Pay or Payments?

[Rockymtnsurfer]

I am curious......With the cost of these new fabulous looking boats.......do most people make payments with crazy financing....or pay outright for them?
Not here to judge people....just really curious....the cost is getting to be as much as some homes

[Last Mango]

To each his own. We won't finance a toy. If times get tough, payments on a toy are painful.

[ST3]

I agree with Mango. It would be very difficult to enjoy a toy like this knowing that those payments are coming each month. I saved and researched boats for years before pulling the trigger. The family had all but given up thinking we would never get one. . That’s just me. I have plenty of friends that don’t seem bothered by having payments at all. Totally a personal choice.


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[Infinity]

I think it comes down to how much you get out of it and what its worth to each person. I was blessed to be able to have no payment but frankly with the great family times/enjoyment and how much stress relief I get from all things boating....I would take on a payment to have a boat if I had not been in the position to pay cash then, I would have just made sure to keep it affordable for me (which is different for everyone). It would be much harder for me to pay cash now with new boat prices getting so high and I plan to keep my current ride for another 4yrs or so and keep mine in great shape.
You live once and for me, kids are only kids for so long and it has given our family with teenagers a great way to spend time together and bond, they love bringing friends out with us and I love knowing they are doing something active rather than sitting in front of video game consoles. As I have aged, I realize more and more how important quality family time is too me as well as the importance of having a hobby like this to take my mind of work and the stresses that come from that.

[Neptune442]

My wife and I make enough money where we could walk into any Nautique dealership and get approved financing for whatever loaded-up G23 we wanted. But for me, there's just a different sense of pride I take in owning things outright...and not to mention the peace of mind you get by living debt free. It's called personal finance for a reason - but the math nerd in me just can't get past putting those monthly payments into a retirement calculator and seeing the true cost of investing money into a depreciating asset. And I get the while "family time" argument...but I also know that I absolutely cherish my childhood memories learning how to ski, kneeboard, wakeboard, barefoot etc behind a beat-up Sea Ray with a 75hp outboard. So to me, the argument that you need to spend big $$$ to create lasting memories is just another way for people to justify making a poor financial decision. Sorry for the rant...

[Rockymtnsurfer]

Thank you all for responses.....I have always been curious......I like owning things out right....but boy these new boat are absolutely beautiful........I am jealous Thanks again!

[Kenv]

Rocky....you have one of the greatest hulls/models of all time!! Yep...my childhood memories were created in the wake of a 1976 Glastron. My kids memories are being created behind the AWESOME wake of a G21. My kids kids might someday choose ATVs over boats or something of the such. BUT.....No matter what kind of boat you have.....get out there and enjoy. One more thing....nothing beats the purr of a 1986 Nautique 2001 going by in the cove. I could watch it a thousand times. I'd buy that soundtrack....LOL

[Rockymtnsurfer]

Thanks for the reality check Kenv!

[MTRBTR]

No body will admit to making payments now....

[WakingAround]

Honestly I can’t imagine not making payments. I make money for borrowing money, seems like a straightforward decision. And for those saying they can’t make payments on a depreciating asset, cash by definition is a depreciating asset. So that $500-$1000 payment today is 2-3% lower every year. There is a sense of safety that comes with not making payments and I totally get that but I have enough income diversity that I can absorb the risk.

[Blamey]

I make payments. I bought my last 2 boats with cash. Then I stumbled upon what I thought was a great deal on a 2009 230 SANTE ($39k).

I didn't quite have the cash to purchase the boat. I put 10k down and financed the rest @ 4.5% with the plan to pay most of it off when I sold my 1996 Super Sport. Leaving me with a bit over 10k financed.

Once I sold the Super Sport I decided to use the money for other things. I have 3 kids under 5 and bought our house 2 years ago, both these things come with pretty large upfront costs (childcare and home updates) along with some other short term debt.

I know I should be saving a little more but my wife and I do max out our 401ks. I could've paid the boat off in the 18 months since I bought it but I'd rather enjoy myself.

My wife and I are almost out of the new home/young kid/car payment/student loan grind. As things get paid off we should see around 3k per month in savings (after tax) this year, along with us both getting pay increases that add around 2k per month (after tax).

My point is, for us we financed because at the time it made sense from a cashflow perspective but the $100 per month in interest we pay isnt a significant cost to our overall budget. We are still able to save a good amount of money and have decent savings. It's not as simple as financing vs not financing but more what is the cost to you and how much is that affecting you overall financial health. If you are able to meet your overall financial goals and financing let's you get more boat then you have the cash to pay off, then that's cool.

Personally though I wouldn't want to be paying more then 2 or 3 % of my after tax income on boat interest.

This time next year I could probably afford the payment on a new G23 but it would put a very big dent in my overall financial health.



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[FOB1SAN]

I’d rather have 200k sitting in my bank account. Make payments, upgrade every 3-4 years. Enjoy it. Times are tough, sell it. Payments go away. Not that difficult.

[Rockymtnsurfer]

Interesting comments...thank you. One thing I have noticed here in Steamboat with new snowmobiles......people buy a new one, use it for the season and then sell it that summer, and then upgrade again the next year. I have always figured their lose is what they pay to have new machine every season. I do not know the number game there, but I guess if you want the best of the best every season, that might be the way to go. I wasn't sure if that is the same with boats. I do appreciate the feedback....I think they are all good justifications. Thanks

[BoatGuy2019]

1st two Nauti’s... we put 70% down cash and then had a payment of no more than $250/month. That’s an easy payment for our household no matter the economics or boat boarded for the winter. New boat coming this way, I wanted to do the same thing... wife was adamant about oui g cash as she hates monthly payments. Dave Ramsey style is a good style to live I suppose.


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[idahosan]

I’d rather have 200k sitting in my bank account. Make payments, upgrade every 3-4 years. Enjoy it. Times are tough, sell it. Payments go away. Not that difficult.

This! We have traded up 3 times in the last 8 years and yes we spend/lose money each time but I have yet to meet someone who buys these toys new and actually makes or breaks even. We consider it part of the cost of being on the water and making memories. I will say we have alway put substantial down payments to reduce the monthly payment and allow easy sale if economy drops. I make a good living and honestly making small payments and investing large sums seems to make more sense than dropping a years worth of investments and getting no return in this economy. Everyone should do what makes sense for them and their situation.