Thinking of buying a boat during pandemic – am I CRAZY?

[LazyNihilist]

I'd go for a 650K boat in your situation.

[Ronald Lee]

Get the boat. You will never be able to take it out yesterday when it's too late and they don't depreciate (at least Aluminum boats) as fast as vehicles.

[JaneyLH]

Interesting that you say you and your wife have been going back and forth about buying a boat... but YOU have been wanting one for a long time. A boat purchase and use is something you and your wife should be 100% in agreement on. My husband and I bought a sailboat from a gentleman who had always wanted one... and the wife refused to set foot on it again after one sail. We got it at a substantial discount and loved it for 7 years. That said, it cost way more to maintain than we expected, took way more work than expected, and after a mobility-limiting injury was not an asset but rather a source of worry. The day we sold it was a day of celebration.

[Dave55]

My wife and I have been going back and forth on purchasing a boat. We recently bought a new lakeside house, and I have been wanting a boat for a *long long* time. Am I crazy to think about this given the current economic climate? The boat I’m looking at is listed at 65k, and I’ve been going back and forth on this endlessly.

More details - we have been in progress of remodeling our new house – looking at 50k to finish the remodel, with a potential further kitchen remodel in the fall (150k).

Pros: Life is short, kids growing up. Wanted this for a long time. My projections say I can afford it.
Cons: RECESSION! Given meta-uncertainty plus remodel, isn’t it better to wait until next year?

Other options – smaller boat (with no bathroom),or buy with financing.

Details on my financial situation below:

Senior manager at a mega-tech. Job appears to be stable (of course there’s uncertainty everywhere).
Salary: ~1.2 Million annual. ( 280k base, 150-200k bonus, ~650 k stock that vests over 5 years).
I’m expecting a $140k bonus in September, plus a vesting of $350k stock (post tax) through Sep/Nov.

Fincancial Assets
Vanguard/eTrade/Betterment: 4.05 Million.
Cash : 605k.

Assets
House 1: Value- 2.5 million. Remaining loan balance: 740k.
House 2: Value – 800k, Remaining loan balance: 180k. (House 2 also rents for approx 25k a year, although I'm not expecting much this year).

In general I have been contributing 350k yearly to investment accounts, and 60-80k on paying off principal on loans. My plan is to retire in 5 years, with a projected spend of 200k year. I normally keep 200-300k cash on hand, although this is higher right now due to the pandemic, plus our remodel.

I didn’t want to make this into a portfolio review so appreciate everyone’s focus on the “boat” question.

Thanks

Buy the boat.

Dave

[Dave55]

delete.

[btenny]

Long term 60 years plus boat owner here. I live on a lake and own a 23 foot cruiser with a small cutty cabin for camping and a porta-potty toilet. We use it 15 days or so per year. We do lots of planned all day trips and some spur of the moment wine and sunset cruises. In my case I dock my boat behind my house all summer. I also haul my boat in and out with my Jeep and my wife as a boat mate. It is a big hard chore and expensive to get it shrink wrapped for winter and towed to the boat shop and then to the rental yard. I spend $2K or so per year for various things like storage, boat fees, repairs, insurance, etc.. My friend has a 32 footer. He spends $8K or so and owns his winter storage room. He hires out all the in and out tasks and that is a scheduling chore.

Yes you can afford a nice boat. Choose the kind of boat you buy carefully. What type of boat to buy should be based on your use plan. How will your kids fit into your use plan? Do you need to take 8 people and ski/wake board all day? Do you need a wake boat setup so your kids can surf behind the boat? Or are you cruiser person? Do you fish? What kind of fishing? Do you boat camp overnight? Think about the trade offs. $65K is not that expensive for a nice boat with some nice features. I also recommend you buy a boat with a porta-potty toilet. They are easier to use and less trouble to take care of than the pump out models. Most 22 foot and larger boats of all types have some sort of toilet setup.

Good Luck.

[tibbitts]

do you think now that you live on the lake and can see the water from your patio or deck or whatever, you might lose some of the desire to be actually on the water?

also, do you think the tradeoff of owning vs renting the boat will actually be more convenient? it sounds like renting is a hassle because of the reservation system but owning means you have to organize all the maintenance, and there will still be times when your boat is not available for a spontaneous outing.

When you have a house on a lake you use the boat almost daily when you're at the house - usually multiple times per day.

[2pedals]

We recently bought a new lakeside house, and I have been wanting a boat for a *long long* time.
<---- snip ---->
Life is short, kids growing up. Wanted this for a long time.
<---- snip ---->

No you should not be buying a boat. You should be buying boats.

I would get a daysailor, a row boat, a runabout, two jet skis, and kayaks.

[phxjcc]

MISTAKE!!!!

Buy a 50-60 ft C&C.

Nicely equipped, $200k.

Did I mention that I could arrange to bring it to you?

