What Does Everyone DO ?

[beachbum]

I drive a truck and I'm 52, I purchased a Ericson 27 that needed work and I will be putting about 10K into it. Will be taking about 4 months a year and sailing south from Texas. Dec to Apr. every year.

[Gator81]

I'm a forester. US Forest Service, 24 years. I've been saving at least 10% of my income from the beginning, always invested in stocks (the US federal employee's version of a 401(k), called the "Thrift Savings Plan") which is matched 5%. Every time I've ever gotten a promotion, I've bumped up the contribution. I'm now at 18%. A divorce 10 years ago was a big setback. My wife of 6 years now (a bank manager) makes a good income and kicks into her 401(k) at 15% with 5% matching. So we are on track to make our goal: A FP Belize 43 (or the equivalent at the time!) in 8 years. We are thrifty people. I drive a 13 year old used truck. We bought a derelict house and spent the last 6 years remodeling. We probably only go out to dinner 2 or 3 times a year, because we'd rather be home cooking together, or sharing a bottle of wine while we wait for the pizza!

[Charlie]

Re read the entire thread and had to reply to the comment "No offence, but "good debt" is an oxymoron (mostly moron)."

No offence taken but just to educate anyone willing to listen.


In Real Estate the more you leverage the more you make (or lose). In the 90's and the first two years of this century I found apartments where I could put down 25% cover all expenses (including vacancy) and service the "good debt" and then get a 6% to 10% return on the downpayment. Yes when I bought 75% of the value of the apartments were owned by the bank but I was using their money and still making a good return on the down payment. When the RE mkt went crazy around 2001 or 2002 I saw the good side of leverage. RE values went up 200% to 400% so I had building where I had more equity than debt. The bank had loaned me the money but I got all the increase in value. I carefully bought more buildings by refinaincing the original ones. The key was buying RE as a business not the latest investment fad.

It was b/c of debt that I was able to purchase a boat for cash and have a comfortable cruising kitty that grows annually along with rents.
I've got a nice house that I could payoff but other investments come along that are better than the 6% or7% return that paying the house off early would produce. Before I go cruising I will pay off the house. But I want it there when I decide to come home. I don't want to sell everything and have to start over if/when I tire of cruising.


So yes there is good debt. Good debt makes you more money than it costs to service the debt. I learned the first bit of this stuff from my father who was a public high school teacher for 40 years. Leverage along with being frugal is a way to keep alot of money.

No offense, Cptn Jeff but please stick to English (my college major) don't try teaching economics (my college minor)

[96 P-23]

I am an Automotive Technician. I choose a sail boat because sailing involves study, skill, research and is aesthetically pleasing.

[Chuteman]

Thought that we all sailed/cruised was the most important fact....the rest does not matter

[svHyLyte]

For my part I'm a 59 year young Real Estate Investment Banker originally trained and licensed as an Architect and Engineer. I gave up my first--but prefered--profession, after realizing that design professionals do most of the work, accept almost all of the liability, and generally make the least of the money, in the real estate development industry.

My wife and I sail a 1986 Beneteau First 42, which is probably too much boat for us but my OAO insists on having two heads (although one is virtually never used); a spare "guest cabin" although--with the exception of a few of my daughter's friends, we've never had a guest aboard--and all of the comforts of home--propane stove, freezer/refer, air conditioning, TV/VCR/DVD, etc., etc. etc. We even have a generator so we can use the AC while on the hook (although we've never actually done so as its not been necessary and who would want to have the boat all closed up any way?).

We bought the boat after 9/11. Until then we had a 1976 Cal 2-29, fully paid for years earlier, that was in perfect condition (having just completed a $20,00+ renovation the previous June). The first person that looked at the Cal bought her at essentially our asking price--which was far more than any Cal 29 had sold for in years. We bought the bigger boat becuase we'd been talking about it for 20 years and 9/11 made us realize that one just never knows how long one might have to enjoy something so some things are better not deferred.

We could have paid cash for the "new" old boat but it didn't make sense to tie up that much money in a non-producing asset.

The debate about debt is an interesting one. Debt for the sake of consumption, only, is foolish and self defeating--"Dumb Debt". It generally results in people paying far more for something than it's worth, and particularly so if the debt is incurred with a credit card--the bane of the working class. (Credit card issuers understand that most people are sufficiently honest that they will try to repay their debts, no matter how large. They also understand that given credit, most people cannot refrain from impulsive spending, particularly if the amounts involved, individually, are not so great. What's the harm in a few $15.00 DVD's? But the little, impulsive, purchases add up, quickly. And honest John Q. Public labors mightily to repay the resulting debt--at 20% plus interest.) I may be in debt up to my ears, but we have no credit card debt what-so-ever, and what debt I have is earning much more than it costs.

We use debt--and loan money to people who use it--to earn more than the debt costs. If I can borrow at 8% for an investment that yields more than 8%, I make the spread on every dollar I borrow. And I can generally borrow--or am willing to lend--$3 for every $1 of my own or that a borrower is prepared to invest in something that makes money, provided that the security for the loan is worth more than the debt. In fact, we joke about borrowing from the poor--the teacher that keeps his money safely in the bank--and loaning to the rich, becuase the rich almose always pay us back and the poor don't really expect much for their money.

