Need Words of Wisdom on New Purchase

norriscathy · Jun 26, 2015

Have a sales contract pending on a 1984 Sea Ray 260 Express Cruiser with a 2014 Brand new 5.7L 300 hp engine (only 20 hours!). Survey will be next week with sea trial and closing to follow. Need many words of wisdom from the "great ones" !

Norris

bbwhitejr · Jun 26, 2015

sfergson727 said:
Don't think of your boat as an investment or an asset.....ever. (unless you consider it an investment to a better life, longer, more relaxed life, then investment is allowed.)

Best words of wisdom you will ever get!!

Bennett

moparlvr4406 · Jun 26, 2015

stay emotionally detached ... if something doesn't feel right or check out properly ...be prepared to walk away rather than compromise

fwebster · Jun 26, 2015

sfergson727 said:
Don't think of your boat as an investment or an asset.....ever. (unless you consider it an investment to a better life, longer, more relaxed life, then investment is allowed.)

Sorry, but I don't agree with your first sentence.

One should approach boat ownership guided by the same financial principles as you do any other relatively large asset. Granted it is a depreciating asset, and a buyer should factor that in to his decision making processes. An eye on long term depreciated values helps a buyer make smart decisions, but a boat purchase is still buying an asset that can represent a healthy part of ones net worth. How could you not consider it an investment and an asset?

blaster · Jun 26, 2015

fwebster said:
Sorry, but I don't agree with your first sentence.

One should approach boat ownership guided by the same financial principles as you do any other relatively large asset. Granted it is a depreciating asset, and a buyer should factor that in to his decision making processes. An eye on long term depreciated values helps a buyer make smart decisions, but a boat purchase is still buying an asset that can represent a healthy part of ones net worth. How could you not consider it an investment and an asset?

To me an asset is a dividend paying stock, a patent or other intellectual property, anything which generates income.
My home, liability. My cars, liabilities. My boats, big liabilities. They all cost me money.

Getting back to the original subject, I recommend a survey and sea trial before handing over the cash.

Craigalan · Jun 26, 2015

For me, its an investment in fun, family time, and teaching my boys about boating/fishing/swimming/ecology/dedication. Its a guarnteed loss of money, so calling it an investment is a tough sell. But, its worth every penny!! IMO.

fwebster · Jun 27, 2015

My point is simply this: Even though a boat isn't an income producing asset, it is still an asset and the decision to buy one should be guided by the same level of financial scrutiny as one applies to any sizable asset.

To just blithely say "A boat is not an asset and isn't an investment" is akin to hiding your head under the covers when it thunders.

For most of us our homes and our boats represent the majority of our net worth, yet because they cost you $$ to maintain they are not assets?? What planet are you guys on?

BritLady · Jun 27, 2015

LOL, you guys

We all know that boats cost an arm and a leg to buy and maintain but most of us do that because it's our hobby and we love it. However, now the accountant in me is surfacing

When and if ever a bank requires a personal financial statement from you, your boat will be listed as an asset and guesstimated FMV (with some backup) and such, if any, loan you have on it is listed as a liability. So......unless you are "upside down" on any financing, technically, she's an asset. And, don't forget if you have cooking and sleeping facilities onboard, such, if any, loan interest is also tax deductible too. So it's not all bad

Plus you gotta spend your money and time on something

Pleased the OP is getting a survey, good luck, enjoy and welcome to the "Hole in the Water Club"!

NorCal Boater · Jun 27, 2015

I tend to agree with Frank here. I consider my boats as assets and the value of the asset can remain high or plummet depending on well I look after my assets. By practicing a good PM and maintenance program for your assets you can, in my opinion, maintain a higher value for that asset.

NorCal Boater · Jun 27, 2015

As for wisdom for the OP you have already shown significant wisdom by having the survey. It's amazing how many people invest thousands of dollars on an asset without getting as much information as possible before making the investment.

Keep making these kinds of decisions with the wisdom you are showing and you'll be fine. Remember to have fun and be safe.

Robf · Jun 27, 2015

all
I will have to say as an accountant, a boat or car is not any kind of investment. (absent the comment about investment in family time) It is something we choose to spend money on for fun! A boat will always lose value faster than it can be paid off, unless you can pay cash! Never buy new!! (and I have in the past)

Buy what you can afford, and don't overextend!

