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Involved discussion on finances and plans to purchase boats

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Old 07-18-2002, 02:00 PM
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I wonder how many younger (I'm 41, so younger is younger than me) enthusiasts are risking their fanancial future for the present? I still have four kids in school (not college) and would not pay big bucks for a boat though I could easily afford the payment. Unless I could burn $300K and not care, I sure wouldn't spend it on a new boat.
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Old 07-18-2002, 02:03 PM
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Good story but im not saying that the "super rich" folks are not mean, ignorant or cool people.
Lets see if we can get someone here that makes with his wife a average 150 Grand a year income ish somewhere that is what a normal person considers doing well)
that sprung for a top gun or a fountain or whatever, does not matter what boat, that is in the range for a boat say between 160 thou to 300 thou (boat can be used as well no problem)
Fair enough?
Just post up the following
What did you put down up front,
payments per month and term (5 yrs-12 yrs ect)
Does your wife kick your butt to the curb each time a bill is due?
My wife is moaning that were poor cause "we own a boat"
My boat cost me 17 thousand bones and I have invested about 13 thou into it.
In reality from what I have seen up here Hell there are single engines that cost more than my whole shebang.
Thanks guys!!!!!
Jason
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Old 07-18-2002, 02:25 PM
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Jay-
There are also business owners that have the kind of money to purchase the big toys and don't, until they are ready. They run the boats that don't cost much and require constint maintaince, until they get the bills all knocked out. Then they buy the big boat.

One thought for you to chew on. You say that they are building houses across the street that go for 500-700k. That has got to be upping the value of yours? I would really have to consider selling and taking the profit, paying some bills off move into a nice house in a lower market and then start saving for that boat. I live in the country with 10 acres and a small house, paid a small amount for what I have. But they are possibly going to connect the main road to the intersate 5 miles up the road. You can bet I will sell when it ups the property value!!

Just a thought!

Chris
 
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Old 07-18-2002, 02:39 PM
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Default good question....my 2 cents

I wonder how I do it myself, it has become
a fixed cost, first boat 300.00
2nd 10,000.00 3rd 24,000 4th 60,000
this one over 100,000 with some negative
equity from the last one, 5000.00 down
15 yrs 800.00 month.
Small biz owner with 3 yrs declining sales
in this wonderful economy.
Just got married a year ago so no help
there. This will always be my expence.
I think my justification comes from living
in the same house I had built when I was
25, I'm 40 now the combined payments are
still less than most peoples house note.
Not to mention insurance, docking, gas, etc.
Its an expensive hobby, but i don't like golf.
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Old 07-18-2002, 02:46 PM
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Jay,

There are many thing to tpuch upon here. If I forget one I appologize in advance. Affording a boat, home, car etc. and making the payments are far cries from one another. I know people on this board who haven't a pot to piss in or a window to throw it out of but are still driving around in new/newer vehicles and or boats. Some come from old money, others parents/grand parents bail them out. There are also people here who have boats that cost more and are much nicer than their homes. Some are genuinely well off and successful in their own right. God bless them and much more success to them. Just don't let appearances fool you. Certainly, there are those who are EXTREMELY successful and just plain rich.

To be more specific regarding your question. I for one do not believe in financing fun. No car/truck loans, no snowmobile, waverunner, motorcycle or boat loans either. I do not buy what I cannot afford. Also, leasing is VERY EXPENSIVE unless you own a business and write the lease off through the business, all it does is put more money in the dealers hands and less in yours. PERIOD! Again, if you own a business then leasing MAY make sense.

You should NEVER sacrifice your retirement savings and saving for a rainy day to buy a boat. Remember, the odds are not in your favor that the boat will increase in value. Start saving for your new baby now, only after you have both maxed out your retirement savings plans. Also, if you have alot of equity in your home, a home equity loan or line of credit may be the most effective way for you finance your new toy. In fact, in many circumstances it may be better than paying cash as the interest is tax deductible. Also, it was said earlier and is TRUE, that if the boat has a head, kitchen and sleeping quarters it MAY qualify as a second home and therefore interest MAY be deductible in that case too.

A great book that you may want to read is The Millionaire Next Door. It was written by Jack Stanley and Bill Danko. It is really enlightening and a great read. I hope this is somewaht helpful and if I can be of any further assistance please let me know.

