Rippem

I bought new at a used price, got 4.59% 20 yr. money, and a five year warranty.

Why would I involve anymore cash in that deal than I had too?

dave911

Own it outright! Paid cash 20 years ago in April! Definitely spent more in storage over the years, then the cost of the boat!

BGIII

iTrader: (3)

I am not the borrowing type but when I purchased my boat this fall, I could not justify taking money from investments that have consistently earned much more than the interest I pay on my boat note just so I could say I owned my boat outright. I think that as long as you have a "real" equity position from the beginning (read: significant down-payment) and the rates are good, there is no arguable reason not to borrow a portion of the value other than your personal philosophy. In today's interest environment, you can borrow money at a net rate that is within 1% of average inflation. That is as close to paying cash as your going to get in my opinion. It will look even more attractive if interest rates and rates of returns go back up during the term of your loan. If interest rates were 10%-12%, my thought process would have been different, I would probably be too greedy with my cash to spend it on a boat when rates of return are high and I sure as hell wouldn't pay 12% on a note.

I do believe that every homeowner should have a home equity line of credit and keep it maximized as far as available dollars, but I do not understand the logic behind using it except in emergencies and for the purchase of appreciating assets. It serves as an excellent emergency fund and you will be glad you have it if you lose your job or your business income slows for a while. Remember, the bank won't give you money when you need it most, having your financial house in order may save you a lot of grief during hard times. Deductibility of interest should not be your only criteria when making a borrowing decision. Plus, HELOC's have a variable rate so you could end up with an unfavorable rate at some point in the future, especially if you are borrowing on your HELOC with the intention of it being a long term payback. Why put your house in hock for your toys? What would you be more willing to give up in the event you stumble into hard times, your house or your toys?

Finally, if somebody could explain how borrowing money in order to get the tax write-off on the interest you pay is actually a positive benefit to your bottom line, I would love to hear it. I cannot figure out how saving between 15 cents and 38 cents on the interest dollar you pay is such a great deal. You're still paying interest! I get the impression that many think the interest they pay reduces taxes $1 for every $1 they spend on interest. Is there something I am missing?

epeek

Paid for!

Crazyhorse

Holy crap Bill. I don't think you've said that much the whole time I've known you.
I didn't need to borrow, as I robbed every 7-11 for a radius of 100 miles. Its a good thing they're open 24/7.

tommymonza

CASH IS KING WHEN THE SH$T HITS THE FAN is my opion.I own mine, but money is to cheap to borrow these days, specially if you have a house that you can borrow against. And if your property values are going up as much as mine seem to be you can borrow more money than you need.

fatdaddy

Rippem my thought proces exactly. I'll look to get out before my ext. warranty is up.

Andy0331

I paid cash for mine: 55k for a 28 AT. If I wanted to go bigger, I would finance. I like the "security" of owning the boat outright, but my boat isn't making any money for me. I'm better off keeping my cash invested in my business. For anything over 100k, I would be smart to finance it.

Andy

HotPursuit

I guess all of us hear have the same addiction,when it comes right down to it the
boating world in this country spends more in gas on one poker run than the gross
national product of Cuba.God Bless the USA

Rippem

Yes...GOD BLESS THE USA!

How many places in the world could so many "average citizens" have this debate?

"... I'm making monthly payments on my boat".

"Uhh...I paid cash for mine".



Do you feel blessed to live in this country or what?