Disney’s Vacation Account is a fun little idea. Disney wants people to be able to save for a Disney Vacation, so it put together a site that allows them to do just that. You select a trip, estimate your costs, and set up an FDIC-insured bank account (actually at Chase) through Disney. You can set up regular deposits by credit or debit account to fund the account. You can only deposit money by credit or debit card (or Disney gift cards). The money is always yours, and you can withdraw it (in the original form of payment) at any time.
While this sounds straightforward enough, some of the perks of the Disney vacation account create some complexities when it comes to travel hacking. Here's what you need to know if you're considering using Disney Vacation Account for your next trip.
The Pros of Disney Vacation Account
1. The 2% Back Perk
The Disney Vacation Account grants $20 in Disney gift cards per $1000 spent from your vacation account prior to December 31, 2017. The account must be active for 120 days prior to spending to qualify for the $20 bonus (this is to prevent people from just passing money through the Disney Vacation Account the day they book). You'll note, as these sort of kickbacks tend to go, that Chase should easily be able to get a 2% return in 120 days, which is why they don't mind so much kicking the 2% back to you. Also, since the kickback is a $20 gift card per $1000 spent, you'll max out at 2% back (if you spent exactly a multiple of $1000) and the minimum is only 1% back (if you spent $1999.99).
2. Loading with Disney Gift Cards Allows Stacking
You'll occasionally find great deals where you can get 5% off Disney gift cards. Usually this is because a card or portal is giving 5x or 5% back for shopping at a specific store. Since you can put those gift cards into your Disney Vacation Account and get 2% further back, you could spend a net of $930 for $1000 on your vacation. Disney Tourist Blog also covers the Target RedCard stack, though your mileage may vary attempting that.
3. Anecdotal Evidence Suggests Deposits Code as Travel
If you're using a card that earns a high rate of return on travel expenses, anecdotal evidence suggests your deposits into Disney Vacation Account will code as travel. (Specifically, the below photo is from a deposit I made using my Chase Sapphire Reserve.) This means that even if you can't find gift cards at 5% off, you can still wind up with a nice stack by getting 3x points back (using a Chase Sapphire Reserve or Citi Prestige) and 2% back with the gift cards.
The Cons of Disney Vacation Account
1. Don't fall into a credit trap
"Saving" using a credit card is a bad idea. If you are not paying your balance in full, and if you are not hacking Disney Vacation Account for all its worth, then you're just lending Chase money at an interest rate lower than you'll pay on your credit card.
2. The More you use Disney Vacation Account, The less other hacks are open to you
For every hotel stay you book using the Disney Vacation Account, you're missing out on a chance to use the Citi Prestige's "4th Night Free" benefit. You're skipping deals you might find on Undercover Tourist. You're giving up the chance to rent Disney Vacation Club points. Similarly, by using the money for tickets, you'll miss out on discounts you could get on sites like Undercover Tourist. Disney is offered you 2% back, but there are lots of ways you might be able to beat that 2% using other means.
3. There's an opportunity cost to giving Chase/Disney that money
Let's say you put $1000 into Disney Vacation Account using a debit card because you want the 2% back (we'd advise attempting some sort of stack, but this example is to make a a point). You leave it there for 120 days to get the $20 gift card. What did you lose? Well, A 2% return in 120 days is only about a 6.1% return over the course of a year - less than you would expect to get if you invested that money. Obviously not every 120-day period will have a 2% return in the market, but this is important to remember, esepcially as you put larger amounts of money in the Disney Vacation Account for longer amounts of time.
A counter-point to this is that, besides the $10 minimum to start, nothing seems to require that you keep a certain amount of money in your Disney Vacation Account to earn the 2% back on spending. Rather, the rule states that your account has to be "active" for 120 days. Given that most people will be contributing small amounts over time, I would strongly expect (without hard evidence) that a $10 opening deposit followed with a $990 "pass through" deposit when you book 120 days later would earn you the $20 back. I hope to test this sometime.