Financial advice for rookie?

[Roy-c]

To spend $700K or refinance your house when you don't really know if the RV experience is right for you makes no sense at all.
#1. Rent one for a week or better a month.
#2 Talk to a licensed financial planner, don't make a hasty, poorly thought out decision.
#3 I hope you decide that an RV is right for you and we meet on the road somewhere.
Good luck in your quest.

[kenwyatt]

Lot of great points given here. First is you need to get with a pro, also liquidating retirement funds for a depreciating asset is usually a bad idea. Rental until you get a ideal on what it feels like is a great ideal. Talk to a pro that knows your estate and tax situation. Hopefully if it’s done right and you’ll like it and join the pack

[Toby62]

Michael. I’m not going to advise you on finances. My wife and I were going to do the same as you are planning. She had medical conditions and by the time we got close to pulling the trigger her condition declined and we were not able to do it. She passed 2 years ago and we did not get to travel. So please don’t miss out on the opportunity.

[Winemaker2]

Originally Posted by Spdracr39

Get a financial/retirement advisor. Discuss your goals, debts, and assets with him. This is too important to use internet forum advice as everyone's situation is different and can't be applied to you.

Originally Posted by PirateFoxy

With a disability involved, I would try renting a few times first. You can rent different types/floorplans and see what works best for you and therefore where you NEED to spend the money and where you do not. For example, if you find there are specific floorplan elements that really don’t work for you, that may influence the available used options.

Both of above make sense to me given your situation and questions.
Hope it works out for you and yours but you need more help than an internet forum to help you decide what's best.

[happy2rv]

I agree, if you want "sound" financial advice, speak to a professional. Make sure you understand your goals and then they do before advising you. I don't believe there is a "right" or "wrong" decision, especially that applies to every person and situation, but there are informed and uninformed decisions. As much as some may offer their "expertise", no one here knows more than what you've shared about your situation.



Some things to consider, and these are my understanding and opinions, I'm not a financial advisor or a lawyer. My advice might be worth less than you paid for it...



I believe that retirement savings such as 401K and IRA are protected assets meaning they would at least have some protection in the event of financial trouble. I believe this also applies to your primary home. No one likes to think about the most negative possible, but if, heaven forbid, you or your wife's health took a turn for the worse it could wipe out any savings or unprotected assets even with "good" insurance.



We don't know your age, employment circumstances, or personal circumstances other than those described. Many employer's 401K plans have options to take low interest loans against them and the interest pays to your account. If you are young and not planning to retire and have sufficient funds in your 401K, this may be an option without withdrawing funds. Many such loans have to be paid in full or converted to an early withdrawal upon termination of employment. The downside to this is, even if you stay and pay back the loan, you lose the growth that money should have produced in your retirement account.



We also don't know how you've come to your decision about what to buy. Do you have experience with RVs? Do you have enough experience to choose the best layout for your circumstances? Are you basing your decision of diesel vs gas on experience? Are you going to use the RV twice a year, full time, or something in between? If you have done the research and truly know exactly what you're looking for, great. If not, don't think you have to get a million dollar diesel RV to have a livable RV.

I know a couple who special ordered a 5th wheel to get "just what they wanted". Bought a brand new truck, had it outfitted with a hitch and drove half way across the country to pick it up. They signed the papers and stayed in it one night at the dealers lot. THEN decided RV life wasn't for them. They sold it back to the dealer at a considerable loss the next day, drove home, and sold the truck (I'm guessing at a loss). I'm not at all implying this applies to anyone else, just saying, it does happen. Usually not quite so dramatically, but it does happen.


As others have suggested, if you don't have experience with RVs, rent one for a week and take a trip. Learn and make the mistakes on someone else's RV. If you love it and can afford it, then invest in exactly what you want. Make no mistake about it, there are few if any RVs that make decent financial investments. Like boats, they are money pits and will rarely monetarily return anywhere near their cost. However, if you love the lifestyle and if it means you can travel with your wife with a greater degree of safety and freedom, the non-monetary returns can be far more than worth it. They can be priceless.


Growing up we had a Winnebago Brave. It wasn't anything too fancy, but my dad was proud of it. People would sometimes ask what did that cost you? He was always fond of saying absolutely nothing. I was broke when I bought it, I was broke when I finished paying for it. It was obviously tongue in cheek, and about as far from "sound financial" advice as you can get, but IF its what make you happy it doesn't have to be "sound". You can't take it with you, but you do have to live with it while you're here.