[Golfalot]

Buy the boat. I was in a similar boat as you last year (no pun intended). My wife grew up on water and had been bugging me about getting a boat for years. I grew up as a golfer and wasn't much of a boater. I finally caved last spring and I am so glad I did. It has been a lot of fun to have a boat. We have a couple teenagers and the boat has been an excellent way to have some good family time. It is tough to financially justify, but great way to have fun and build memories......and $65k with your existing assets & income level is nothing.

[bltn]

Interesting that you say you and your wife have been going back and forth about buying a boat... but YOU have been wanting one for a long time. A boat purchase and use is something you and your wife should be 100% in agreement on. My husband and I bought a sailboat from a gentleman who had always wanted one... and the wife refused to set foot on it again after one sail. We got it at a substantial discount and loved it for 7 years. That said, it cost way more to maintain than we expected, took way more work than expected, and after a mobility-limiting injury was not an asset but rather a source of worry. The day we sold it was a day of celebration.

Interesting perspective.

[boglethat]

You can easily afford it and in these times when we should not be going out to crowded restaurants, concerts, bars etc. you and your family can take the boat out provided it is allowed. In any case, with so much reopening it should be allowed soon but still safer IMHO that a lot of other activities that used to make life fun. It will be good to do something that isn't online. As someone mentioned, the size should be related to the lake size. I thought the porta potty was something to consider. Water skiing is a fun family activity. Make sure your kids know how to swim.

[inbox788]

Buy one... I only ask it’s from a company in the s&p 500. We have earnings to pump up!

Don't let that requirement stop you. Even if the boat isn't made by an SP500 company, there are plenty of parts and support you'll need that help SP500 companies. You'll be buying more gas (both for your boat and getting to your boat), so helping CVX and XOM, not to mention heating or cooling your cabin, helping other energy companies. You might be financing, so C or WFC may benefit, and you'll need some sort of insurance too. If you looked deep enough, you'd be amazed how many materials and chemicals go into the boat, and are provided by companies like DD and MMM. And you will wash and paint your boat sometimes. And don't forget all the radios and fancy new electronics you'll be bring onboard or installing. And there's all that processed food and drink you'll be consuming on the boat (TGT, WMT, SBUX, CLX, KO, CAG, KHC). Anyway, enjoy your boat(s) and if it will help rationalize your purchase, you'll be helping to support the economy in a many ways.

https://www.3m.com/3M/en_US/marine-us/
http://bluewatersupply.com/BoatBuildingMaterials.aspx

BTW, which other SP500 companies actually build boats? I couldn't easily associate boat brand with a major corporations.

https://en.wikipedia.org/wiki/Brunswick_Corporation [BC Bruinswick Bayliner midcap SP400]
https://forestriverinc.com/Our-Products/Pontoon-Boats [BRK]
https://en.wikipedia.org/wiki/Malibu_Boats [MBUU Cobalt Malibu Russell 2000]

[LeftCoastIV]

Thanks all ! FWIW - I am in a boat club and have been the past few years. It's been good but has drawbacks -- namely you need to reserve ahead of time and you can never be spontaneous about just taking it out for a spin. The boat club has made me want to be an owner even more.

It is good food for thought if I need that much boat. The main thing driving the price is a desire for a marine head.

Thanks again all...

We are going through a similar deliberation (although would need to moor the boat at a marina), and are leaning towards the boat club. In my neck of the woods, Freedom Boat Club wants $5K up-front and ~$350 per month. Spending $5K up-front and not getting any equity in anything is tough to swallow, but the math works out much better than buying a depreciated asset.

Also, if I bought a boat, I would probably realize I wanted a slightly different boat once I purchased the first one, and then I would be on the treadmill...

[wfrobinette]

Generally buying a boat is a bad idea, and the saying I've heard is: The best two days of a boat owners life are the day he buys the boat, and the day he sells the boat.

That being said, as long as you don't buy anything too extravagant, it shouldn't make a hill of beans difference in the long run for you.

I think that quote doesn't apply to someone who lives on a lake.

[avenger]

Do it. Buyer’s market.

We got rid of ours right before the pandemic!

We made some of our favorite memories in the past decade on that boat.

We live in Chicago. Was always fun to take friends down the Chicago river downtown

[HomerJ]

If you can't figure out the answer to this question on your own, your mega-tech company should fire you for being incompetent.

Get two jetskis too.

[LadyGeek]

This forum maintains a family-friendly environment - things you can say in front of the little ones.

I removed a post and reply which linked to a book review containing language above our family-friendly threshold.

Also, please stay on-topic - Helping the OP decide if he should buy a boat (financial aspects).

[PerfecTiming]

Buy the boat. You can easily afford it and will enjoy it. Life is short. And if not, then you can always sell it.

PS- You should also buy two jet skis to pair with it.

[Wricha]

$65k for a boat is a relatively modest expense given your income. How big is the lake overnight trips? I would bet 2 houses and boat with kids will be a tight budget on $200k I might rethink that budget a bit.

[cherijoh]

My wife and I have been going back and forth on purchasing a boat. We recently bought a new lakeside house, and I have been wanting a boat for a *long long* time. Am I crazy to think about this given the current economic climate? The boat I’m looking at is listed at 65k, and I’ve been going back and forth on this endlessly.

