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Buying Disney Magic On Credit

I can’t count the number of days my wife and I spent at Walt Disney World while our girls were growing up. Our 20-something daughters still seize every opportunity to visit their character “friends” and favorite rides when they are near Orlando.

We had annual passes for a couple of years when our children were small. I was newly self-employed and had flexible work hours, the girls were not yet closely tied to a school calendar, and our Florida home was close enough to allow easy trips to the parks.

We have a lot of great memories. There was the time Jessica, the eldest, wrote to then-Disney Chairman Michael Eisner to complain that there were no Hanukkah songs in the pre-show holiday program at Epcot’s America pavilion. “I am a Disney girl,” my 7-year-old declared to Eisner, as though the situation called for some sort of loyalty oath.

She never heard back from Eisner, but there was a Hanukkah song in the America holiday program the following year.

There was the time, the very first time, Jess took her younger sister by the hand and the two of them headed into a theme park on their own. They had no more chance of getting lost there than in their own bedroom. My wife and I watched wistfully for a minute as they passed through the gate, and then we headed for the hotel pool — free forever from the summertime Disney Death March.

Of course the whole thing cost a fortune. I could probably retire on the money we spent at Disney over the years. But if the goal is to economize, none of us would have kids in the first place. We found other places to stretch a dollar, and we counted ourselves very lucky that we could give our family the Disney experience. In the end, it’s all about the memories.

Disney understands perfectly well the importance of memories. This theme is at the heart of a new promotion to allow Florida residents to buy their annual Disney passes on credit, making 12 monthly payments. A similar deal has been offered for a couple of years to Southern Californians at Disneyland, according to Mouseplanet.com. (Yes, there really is a Mouseplanet.com.)

I will admit that I cringed when I first heard about this. Granted, even if Disney is not “the happiest place on Earth” (the nickname the company uses for California’s Disneyland), it is at least a plausible candidate. I give a lot of credit to any outfit that can host that so many kids with so little crying, each and every day. And I’m not just talking about kids crying; it’s an achievement to have so many smiling parents, too.

But all this happiness doesn’t come cheap. Theme park admissions are horrifically expensive, whether on a daily or annual basis. Annual passes for two adults and two post-toddler children can set a family back close to a couple grand. When a family can’t afford to swallow that price tag in one big bite, does it become more digestible if you break it into monthly chunks?

And what happens when circumstances change and a customer can’t afford to pay up? I have met Goofy many times at the theme parks. He is a large fellow. If you fall behind on your happy payments, is Disney going to send the big dog to your door to collect? Think what that would do to your kids’ psyches.

It helps that Disney does not charge any interest for buying on credit. But there are two catches.

First, the company might change that policy in the future. Disney notes that “currently there are no finance charges with the monthly payment program.” Pay attention to the word “currently.”

Second, the payment plan requires a credit card. This facilitates Disney’s monthly collections, which makes the program much more practical for the company. But unless the buyer pays off his or her entire credit card balance every month, the payment plan is going to increase the consumer’s credit card debt, which can carry interest rates in excess of 20 percent. So the payment plan can end up costing the consumer extra money, even though Disney does not impose a finance charge.

In other words, you or I might think the monthly payment plan is a bad deal, and we might choose to pass. There are plenty of other ways to spend our time and money.

Not everyone feels the same way. Who am I to tell another parent that it isn’t worthwhile to do the very same things I did with my family? Like any high-priced good, Disney tickets are a sacrifice — but that does not mean they are not a good value. It depends, in the end, on how much we value both the experiences as we have them, and the resulting memories afterward.

So if the monthly payment plan appeals to you, it is okay to consider it, as long as you consider it carefully. I don’t recommend adding Disney tickets to your credit card debt, or foregoing life or disability insurance payments so you can spend more time at Animal Kingdom. But we only get one turn at life, and if Disney time is what you value highly, then, as the folks in the mouse ears suggest, “have a magical day.”

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book, The High Achiever’s Guide To Wealth. His contributions include Chapter 1, “Anyone Can Achieve Wealth,” and Chapter 19, “Assisting Aging Parents.” Larry was also among the authors of the firm’s previous book Looking Ahead: Life, Family, Wealth and Business After 55.

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