How can you afford to Borrow money for a boat ?

I never had any of you lots problems. I started saving when I was very young. 30 shillings saving certificates. When ever I wanted anything. Motor bike was the first thing, I just bought it for cash. £30. Yep my mates bought new honda's, but I was very proud of my Matchless 500.

My cars ten years old and the boat nearly twenty. I could have a new one of each tomorrow. Because I saved the cash and got interest, instead of paying interest to others.

But I dont need a new car. The one I have works just fine and the boat would not float any better if it was brand new.

In the mean time, I have even more dosh in the bank, cos of all the interest I've saved. In fact I dont even have to bother going to work.
 
Income = Expenditure Is Happiness
Income > Expenditure Is a lot of Happiness
Income < Expenditure is a heart attack waiting to happen.

It is a thin line but from the sound of it one which most people are happy to tread.

Lets hope I continue to tread Carefully! /forums/images/graemlins/smile.gif
 
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DAKA you are very lucky to be able to afford all of your stuff cash - you are would have to say in a very small minority.

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It is not luck, it is achieved by going with out until you can afford it.
The majority here can afford a boat with out finance, it just might not be the one they want right now.

My boat is not a mega yacht and looks tatty at the side of some, I could finance a newer larger one but I exercise restraint and put up with what I have.
 
Haydn,

That is commendable and is what my Parents and their Parents did. My parents late 50's/early 60s own House and car and boat here and house and car in Spain. But to do this they have written off 14 years of their life after I left home (at 18 because I am thoughtful) to be able to afford it but are now retired. The question I ask is why not have enjoyed that period and retired 2 years later? They are happy, but sometimes feel they have missed something out.

Cheers

Paul /forums/images/graemlins/smile.gif
 
No Jez not anymore. Last one I had was over 15yrs cause just wanted to pay it up asap. Did not mind a mortgage as it was a apreciating asset, but I could never buy a car, boat or anything else on the strap. Everyone is different & what suits me may not suit others its just how I am.
Anyhow you know how I deal.Ive been like that all my life & probally will never change
regards Nat
 
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Paid it off early by living with cheap furniture and running around in an old Mini . /forums/images/graemlins/cool.gif

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Which is admirable, and I am putting investments in place to be able to do the same (I hope).

BUt against your own advice, you did borrow money for your house at some point then?
 
Ok - take a mortgage then ....

10 years ago - £50k house, sold 4 years later for £80k ...
Mortgage on £50k house - £500/month = £6kpa

6k pa * 4 years = £24k - so basically rent free living for 4 years and £6k in your pocket (25% interest!!)

To save up that £50k to start with (@£500pm) would take 8 years, by which time the house now costs £120k .... Doh.

I'm quite happy for someone else to buy me a house with their cash if they want to though! /forums/images/graemlins/laugh.gif
 
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No just trying to educate and save the country from huge debts, if you @@@@@@ havent any savings ready for Gordon I fear...........

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i was fortunate to have pension arrangements with Standard Life.
So when they went public, they gave lots of people some shares.
They are just about to pay the first dividend @ 5.4p per share.

Now uncle Gordy loves getting some extra dosh and dont give a monkeys toss where.
so that 5.4p per share will be rduced to 3.28p per share!

whats the point in saving.
you go to work and get some hard earned dosh.
Gordy says thank you very much Mr 3 bottles i will have a big chunk of that.
put it in the bank and save it. the bank says thank you mr 3 bottles heres some interest on what you gave us.
goody goody

No that greedy bastrd Gordy comes along and says you cant have all that and swipes another effin big chunk.


But back to your original argument.
I have all my holidays on the boat now so the interest i pay on the loan is not a lot more than i would pay for flight and hotel room in some grotty foreign flee ridden resort. i can go pretty much where i like when i like. and will still have something left in 10 years with some sort of value.
 
I borrowed for my boat. Although it was expensive to do so if I had waited 10 years I would have lost 10 years of experiences and enjoyment that I had when I was younger. Borrowing enabled me to buy a new boat that allowed me to focus on work and earning and using the boat rather than working on a project. Being self employed I had a different view of the finance as I had to fund the business as well as my own life, the marine mortgage enabled the money to be secured on something that wasn't already in the businesses fold. I was highly geared at the time with lots of earnings, I wouldn't be able to buy a decent boat now.
 
Fireball,

You are my type of guy! That is how I see it. For Instance, in 2002 looked at buying an Sealine S28 at £79,500. I did not buy it. Now the same boat is about £70,000 secondhand so would have lost £10k depreciation plus finance and repayment costs of £41,340. Total cost of £51k. If I now bought a new S29 it would cost me £130k, so if I had saved up the money I would be in a similar position (£50k difference) but not have had boat for 5 years so go figure????

