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Old 11-18-2019, 02:48 PM   #41
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Sounds like someone trying to generate boat sales.
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Old 11-18-2019, 03:54 PM   #42
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Financing? Cash? Percent of net worth?


Doesn't it matter if you use the boat 20 times a year? 60 time a year? 6 months as a vacation/winter home? Full time liveaboard? Halfway though your working life? near retirement? fully retired? plenty of and pretty guaranteed cash flow? Living off just meager investments? Combinations of these?



I see comments and theories that make perfect sense for one category and nonsense for another.



Yet another discussion without specifics that goes round and round and will because no one is really wrong....but plenty of info just doesn't apply to all boaters.
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Old 11-18-2019, 04:51 PM   #43
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Originally Posted by psneeld View Post
Financing? Cash? Percent of net worth?


Doesn't it matter if you use the boat 20 times a year? 60 time a year? 6 months as a vacation/winter home? Full time liveaboard? Halfway though your working life? near retirement? fully retired? plenty of and pretty guaranteed cash flow? Living off just meager investments? Combinations of these?



I see comments and theories that make perfect sense for one category and nonsense for another.



Yet another discussion without specifics that goes round and round and will because no one is really wrong....but plenty of info just doesn't apply to all boaters.



Well said.
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Old 11-18-2019, 07:40 PM   #44
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One rule that seems ball-park accurate is supported by MM's post: buy a boat right, keep it maintained, apply reasonable upgrades, and you'll sell it for roughly what you paid for it.
There have been multiple comments like this one and I'd say you're right. If you buy a used boat for a really good price, and don't over improve it, then you'll likely sell for little loss or even positive.

But that doesn't hold true for new boats. I built a new boat on a very tight budget and when I sold a few years later I still lost about 20%.
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Old 11-18-2019, 09:03 PM   #45
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Not financing a boat but saving for it over 5 - 10 years in order to pay cash just means you miss out on boating during the wait. Unless you already have one and moving up. But even with that you don't get to enjoy the new boat as long.

I know several people who delayed buying a boat until they had cash. Or delay retirement to buy their first boat or their dream boat. Two died before buying the boat, another one's wife got rheumatoid arthritis and could not get on a boat and two died shortly after buying the boat.

Lifes too short. Buy a smaller boat or finance one and get out on the water. You don't need the best boat or the fastest or the biggest or _____________ boat.

I remember how enjoyable it was saling all day in a 8' El Torro when I was 12 - 14 years old. Simple fun with basics.

You'll live longer, healthier and happy as a boat owner.
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Old 11-18-2019, 09:32 PM   #46
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Mark, it strikes me as very closed minded to say "you can't afford a boat" if you don't do it like me. Not everyone has your resources or ability or desire to pay others for all necessary work.

I think it's important to point out that your single annual KKMI maintenance bill is higher than my total annual boating budget including my dockage, insurance, repairs, maintenance, and fuel/oil. I know this b/c you have told me the bill total in the past which I will not share here.
Al, if one cannot afford the holding costs of owning a boat, one cannot afford to own it. And one can save lots of money by deferring purchase and building up lots of cash. That's how I did it. Meanwhile, take the kids camping.
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Old 11-18-2019, 09:50 PM   #47
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Not financing a boat but saving for it over 5 - 10 years in order to pay cash just means you miss out on boating during the wait. Unless you already have one and moving up. But even with that you don't get to enjoy the new boat as long.

I know several people who delayed buying a boat until they had cash. Or delay retirement to buy their first boat or their dream boat. Two died before buying the boat, another one's wife got rheumatoid arthritis and could not get on a boat and two died shortly after buying the boat.

Lifes too short. Buy a smaller boat or finance one and get out on the water. You don't need the best boat or the fastest or the biggest or _____________ boat.

I remember how enjoyable it was saling all day in a 8' El Torro when I was 12 - 14 years old. Simple fun with basics.