Rob

BritLady said:
LOL, you guys We all know that boats cost an arm and a leg to buy and maintain but most of us do that because it's our hobby and we love it. However, now the accountant in me is surfacing When and if ever a bank requires a personal financial statement from you, your boat will be listed as an asset and guesstimated FMV (with some backup) and such, if any, loan you have on it is listed as a liability. So......unless you are "upside down" on any financing, technically, she's an asset. And, don't forget if you have cooking and sleeping facilities onboard, such, if any, loan interest is also tax deductible too. So it's not all bad

Plus you gotta spend your money and time on something

Pleased the OP is getting a survey, good luck, enjoy and welcome to the "Hole in the Water Club"!

Craigalan · Jun 27, 2015

Last night we made BBQ shrimp on board, fished off the back with the kids, then cruised around the bay for about an hour with lifelong friends, who then offered to fill our gas tank. Now thats my kind of investment!

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fwebster · Jun 27, 2015

So you guys are saying the following never entered your mind when you bought your boat:

future value at various ages
demand for your boat model
the engine configuration and how it affects demand and future value
Whether or not your boat bass limited following because of regionally
How much of your money could you get back if you had to sell and get out of boating for some unforeseen reason

Now I completely "get" than a boat isn't an investment like a stock or bond, that they seldom increase in value and they do cost money to maintain. Boating is an investment in life style and for most of us represents a sizable asset. I just think the more conservative financial approach is to consider it more thoroughly than just assuming your boat to be a total loss when you acquire it.

ziekman · Jun 27, 2015

Norris,

Sorry you sparked more of an argument, than words of wisdom you initially sought. Good thing you didn't post this in the middle of winter, LOL. Sometimes the debates are healthy and quite educational, so all good.

My words of wisdom are safety, maintenance and have fun. If you don't have the first 2, you won't have the fun.

SloBurn · Jun 27, 2015

Aside from the money part of owning a boat, I tell my friends who are buying boat "You have to like working on it"! You must be familiar with most of the mechanical aspects of it, otherwise you will not be happy owning one. Reasoning is that if you have any problems with it, YOU are the first line of support. If you have to depend on marinas and mechanics to handle everything, you will hate the boat!
Mechanics aside, you'll also have the pride in keeping her clean and good looking, well running, and being a pleasurable experience for you, your family, and friends.

Gofirstclass · Jun 27, 2015

Robf said:
all
I will have to say as an accountant, a boat or car is not any kind of investment. (absent the comment about investment in family time) It is something we choose to spend money on for fun! A boat will always lose value faster than it can be paid off, unless you can pay cash! Never buy new!! (and I have in the past)

Buy what you can afford, and don't overextend!

Rob

Rob, remember the line "Never say Never"?

I just had an insurance survey done on my boat a month or so ago. As part of the survey, the surveyor affixed a FMV to my boat. His FMV was just a tad over $100,000 more than what I paid for my boat.

Now, that being said, several things worked in my favor when I bought it:
-I bought it in Jan, 2010
-I bought it in the Detroit area where they were still suffering from 35% unemployment
-I negotiated hard and bought it cheap

Never say Never.

Craigalan · Jun 27, 2015

Frank has some very valid points. We were originally set on a Regal Commodore. But, in investigating our regional market, I discovered that this is Sea Ray land, and resale on Sea Ray's was abundant and fair market. It was definitely part of our decision. Not to mention sea ray's superior cockpit layout and all around sleekness.

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NaughtyDog · Jun 27, 2015

Make sure your survey includes a good mechanical and maybe have them double check the leg. Definitely pull it off and have a good look. A brand new 5.7l pushing and old tired leg might spell trouble. Good luck in your purchase! And I hope your new 'asset' prove to be a great 'family investment'. lol
And welcome to CSR!!!

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Mike Blake · Jun 27, 2015

I just made the popcorn, started the Honda to run the fridge for the beers.................................

norriscathy · Jun 28, 2015

NaughtyDog said:
Make sure your survey includes a good mechanical and maybe have them double check the leg. Definitely pull it off and have a good look. A brand new 5.7l pushing and old tired leg might spell trouble. Good luck in your purchase! And I hope your new 'asset' prove to be a great 'family investment'. lol
And welcome to CSR!!!

Sent from my iPhone using Tapatalk

Thanks for the info! The stern drive was replaced in 2013. Unless something shows up in the survey I feel I've got a boat that should provide years of enjoyment for my family.

Norris

Need Words of Wisdom on New Purchase

norriscathy

bbwhitejr

moparlvr4406

fwebster

blaster

Craigalan

fwebster

BritLady

NorCal Boater

NorCal Boater

Robf

Craigalan

fwebster

ziekman

SloBurn

Gofirstclass

Craigalan

NaughtyDog

Mike Blake

norriscathy

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