My only true financial advice is don't "invest" significantly beyond your means. The quickest way to make it intolerable is to spend so much that you can't keep up the payments, much less the maintenance, registration, insurance, and travel expenses.



The other side of the coin is that for far too many, the old boating adage is true. They say the two happiest days in a boat owners life are the day they get their boat and the day the get rid of their boat...


I wish you the best of luck and hopefully many happy years of RV travel.

[Ray,IN]

Originally Posted by Spdracr39

Get a financial/retirement advisor. Discuss your goals, debts, and assets with him. This is too important to use internet forum advice as everyone's situation is different and can't be applied to you.

The absolute worst thing is to extend one's self to the point of going bankrupt if you lose your job and the stock market tanks again.

[Isaac-1]

Given your situation if you are determined to buy a motorhome, my advice is to buy a 10-12 year old quality brand coach for around $75,000 pay 20% down and finance it over not more than 10 years. Doing so will mean you can likely get out of it for whatever your pay off is, assuming you maintain it and never be upside down. There are a lot of nice older well maintained coaches out there, and if you hunt around a bit you can find banks, credit unions, etc. that will finance coaches up to 12-14 years of age, though finding ones that will finance over the 12 year old point starts getting to be difficult. Note 12 years ago was the beginning of the big economic meltdown of 2008, when a lot of RV manufacturers were going out of business, or just barely hanging on, the result was a lot of junk being pushed out the doors while they were trying to keep the lights on, this includes some then well respected brands, trying to make mix and match stuff from the parts they had on hand, ... Some of those brands are still around, some are not, and some exist today in name only.


See this link of a random example of what about $75,000 - $80,000 buys you on the used upper end quality coach market from a dealer https://www.motorhomesoftexas.com/Pr...98010?ref=list

[catpepper]

How about renting first and see if it fits your lifestyle?

[Jlo11111]

Option 11: pay off your debt, cut your spending by 25%, put away enough cash to live off of for at least 6 months, then revisit whether you really want an RV.

[boomersooner]

I am currently obtaining a Masters Degree in Certified Financial Planning. I can say most of the advice here is pretty much on point, especially the comments about getting with a professional to help map out your financial future since this is a large purchase that will have ramifications across your entire financial spectrum. The one poster who said "to discuss your goals, debts, and assets" was spot on, this is one of the first things a CFP will want from you. I personally would not, and I am sure a CFP would not recommend, the options that involve home equity or touching your retirement funds for a depreciating asset.

Best of luck in your decision, it may be one that affects the rest of your financial life and you most likely only get one chance to get it right.

[jacwjames]

I worked in a very volatile industry, never knew one when you'd loose your job, just knew at some point it would happen. Over the years I have given my subordinates financial advice with the most important was to have at least 1 year emergency fund in the bank, enough to cover all you expenses.


Having owned 2 different RV's over the last 23 years the other advice I have is that do no plan on the RV being worth anything whey you try to sell it. Depreciation on an RV is significant. The MSRP on my coach when new was $240K, I bought it used when it was 6 years old for ~28% of MSRP (it was a repo, someone else's misfortune), and now 17 years later it may be worth ~17% of MSRP.



Considering you have never RV'd I would advise to rent one for a vacation to give you a sense of what it would be like.

If you decide the vacation was something you could see in your future I would recommend looking at a good used RV.


There is no way I would liquidate all my assets and buy an RV, in the end you will have an asset that will depreciate quickly.

[RVPioneer]

Originally Posted by Jlo11111

Option 11: pay off your debt, cut your spending by 25%, put away enough cash to live off of for at least 6 months, then revisit whether you really want an RV.

This is not an unreasonable recommendation. If everyone followed it, the number of RV’s on the road, and in storage facilities, would be reduced by at least 90%.

In the OP’s case, he is a workaholic with great income, who is looking for something to distract him from work while at the same time allowing the opportunity to travel and spend time with his wife who is in poor health.

Renting first is a good idea. So is working with a fiduciary. If there is sufficient disposable income after reasonable savings and retirement goals are met to cover the expense of a motorhome, why not? Now may be the time for them to do this rather than a few years down the road when a couple more boxes have been checked off on the list of retirement goals.

[tim07]

I agree on the rent first option. I would only say after you secure your loan, after some time refinance. I was able to get a much lower rate by shopping credit unions around the country, even if you're not a member of that credit union.