You'll live longer, healthier and happy as a boat owner.
100% this ^^^

Time and experience rather than net worth is our most precious form of wealth. It took me a long time to figure that out.
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Old 11-18-2019, 10:11 PM   #48
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I bought a boat a few years ago and I’m slowly working on forgetting how much I paid for it. I also quit keeping track of how much I spend to maintain it. That way if my wife asks, I can honestly say I don’t know. Name:  IMG_7316.JPG
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Old 11-18-2019, 10:22 PM   #49
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100% this ^^^

Time and experience rather than net worth is our most precious form of wealth. It took me a long time to figure that out.
The two most critical assets that money can't buy are time and health. There are so many people with high incomes and wealth and possessions, but they don't have, or don't make, the time to enjoy their money. They miss their kids growing up. They don't get time with their spouses, leading to not even really knowing them well and eventual divorce. Or they save for the future but by the time they're ready to use their savings, they or their spouse has lost their health. I've even known couples who couldn't do what they'd planned in retirement because a child of theirs had lost their health. One whose child died leaving three kids behind that then they had to raise. They enjoyed the grandkids immensely and they saw all three graduate from college. Now, they could retire and travel, although had to wait for the granddaughter's wedding. The grandfather did look forward to walking her down the aisle. Unfortunately, he had a heart attack and died one week before.

One thing I've learned is that we can't change the past and we can't control the future. We have the present and we need to live it fully to the best of our ability. That doesn't mean we ignore planning for the future, but we don't sacrifice the present for a future we can't guarantee.

We saved toward retirement, but never in doing so did we deprive ourselves of enjoying the present. We lived on the lake but in a small home. We owned a large bowrider. If I'd had to borrow for the house and boat I would have. I would not have said I didn't deserve them until I could save for them. I would have had a less expensive boat. I would have worked longer in my career. However, we wouldn't have sacrificed our prime years simply because we had to finance. We would have financed within our means, consistent with what was affordable at our income level.

We budget and use it to plan and we live within our means. However, when something really important to us comes along, we look at it's impact and we change our plans. There are those extended family members very important to us and we'd start selling boats and houses or do anything else we had to if they had a need we wanted to somehow take care of.

I worked at least 330 days a year, working 6 and 7 days a week, working 52 weeks a year, working 60 hours a week, before I met my wife. I never worked more than 45 hours a week after that and I took every vacation I had plus bargained for more each year. We turned down higher paying jobs because we didn't want to sacrifice our happiness. Thank god she taught me what was important in life. My father was an alcoholic and smoked heavily and died of a heart attack at 59. My mother had heart trouble and she died of a stroke at 68. My wife's parents never saw retirement. If we were to die tomorrow, we've enjoyed our lives in amazing ways.

There is a balance between over-extending and depriving oneself. Finding that is important and each must figure out how to do so for themselves.
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Old 11-18-2019, 11:16 PM   #50
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100% this ^^^

Time and experience rather than net worth is our most precious form of wealth. It took me a long time to figure that out.
So true Steven. My wife and I walked away from corporate executives positions to start our own business in our 30's and retired from that in our 40's when we felt we had enough.
We started part time businesses to keep busy and extra cash but we boat all summer and spend a lot of time working on Sandpiper. Eventually downsized and moved out into the sticks. We missed the high earning potential of corporate life but we never look backward.

Sounds like you are headed in that direction, but more adventure.
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Old 11-19-2019, 06:12 AM   #51
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One has to look to see where above the minimun net worth/cash flow it takes to be comfortable in many aspects of life to say whether it is worth the stretch or not.


When one has to cut back on simple things in life to afford things...that's wholly different than giving up or reducing luxuries in order to buy a boat.


Giving up the family ski vacation to pay for winter storage say rather than reducing grocery bills, air conditioning bills, etc don't equal in my book....
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Old 11-19-2019, 06:23 AM   #52
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Greetings,
Mr. ps. Excellent point. Similarly, saving until you can buy a "big" boat keeps you off the water for X months/years. You can't get that lost time back.


Our "up north, summer boat" is a 23' Penn Yan. We've had our grandkids out annually for a one week "adventure" for the past four summer. Two adults, two boys (10 and 14) and a 65lb dog. Cramped? Hahahaha. Of course but I wouldn't change a thing. Looking forward to NEXT summer.


I do store it on a trailer in the back yard but only have about $6K into the whole works.
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Old 11-19-2019, 09:53 PM   #53
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Passagemaker has an end page editorial that cites a widely held rule of thumb that a person should spend around 5% of their net worth on a boat. The author's main point is that he doesn't agree with that rule of thumb but it still got me thinking.

