One perspective on the current used boat market

.........uh oh....this one May be a candidate for Mike and Todd' forum......
 
Tempting. . .very tempting. . . . but I suspect that one good squabble a day is adequate.

I will apologize for needlessly baiting Gary. . . . . even though it *is* so much fun!
 
comsnark said:
. . . .well I would put it on a credit card as well. Along with lunch, and bubble gum from the local CVS.

The difference is I pay the bill in full when it comes. . .and the card provides a 1% rebate on all purchases.

Many people today simply do not understand the implications of "no reserve" and "debt".
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Scary. You would put it on the charge card...for what reason? Do you not have the resources to just pay for it with liquid? (ie checking account)

What if now ANOTHER emergency happens? Now the well fails (I have a well, dont know if you do) and it's another $8k. Charge it?

That would keep me up at night.

We have 2 credit cards, one for each of us and combined total balance of all 3 right now is about $65 for a day when I left my cash card (the ONLY card I use) home.

1% payback? Wow...even a checking account is more than that :huh: How is 1% worth charging for?
 
points, free hotels, free flights, notice he said he pays it off each month so it is no different than using his check card. Alot of people do this and enjoy it. The key is having the decipline to pay it off and treat it like your checking account. If you can't do that then probably not a good idea. Also depends on how much you are spending. 2% of nothing is nothing 2% of something is more than nothing. :huh:
 
First Born said:
points, free hotels, free flights, notice he said he pays it off each month so it is no different than using his check card. Alot of people do this and enjoy it. The key is having the decipline to pay it off and treat it like your checking account. If you can't do that then probably not a good idea. Also depends on how much you are spending. 2% of nothing is nothing 2% of something is more than nothing. :huh:
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Understood, and I wont tell people how to do finances at all. Credit is wonderful if done the way it should be, which obviously is the case here.

I have just seen way too many people overextend, and then wonder why they can make $150k a year and not have anything to show for it except a pile of bills, mostly in credit form with interest eating away.

Credit/financing is wonderful when used properly. Just the average American seems to rely on it.
 
I have always wondered how many people 'own' their boat vs. have a loan for it. Might be a good Poll for the board one day.. And do owners of the 'yacht' class tend to have loans more so than owners of the cruisers and sport boats (using searay's brand size nomenclature)?

I 'used' to think that if you had to borrow money for a boat, you can't really afford the boat...but once you get this damn itis disease...it impairs your mind and pocketbook I guess..
 
gerryb said:
I have always wondered how many people 'own' their boat vs. have a loan for it. Might be a good Poll for the board one day.. And do owners of the 'yacht' class tend to have loans more so than owners of the cruisers and sport boats (using searay's brand size nomenclature)?

I 'used' to think that if you had to borrow money for a boat, you can't really afford the boat...but once you get this damn itis disease...it impairs your mind and pocketbook I guess..
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We put down a sizeable chunk and financed the rest. The financing rate is good, and frees up money I wanted to invest elsewhere which brings in a much bigger return than the finance rate. So the investment pays the boat payment plus pulls a profit, thus the boat is almost "free" in a way.
 
billandamy said:
We put down a sizeable chunk and financed the rest. The financing rate is good, and frees up money I wanted to invest elsewhere which brings in a much bigger return than the finance rate. So the investment pays the boat payment plus pulls a profit, thus the boat is almost "free" in a way.
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You make money on your investments and get the boat almost for free. I think some guys might try to pull that one on their Admiral but with how much success I don't know.
I feel you have to look at each item individually and assess it for what it truely is. Well choosen investments are good, boats anyway you look at it are loosers. I'm talking $$ not the other parts of boating.
 
Woody said:
You make money on your investments and get the boat almost for free. I think some guys might try to pull that one on their Admiral but with how much success I don't know.
I feel you have to look at each item individually and assess it for what it truely is. Well choosen investments are good, boats anyway you look at it are loosers. I'm talking $$ not the other parts of boating.
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lol...my wife is quite savy, she is always involved in everything. All financial decisions are shared equally.

I agree, the boat is entertainment, which is usually a loss, except for the fun any entertainment brings.

By not paying for all of it cash, money was freed up to put somewhere else that makes money instead of losing it. As soon as we drove away, the boat depreciated how much %?
 