In the case of our boat, the interest on the debt we used to buy it is less than the return I earn on the money I didn't spend so, for all intents and purposes, that part of the boat was "free". And the times we've had aboard as a family have been priceless.

Cheers,

s/v HyLyte

[Gallivanters]

I got out of the US Navy 27 years ago as a Deep Sea Diver / Aviation Structural Mechanic and bought my first sailboat shortly thereafter. I've been working on boats ever since - Deckhand, Bartender, Engineer, Captain and Submersible Pilot... and I learned how to sew canvas, too.

I abandoned and swam away from my "career" in small submarines to sail around the world in 1995. I've supported myself since then by driving boats, hard hat diving and sail repairs. Whenever I needed money - I'd simply stop and work a while. Finding work is never a problem so long as you're honest and willing to work hard and share what you know.

I left Hawaii in 1995 with Zero Debt. I had a 37 ft boat, a Thousand Dollars in the bank and a boat job waiting for me in Saipan - 3500 miles west. Saipan kinda sucked and I had the urge to keep sailing...

Since then I've lived and worked in Guam, Australia, Papua New Guinea, Malaysia, Cyprus, Malta, the Canaries and now the Caribbean. I've also gotten married, bought a bigger boat and a now have a three year old son.

And I still have that Thousand Dollars in the bank.

The point I'm trying to make is that one can live profitably while out meandering around this watery world we're visiting, just so long as you don't get trapped in the quest for material "wealth".

To the best of my knowledge, you only live once... so you shouldn't short-change yourself.

Kirk

[yotphix]

I have a new plan that seems to have me on track. I don't have a home, a car, or really much of anything except a little hughes25 that I live on when I get home. Instead I work on a ridiculously large private yacht as an engineer, live aboard, eat free and have everything covered right down to toothpaste. I don't go out and apart from the odd airline ticket and hotel room I can bank almost my entire income. After five years, during which I will purchase a rental property, I should be able to afford a great boat, outfit it and sail away. Meantime I'm on the water every day and traveling to cruising destinations regularly. No sails but hey...they're paying me!

[seafox]

what's a hughes 25 Yotphix?

[Canibul]

I am refining my "dreams" as I go. Information that I have received from this and other forums has proven very valuable to me. I am still looking for the 'right' boat to fit needs and resources, but in the meantime I am going to get involved in bareboat chartering a few times as a logical next step. Intellectually/academically I now know a lot about cruising boats and the lifestyle. But the longest I have spent on a cruise was a week on a 42 ft. catamaran in the Bahamas. I need more time at sea on this kind of boat as a next step.

I still need a larger powerboat for my day-to-day life in these little islands, and also plan to pick up a Hobie 16 or the equivalent just to play with. Meantime, I am researching the local marinas, the one shipyard, and keeping my eye open for that acceptable boat. I think this all takes a huge amount of patience and time to put together. I can see the potential traps of rushing into spending that kind of money on a boat, without knowing everything I can know. For example, I wouldnt have even thought of hiring a survey six months ago. i would have just gone over a boat myself, and plunked down a hundred grand. Not now.

inboard, outboard, rig, sails, keels vs. boards, galley up/down, solar/genny, solid FRP or cores, folding props, etc etc. Theres a lot involved.

[never monday]

I turn lemons into lemon aide. Having a marine business helps with expenses, discounts, and write offs too.

1st non trailerable boat. 1980 Hunter 30, It sank in fresh water. Bought for 9k, after another 5is K in rehab and 3 years sold it for 21k.
next
1980 Cheoy Lee 38, sank in fresh water, bought for 35k, 2-3k in rehab and 2 years sold for 42k.
current
1989 SeaRay 340 Sundancer, sank in fresh water. Bought and floating for 15k. I plan another 60k in rehab including a diesel conversion (60k) and selling it in 5 years for around 120-150k

[Canibul]

I used to do that with motorcycles. Buy a basket case and rebuild it, sell for a profit, and buy another, better, basket case.

[Alan Wheeler]

Pat! can't you see a pattern there mate? Boats seem to sink in fresh water. Stay away from fresh water.:-)

[never monday]

Originally Posted by Alan Wheeler

Pat! can't you see a pattern there mate? Boats seem to sink in fresh water. Stay away from fresh water.:-)

Alan,
my brother from another mother, I'd like to extend an invitation to join our little yacht club.

[salty_dog_68]

How do I pay for my boat? One word - OVER TIME. I worked all the extra shifts that I could for about two years (and in the medical field there are plenty of OT shifts available). I have been very fortunate with the job thing since. After I got the boat home I was offered a "weekend-shift" job that pays as much as my prior full-time job but I only work two (yes TWO!) day a week. There are some drawbacks to working every Friday and Saturday but I choose to look at the bright side. I am on the water when all the crowds are at work. I have the waterways, and the dive sites, and the fishing spots, and the anchorages practically to myself while most of you guys are crunching numbers and typing away at keyboards during the week. I will keep the seat warm for you...