Shane

Last edited by Shane; 07-18-2002 at 02:50 PM.
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Old 07-18-2002, 02:55 PM
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One more thing I forgot. Many people that are well off do not brand new. Many buy slightly used but immaculately maintained vehicles, boats, cars etc. There is so much depreciation in the first year or two is much more than they are willing to bear. It makes alot of sense. I tend to do that myself.

Keep in mind, you cannot spend your way into prosperity.
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Old 07-18-2002, 03:16 PM
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Damn, Jay - thanks for making me feel poor!

All I can tell you is, if you have kids you can kiss that $100K+ boat goodbye!

Personally, we both work, one child, just moved into a newer (and larger house). I drive a ten-year-old truck with 150K+ miles, wife's car is 8 years old with 100K on it. No car payments, boat is 15 years old, so no payment there either. Still, we feel financially challenged sometimes, especially when we look at what we will be facing soon with child care costs. I think you touched on it when you talked about being a business owner. Most of the folks making the really big $$ sure as heck aren't doing it by working for someone else. They bought or started their own business, built it up, then either sold it or are reaping the benefits from it after it took off. That's why they call them entreprenuers (risk takers). I just wish I could work up the nerve and come up with a niche to do the same.

Good luck!
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Old 07-18-2002, 03:17 PM
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This is my assessment;

Run their own business, hopefull a CASH business
Don't have any kids
Wives that work
Don't have to provide a family "class" home
Inherited the money
Plain 'ol stepped in it.

I still buy lottery tickets and I am into a pretty decent 6 figure income. I do all my own work and pass it off as a "hobby"

I'm looking at an upgrade, but my finger is in a lot of pots. I can afford more, but I'm not stupid. Go to national liquidators sometime...

wanna buy a boat!

http://www.newfocusis.com/shooter/index.htm

(gratuitous excuse for another buy my boat plug!)
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Old 07-18-2002, 03:25 PM
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JAY- My first reaction is to tell you to look around.... I'll bet you'll see alot of people that work just as hard as you, or harder, that make substaintially less then you & have less to show for thier labor.... Its easy to notice those with more... keep it in perspective..... As a CPA I do work for business owners that make millions every year... some are very happy were they are.... others never will be... I work for myself... thats my reward... not that the $$$ doesn't matter... but it REALLY isn't the driving force... I like the autonomy being self-employed provides.... You're 31? Give it time son .... wealth takes time to accumulate.... like SHANE said.... you can't spend your way to prosperity.... one more thing.... it was mentioned here several time to use the equity in your home to finance that new boat.... if you do remember... should you be unable to make that loan payment... the Bank will not take the boat... they take you HOME... be careful there... or at least by a comfortable boat to live in....
 
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Old 07-18-2002, 03:29 PM
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This is my strategy.
1) Buy low hour slightly used boats. Never buy old boats. Never buy a new boat.
2) Pay it off and sell it for near what you bought it for and put the cash down on the next one. If you cant buy the boat for less than market value dont buy it.
3) Have your priorities straight. I drive a 1993 full size Blazer thats been paid for since 1995. There is room for a boat note without a truck note.
4) Own your house and use the equity in it to your advantage. We are a double income family with one child and the house will be paid off in 10 years.
5) Never get into an upside down deal on a boat. Always be able to dump the boat quickly at less than market value and still get cash back. If you cant dont buy it.

So right now I have a boat note, with tax deductable interest that I can get out of if anything changes, instead of a truck note. I own my own business and this gives me the ability to pay the boat down quickly with chunks of cash every now and then. The hard part is not buying superchargers and such and just pay for the boat first.

My first boat was a '95 22 Scarab that I bought in '96 and sold for $500.00 less than I paid for it in '02. Put the cash from the Scarab along with some savings down on a year old 27 Fountain with 32 hours. The Fountain will be paid for in 3 years and still be worth almost what I paid for it.

There are plenty of good deals out there. If I do this a few more times I will have the near new 35 Fountain I have always wanted. The trick is being able to buy the boats right. The home equity line of credit makes this possible. It gives you the liquidity to jump on a good deal when a seller gets motivated. It also lets you buy your new boat without having to sell your current boat first so you never miss any boating. Never get upside down on a boat and dont think you can makeup your maintance or modification cost (new engines). This hobby has lots of cost besides the purchase of the boat.

Just my strategy, it will never get me that $600K Outerlimits but it will keep me in clean low hour performance boats.

Ron
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