Nope I should have bought the S28 but I tried to save up and have a cheaper boat. SWMBO spent savings on new house and I am back to square one where new boat prices have increased 65% and I can only finance one now!

Cheers

Paul /forums/images/graemlins/cool.gif
 
I was forced to borrow to buy my house as it formed part of my business but that is a long story I will bore you with should we meet.
In the mean time it is a little unfair to start to mix Home mortgages which in the long term will be an appreciating asset as apposed to a boat which is a depreciating extravagant toy.
 
Good Point Daka,

Home is always seperate even though the temptation to re-mortgage to afford a bigger boat is there and more sensible.

Home Loan (mortgage) should be taken out of the equation IMHO.

All other debt should be considered,

Cheers

Paul /forums/images/graemlins/cool.gif
 
I could be wrong but in simple terms

Someone who thinks they can afford £125 k on finance will pay £1125 month (total £135000 over 10 years @8% APR).

If I was in that position I would wait 5 years and save the £67500.
Then use that to buy a boat, if Gludy is right and prices fall the £125 000 boat will be affordable with out finance.

Saving £67500

Thats half price !
Which is what I have always worked by as a rule of thumb, pay on finance and pay double.
 
I'm with the "Enjoy it now" brigade!

Last year I sold off my 4000 Euro speedboat and resolved not to buy another boat until I could afford to run it. I would have liked a bigger boat to match the expanding family so I said I'd hold off.

Then in the space of four weeks 5 people dropped dead around the age of 35! I'm 33. Sod it, says I! Having come accross a type of boat that would suit us I went to the Credit union, got the money and bought the boat. We've put sixty hours on her since we got her last August ( And that's with having her out of the water for a month).

While I wouldn't consider a new boat on a large morgage/loan (SWMBO fancies an ISIS from CarrickCraft) I would have no problem on Financing a boat that's done its depreciation.

Swings and roundabouts I guess!.

J.
 
Round and Round we go .............. /forums/images/graemlins/laugh.gif

DAKA your point about the depreciation and saving is well put - and if people wanted to waste 5 years of their life they would be advised to take your valid comments to heart - but as previously mentioned in the real world people just are not like that - you see something you want and do the maths - which is normally can I afford the finance and have it now ... sod the future if its within affordability then BANG! andthe deal is done ...

Alternatively I guess one could take your advice - take up knitting and then when you have 10,000 jumpers - have the cash to go buy the boat that you wanted 5 years ago - (I guesss in the meantime you have been sitting in the Marina Bar looking out of the window longingly at all those people that were queuing up for their boats when you were and have got them on finance and having a whale of a time - whilst you have been knitting though ...

sorry I stand by my decision to get the boat I wanted when I wanted - and forget that I am giving the mortgage company 8% - after all its just another tax and forgetting this 73% of everyones earnings go to Mr Brown anyway - but with this tax at least I have something to enjoy and show for it!
 
I think you summarised well and it has helped me see the bigger picture, just for the record though I wouldnt take up knitting but a small older Petrol Bayliner can be used as an enjoyable trainer /forums/images/graemlins/smile.gif
 
Ok - well if you have sufficient income to be able to put away 1200 per month into savings then perhaps you should've started saving 5 years ago and buy a different older boat now ...

Unfortunately circumstances change so you'd probably find something else to put your 1200/month to (nice holidays, new car, home improvements) so it'll actually take you nearer 10 years to save the 60k you needed - by which time your preferences will have changed and you'll no longer be satisfied with the 60k boat and want a 120k boat ...

Personally - I agree with the "can I afford it now" brigade ... do the maths - and if you feel the investment is worth the expenditure then go for it - we'll have an extra 10 years of enjoying the boat whilst you sit at home in the dark being a grumpy old git! /forums/images/graemlins/tongue.gif
 
Sorry, but its more complex than that-you have to discount all the cashflows for a start. Then you have two seperate propositions that arent comparable. You have to define a level of depreciation and you need to put a financial value on the first 5 years of ownership in case 1. The latter might well be the difference between the loss of investment,plus depreciation, plus some "happiness" premium.
OK, if you do that, maybe you never buy a a boat , but I am merely saying that your simple example doesnt make much sense.Otherwise your argument is simply that I earn 5pct in the bank, and dont earn interest on a boat, so its a better deal not to have a boat today, but have one later. Well, yes, of course! Even better, financially, never to have one !! But then, thats not the idea.
 
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