In my mind I've been thinking that the right amount to budget is about the same as I'd spend on a house - which is a good bit more than 5% of my net worth.

So what do people think? Is there a good range that people should budget for? I don't want to end up buying a boat that is way more than I can afford....
Hmmm, 5% you say. Guess I need to buy a bigger boat.
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Old 11-19-2019, 10:16 PM   #54
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Hmmm, 5% you say. Guess I need to buy a bigger boat.
Exactly. The idea that by valuing a boat you can calculate the owner`s net financial worth is preposterous.
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Old 11-19-2019, 10:30 PM   #55
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What is the typical boat-loan interest? Worth it for immediate gratification unless moving full-time home from land to water? I say "no" and others will say yes/yield to the power of compound interest.
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Old 11-19-2019, 11:43 PM   #56
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As already mentioned here, financing a boat allows one to enjoy the lifestyle earlier. I think this is the best reason to go the loan route. But don’t forget that for many, borrowing makes more financial sense than buying cash. In the last 10 years or so the income from common investments like mutual funds are higher than what lenders are charging for boat loans. Add to that the tax benefits of having a mortgage deduction on your boat loan and it makes little to no sense to buy outright.
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Old 11-20-2019, 12:02 AM   #57
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What is the typical boat-loan interest? Worth it for immediate gratification unless moving full-time home from land to water? I say "no" and others will say yes/yield to the power of compound interest.
You make immediate gratification sound bad. Is a kiss by a loved one bad? Is sex bad? Is the gratification of being able to spend time on the water with your kids bad? I think there is danger in immediate gratification, things like drugs and alcohol, but I don't dismiss it all. There is no future gratification as valuable to a parent as time with their children today. Boating, in my opinion, is absolutely one of the best family activities possible. There are few other ways for the entire family to enjoy themselves together. Most of the time they're all off in separate directions.

You talk about compound interest but several others have addressed the other side. My earnings on investments have far exceeded prevailing interest rates on boat financing the last few years and that's not even counting investments in business. This is coming from someone who doesn't finance boats, but there's a lot of logic in doing so. Seavee has given great arguments here for financing.

There's also the opposite of immediate gratification. That is waiting for a time that never comes or that may come too late. It takes the form of "We're waiting to get married until we have better jobs." Or, "We're not going to have kids until we're sure we can afford them." Or, "we'll buy a boat when our kids are all out of college". Kids graduate and one of the spouses becomes ill.

I'm conservative in nature, but we should not be so conservative as to forego opportunity to enjoy life. We can be so scared of being unprepared for the future that we miss all present opportunity. My wife and I faced a situation shortly after meeting in which there was a real possibility of having to give up our careers and everything we had in life to be together and we both were ready with not one moment's hesitation. For the first time in my life I had my priorities right.

We also both have only unpleasant memories from our childhoods, so I say without hesitation to all parents not to do anything that forces you to miss the opportunities you have to spend with family and kids. You can't ever get that family time back. It's worth more than any retirement plans.

I respect that what you have done has worked for you, Mark. However, I don't like disparaging others who feel differently. Don't dismiss immediate gratification altogether. What we've done is more like what you've done in waiting, but doesn't mean it's the best way for others.
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Old 11-20-2019, 12:09 AM   #58
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So many ways of looking at things.

I "could" have borrowed against the house and bought a more expensive version of what we have and been half a mill or more in the hole , then paying $12,000 a year for a spot to park her and also needing a car so I could go back to work indefinitely to pay for a boat I rarely had time to use let alone maintain, so then pay out even more.

Or I could buy the cosmetically not so shiney version for cash, rent out the house and go now relatively young with more than enough time for fun and maintenance., no marina berth required.
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Old 11-20-2019, 02:26 AM   #59
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"So many ways of looking at things."

So true and not one absolute path. We are debt adverse but It really comes down to what numbers work for you and what trade offs one is willing to accept.
Find that balance if you can and take the plunge. We've had our boat for five years and I hope to own it for another 10-15. Whenever we are done, these will be treasured times!
Best of luck in your search.
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Old 11-20-2019, 04:58 AM   #60
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knew i made an error

i'm worth about 5% of my boat
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