So You Think You Want to Buy a Boat?
Many people have dreams of boat ownership and some of them make those dreams a reality. However, some cautious would-be boat owners have held off on that purchase due mainly to the fact that the purchase of a boat can be a huge undertaking.
However, if you’re ready to take the plunge there are a few questions that you should ask yourself before handing over your hard earned cash or signing your name on the boat loan dotted line. Boat ownership may not be for everyone, and it’s wise to learn beforehand if you have the time and money required to keep a boat in ship shape.
We’ll help you answer a few questions that are designed to help you learn more about boat ownership, what types of boats may be right for you, and how to fund the vessel of your dreams.
What Type of Boat is Best?
There are many different types of boats available today and it may be difficult to decide which one suits your needs. Are you looking for a fishing boat? Do you prefer a sailboat over a boat with a motor? Is waterskiing something that you enjoy?
The best way to decide what type of boat is best for you is to think about what you’ll be doing with it. If you live in the American Midwest and plan to take your boat to the lake for fishing then you’ll need a very different boat than the guy who lives in San Diego and wants to sail to Catalina Island. Additionally, if you simply want a boat for leisurely cruising you’ll need something different than those listed above.
Size is an issue as well. You’ll need to consider the type of trailer you’ll need to tow the boat, as well as the vehicle used for the towing. Also, the bigger the boat, the bigger the engine, which ultimately leads to a bigger a fuel bill.
New or Used?
Once you’ve decided on the type of boat you’d like, the next question is typically whether to look at new or used models. There are advantages and disadvantages to both, but these usually come to down to price in the end,
If you purchase a new boat you have the advantage of visiting several dealers and becoming more familiar with the models available. Boat shows are also great places to get more information on various types of new boats and learn more about the prices. Another perk to purchasing a new model is the fact that manufacturer’s warranties are in place and will help protect your investment from costly repairs.
On the other hand, now is the perfect time to shop for a used boat. Tough economic times mean that luxuries are the first to go, and this often includes boats with a great deal of life left in them. However, when you’re shopping for a used boat you’ll want to be sure that you’ve done your homework. You’ll need to inspect the boat inside and out for signs of damage or wear. If you don’t feel that you’re capable of accurately performing that task it’s wise to enlist the help of a knowledgeable friend or a professional boat appraiser.
How to Pay for It?
Everything always comes down to money and this is doubly true when speaking of a boat. Boats can be costly investments and that cost will affect your budget long after the purchase is made.
Prospective boat owners generally have two purchase options: purchasing with cash or taking a loan to finalize the sale. Many new boat dealers offer in-house financing and most banks and credit unions can assist borrowers with boat loans.
If you’d rather not take a loan and prefer to pay cash for your boat, there’s the matter of the budget. You’ll need to save money for the purchase as you would any other. Some boat owners have used unique methods to save for their purchase, and many have donated their old boats to charity in preparation for the new purchase. While this doesn’t necessarily give you cash in hand, the donation of an old boat often results in a tax deduction, which can be a relative windfall if you anticipate paying a tax penalty. The money that you’ve saved can then go to your new boat.
Once the purchase is made the expense doesn’t stop there. You’ll need to factor in maintenance costs, mooring fees, fuel costs, and the repairs that your boat will need. It’s wise to have an estimate of these costs before you plan your budget.
After you’ve made that important decision to buy a boat you have a lot to look forward to. The best part is the abundance of great experiences and memories that you’ll have on the water. Bon Voyage!
Category: Family Finances