More details - we have been in progress of remodeling our new house – looking at 50k to finish the remodel, with a potential further kitchen remodel in the fall (150k).

Pros: Life is short, kids growing up. Wanted this for a long time. My projections say I can afford it.
Cons: RECESSION! Given meta-uncertainty plus remodel, isn’t it better to wait until next year?

Other options – smaller boat (with no bathroom),or buy with financing.

Details on my financial situation below:

Senior manager at a mega-tech. Job appears to be stable (of course there’s uncertainty everywhere).
Salary: ~1.2 Million annual. ( 280k base, 150-200k bonus, ~650 k stock that vests over 5 years).
I’m expecting a $140k bonus in September, plus a vesting of $350k stock (post tax) through Sep/Nov.

Fincancial Assets
Vanguard/eTrade/Betterment: 4.05 Million.
Cash : 605k.

Assets
House 1: Value- 2.5 million. Remaining loan balance: 740k.
House 2: Value – 800k, Remaining loan balance: 180k. (House 2 also rents for approx 25k a year, although I'm not expecting much this year).

In general I have been contributing 350k yearly to investment accounts, and 60-80k on paying off principal on loans. My plan is to retire in 5 years, with a projected spend of 200k year. I normally keep 200-300k cash on hand, although this is higher right now due to the pandemic, plus our remodel.

I didn’t want to make this into a portfolio review so appreciate everyone’s focus on the “boat” question.

Thanks

Will you have time to use the boat this summer with the remodel ongoing? How confident are you on your renovation budget? Almost everyone I know who did a major remodel was way off on what it would cost.

I'm not a boat person, so some of these questions may be unimportant but is this a boat you would store somewhere else or you would keep on the lake at your place? Or keep on dry land at your place? If you would be responsible for transporting it to the boat jetty, do you have a vehicle capable of hauling it? If it is stored somewhere, how much is the storage?

How big is the boat relative to the size of the lake? As others pointed out, if it takes 10 minutes to get to the other side of the lake you will be like a kid riding his bike up and down the street multiple times. You might be better off getting a smaller boat and renting a bigger one if you have a longer trip planned where an on-board head is a necessity.

How confident are you about your bonus and stock vesting? We are living in a new world and if you were forced to live primarily off your base pay, it wouldn't be a good time to incur additional ongoing expenses.

[HomerJ]

I'm not a boat person, so some of these questions may be unimportant but is this a boat you would store somewhere else or you would keep on the lake at your place? Or keep on dry land at your place? If you would be responsible for transporting it to the boat jetty, do you have a vehicle capable of hauling it? If it is stored somewhere, how much is the storage?

It sounds like they have a dock and a lift.

We own a boat and lift at our lake house (just a condo).

There is ZERO chance I would own a boat if I had to haul it to the lake every weekend, and take it out and store it every winter.

It sits on its lift all year round... We drive down in the spring-summer-fall, walk down to the dock, and we're out on the water with no fuss no muss in 5 minutes.

[beernutz]

You are likely in the top 1% of net worths in the US and you are stressing over a $65k purchase? Times really are tough all over.

My net worth is less than half yours and I paid cash for a $50k boat and a $23k covered boat lift. YOLO.

[fallingeggs]

Goodness. Buy the boat! They are fun.

[arcticpineapplecorp.]

my girlfriend just saw this post about a guy who was alone on his boat for the past 3 months and didn't realize a pandemic was going on. Now THAT's CRAZY!!

https://www.google.com/search?client=fi ... ths+at+sea

[rustymutt]

I don't think so. But in fairness to you, I'm looking at fishing boats myself. And I'll purchase when I fine the right used boat. Hard to do here with a brisk junk boat business on Craigslist. I saw a 2019 Lund 1875 with everything I want, but $39000. Plus tax, and insurance. Maintenance, and upkeep.
I can hire lots of guides for that. And they clean the fish, and pack it on ice. Hope my 25 cent helps you decide.

[rustymutt]

my girlfriend just saw this post about a guy who was alone on his boat for the past 3 months and didn't realize a pandemic was going on. Now THAT's CRAZY!!

https://www.google.com/search?client=fi ... ths+at+sea

That's wild.

[Big Worm]

For gods sakes man get the boat! No offense but your post is trollish. Of course you can afford it. I would get a tricked out 24 foot Malibu if I were in your shoes!

[capran]

At that income and asset base, why would you not buy a boat? We live on a boat every summer full time (to avoid the expensive waterfront property) and have done so since 1986. My only regret is not buying a nicer boat earlier, and we only made a tiny fraction of what you do. Life is too short to not throw yourself into something that may bring you pleasure.

[goblue100]

You are talking about spending 5% of your annual income. If you made 100,000, would you be ok spending 5,000 on a luxury? If you just don't save your 30,000 a month for two months, its paid for. You have my permission, and my envy. I wish I had your income.
As far as it buying it during a pandemic, if you don't get a good deal I would say you need to work on your negotiation skills.

[Barefoot]

Buy the boat