I have to agree with Wesley. If you pay off your credit card balances when they are due in full then you pay no finance charges. Most credit cards are completely free and offer some advantages like warranty extensions, free rental insurance, fraud protection, "points" or cash back. Not to mention that the proper use of credit will actually help your credit score and put you in a better position to obtain better rates for loans. We have not paid a dime on finance charges but have enough "points" to do our next 3 trips (airline tickets) for free. The money you would have spent with a check would not have netted you any interest dollars or benefits. Of course the key as mentioned is to pay it off in full when you get the bill.
 
well this doesn't take into consideration cash discounts on purchases. I know I can get a significant discount by putting a wad of cash in someones hand. Much more than the points I get on a credit card.
 
MM called be.... basically begging me to trade in my boat. Seems there is a HUGE demand for used boats and they're running out of inventory to sell.
 
billandamy said:
We put down a sizeable chunk and financed the rest. The financing rate is good, and frees up money I wanted to invest elsewhere which brings in a much bigger return than the finance rate. So the investment pays the boat payment plus pulls a profit, thus the boat is almost "free" in a way.
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Please forgive me if it appears that I am questioning you, but I guess I am. Are you trying to say that the remaining cash that you had (did not put into the boat) earns a return that makes your payment in total every month? I find that difficult to believe. I can understand if you meant to say that the return that you are getting exceeds the rate that you are paying on your boat note. Sure. But that the monthly return pays your payment...:huh:

Let's take a $40K boat and put $20K down and finance $20K at a modest rate of 5% and a stretched out term of 10 years. Your payment would be $212.13 per month or $2545.56 per year. Your ROI on the $20K that you did not put in would have to be 12.72% every year for ten straight years! That would be phenomenal. And we used very generous terms. If we reduce the amount down or shorten the term then the ROI needed jumps dramatically. Only increasing the down makes the ROI more attainable.

Again, I don't mean to offend, it just doesn't sound plausible. However, if this is correct, please start a new forum in here on investment advice and your Sea Ray so that I may learn.
 
unlvrebel said:
Please forgive me if it appears that I am questioning you, but I guess I am. Are you trying to say that the remaining cash that you had (did not put into the boat) earns a return that makes your payment in total every month? I find that difficult to believe. I can understand if you meant to say that the return that you are getting exceeds the rate that you are paying on your boat note. Sure. But that the monthly return pays your payment...:huh:

Let's take a $40K boat and put $20K down and finance $20K at a modest rate of 5% and a stretched out term of 10 years. Your payment would be $212.13 per month or $2545.56 per year. Your ROI on the $20K that you did not put in would have to be 12.72% every year for ten straight years! That would be phenomenal. And we used very generous terms. If we reduce the amount down or shorten the term then the ROI needed jumps dramatically. Only increasing the down makes the ROI more attainable.

Again, I don't mean to offend, it just doesn't sound plausible. However, if this is correct, please start a new forum in here on investment advice and your Sea Ray so that I may learn.
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No sorry, you are correct...I meant that the amount in finance payments is covered, not the actual payment itself. So in essence, we are only paying what I guess is considered the principal every month instead of the principal plus interest. So in the end, we paid "cash" for the boat as the interest is covered.
 
TurtleTone said:
well this doesn't take into consideration cash discounts on purchases. I know I can get a significant discount by putting a wad of cash in someones hand. Much more than the points I get on a credit card.
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Mike, are you talking about the.... "hey buddy you want to buy a nice stereo real cheap" or the.... "yeah we were delivering these TV's and we had a few extra's that my boss said to get rid of"? :grin: Ya gotta love NY. Anyway, that still wont get you that free blender you can use on your 280DA. (By the way...is it in yet?) Brian
 
so you know Leon with the gold tooth.
 
billandamy said:
No sorry, you are correct...I meant that the amount in finance payments is covered, not the actual payment itself. So in essence, we are only paying what I guess is considered the principal every month instead of the principal plus interest. So in the end, we paid "cash" for the boat as the interest is covered.
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I get it.

Still awesome. 10 years (+/-) same as cash.:smt038
 
Yeah. . .I hear that math.

Cheap financing plus high investment returns. . .often leads to temptation. :)
The math is simple: if you can get a $100K loan for 5%. . .and invest that $100K in the market and get 10%. . . heh. . .you win. If that 5% loan is a home equity loan, and the interest is tax deductible. . .you win more.

Of course, the fun part is when you investment returns -15% (like many investments over the last 6 months). .. and you still have to make the debt payments!

- - - - -

On the credit card front: ah heck. Why bait Gary further?
 
unlvrebel said:
I get it.

Still awesome. 10 years (+/-) same as cash.:smt038
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Yes, exactly. So it is like paying cash, but you can do it over time, while the money is made to work for you...freed up to invest instead of paying interest.
 
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