. On her own volition she has started saving her own money to spend during our trip.

 

[Happyinwonerland]

Haha, I love your avatar considering your profession!

Thanks !

#careergoals haha

 

[PrincessV]

Normally, no. But there have been a couple times that the price I could get for a room at WDW was so much better through Orbitz - which requires full payment at time of reservation, as opposed to WDW's one-night deposit - that it was worth making the purchase, even knowing it would take two months to pay off. Yes, I factored in the interest (great credit score = very low interest rate) I'd pay for that one-month carryover, as well as the Ebates and Disney Visa Rewards I'd earn, and I still came out ahead going that route.

 

[DLgal]

Here is a little secret...if you pay interest to your credit card ONCE IN AWHILE, when you otherwise don't, they reward you with better targeted offers, often $0 fee balance transfers, and increased spending power. It's all a game.

 

[TheDisneyDoll]

I'm in this position right now sort of.
Honestly you just have to take responsibility and say I made this mess now i'll clean it up.
I've never had long term credit card debt but I got stuck in a sticky spot last year. I was in the hospital on and off for weeks at a time and in August I went into lung failure and I was in a coma for a couple weeks, thankfully I received a double lung transplant but I required two months of therapy after so I could learn to walk and use my arms again.
I wasn't allowed to go back to work until March, I was lucky to have enough savings to make it through most of the time but when you don't have money but you still have bills you do what you have to do.
thankfully since then I have been working nearly non-stop even picking up 1.5 more jobs, I have however planned a cruise it's my 1 year survival celebration cruise to myself, and it's also a gift to my Dad. He has literally doubled the size of our house and managed to make time to visit me as well. He's extremely stressed and i just want to do something nice for him.

The cruise itself isn't what my debt is i've been paying that off in gift cards I buy, but it doesn't really matter what the debt it.
I have never been irresponsible with my finances, i mean i've saved for aged either for my transplant or my funeral, so I figured this trip would be my last real hurrah and after that I get to focus on the new future I have.

 

[mistysue]

The only debt we've run into for vacations was buying DVC, but I considered the interest as a cost. In my head I added 50% to our purchase price- but in reality it won't be anywhere near that. The purchase price, plus the 50%, plus the dues divided out by point is less than we are already paying for our hotel stays as-is so it made more sense to buy in. Someday either the kids can have it or we will sell it off, but we break even at just over 11 years if we pretend hotel rates don't go up and pretend there are no savings perks. Perks make it more like half that with tickets for 5 and all the crap my kids want to buy! We will then have 38 years at extremely reduced cost.

The only thing we've really accumulated debt for is medical... which is pretty sad considering we've always had great insurance so it's all copays and deductibles.