Looking at purchasing an RV

[Okichewy1]

Little about myself. Married with 2 young adult children in college and 2 large dogs (75 and 90lbs). Live in southern Idaho but have family in Michigan, Georgia, Alabama and Florida. I am 46 y/o and wife is 43. I retired from the Marines and currently work for the US Forest Service. Have about 14 years till I plan on retiring at age 60. We are looking to purchase an RV in 2021 when we have our car, truck, boat and home heating system paid off. I already have budgeted about 1200.00 max a month for the RV loan payment, 100.00/month for storage and then have a couple quotes for insurance so have that money budgeted in. We initially will be using this for random vacations due to working still, but would like to have something paid off prior to my retirement. We have looked at Class A and Class C's and think were hooked on the Class A's. Any pointers for a new couple looking into these would help. Sorry this is so long.

Thanks,
Ken

[Okichewy1]

livemusic wrote:

Okichewy1 wrote:
Yeah, when I bought my brand new 2012 Jayco TT, we paid 13,500 out the door at a dealer, 2 years later sold it for 12,000 to a couple. Thought it was a good investment for the 2 years.

I have never heard of anyone buying anything new, using it for 2 yrs, then selling it for 89% of what you paid for it. I can't believe you asked that price and can't believe they paid it! No offense, I've just never heard of anything like that. Obviously, it can happen. I bought a 2008 Nissan Titan truck for an absolute steal due to the horrific recession and they couldn't get rid of trucks, but I didn't sell it, still have it. Cheers!

Yeah, when we bought it, we drove 6 hours to Montana to purchase it. It was the last one of that model and was mid August. The dealer took off another $1,000 since we drove to get it. When I sold it, I figured I would ask high and see what I get brought down too. They only asked me to reduce my price by $500.00.

[livemusic]

Okichewy1 wrote:
Yeah, when I bought my brand new 2012 Jayco TT, we paid 13,500 out the door at a dealer, 2 years later sold it for 12,000 to a couple. Thought it was a good investment for the 2 years.

I have never heard of anyone buying anything new, using it for 2 yrs, then selling it for 89% of what you paid for it. I can't believe you asked that price and can't believe they paid it! No offense, I've just never heard of anything like that. Obviously, it can happen. I bought a 2008 Nissan Titan truck for an absolute steal due to the horrific recession and they couldn't get rid of trucks, but I didn't sell it, still have it. Cheers!

[Grit_dog]

All kinds of life coaching going on here....
Regarding buying a RV 2-3 years from now and storing/maintaining it for basically another 10 years before it's fully "in use", I would analyze that scenario more closely than floor plans and financing arrangements.
- Storage. Unless indoors, in 10 years the sun is going to take it's toll on that "brand new" RV.
- The depreciating assets comments are true. Do you want to eat the depreciation and most of the interest payments while not really using it and start off with a 10 year old rig that you just spent roughly $190k on for a $120k purchase (I used 20 year loan, 5.5%, $120k loan amount, paid off in 12 years)?
To that point, don't buy anything in 2021, invest/save your $1000-1200/mo for 10 years. Have the better part of $200k in cash to buy a 10 year old low mile (stored like you plan on doing) for like $50k. Spend another however much on a trailer or little rv for your infrequent vacations over the next 14 years.
Then when you retire you can have the same RV you're plannin on buying in 2021, pay cash and have an extra $100k in cash leftover.

If intent on a new RV, I'd wait until it's time to use it full time, go big spender on it and if you don't get it paid off, you'll still have $100k of play money and can let the kids, bank and executor deal with it when you croak.

[2gypsies1]

theoldwizard1 wrote:
One thing about any motorhome, once you are "setup" at a campsite, you can not quickly/easily decide to run into town for a gallon of milk or go to dinner.

I would rather have a trailer !

Unless you have a very short motorhome the majority of motorhome owners tow a car. That's what you use to run to the store and to do siteseeing… lot better fuel mileage for doing those things than a RV.

[Okichewy1]

Jayco-noslide wrote:
Have you considered going used to bring the price way down and attempting to pay cash. Any new RV really depreciates and isn't any better than one of good quality and well cared for 3 to 5 years old. We bought a 30 ft. Class C which was 10 years old at the time and it had depreciated from around $75000 to $23000(what we paid) in that 10 years and we still have it. We are debt free and will only buy a car or RV cash. Probably going way too far in advice giving but I wish you the best and you will enjoy whatever you get.

Yes, we have talked about used also. I have just been looking at new cause it's easier to get the floor plans to look at online. Once I find some floor plans we like am going to do some searching for used ones of those models. I just used the 20 year loan as an example since we can afford up to a 20 year loan and about 144,000.00. Don't necessarily want to go that high, my thought was even if we purchase new at about 80k, with 1200.00 monthly for max payment we could pay off within 10 years or so. Goal was to not have an RV payment by the time I hit age 60 for retirement which would be about 12 years. We are in the researching phase now, don't plan to purchase anything for 3 more years. Have so much information so far, planning on writing up a spread sheet so I can take it all in. Biggest goal is to not have an RV payment when I go into retirement.

[DrewE]

theoldwizard1 wrote:
One thing about any motorhome, once you are "setup" at a campsite, you can not quickly/easily decide to run into town for a gallon of milk or go to dinner.

I would rather have a trailer !

To some extent, that does depend on how much you set up at the campsite. Often for me it's just a matter of disconnecting the power cord (if it's an electric site), putting the entrance step in, and driving off the ramps. Well, that and clearing any clutter off the countertops. It's a matter of a few minutes generally.

Granted, even if leaving isn't too hard, a motorhome is far from the most convenient vehicle to run around town. A good part of the solution is to do one's grocery shopping en route between campgrounds (and eating out and so forth), which is not much of a burden if you tend to move around fairly frequently but a lot less practical if you prefer to spend a week or two at a given location.

[kknowlton]

One thing about any motorhome, once you are "setup" at a campsite, you can not quickly/easily decide to run into town for a gallon of milk or go to dinner.

I would rather have a trailer !

That's why we went to trailers after having a (small) MH. The OP is looking at a bigger MH which could, potentially, pull a car, and I'd recommend that, Okichewy, if you end up following your plan.

I second all the caveats others have mentioned about depreciation and taking out longterm loans on RVs. Definitely beware.

[theoldwizard1]

One thing about any motorhome, once you are "setup" at a campsite, you can not quickly/easily decide to run into town for a gallon of milk or go to dinner.

I would rather have a trailer !

[Jayco-noslide]

Have you considered going used to bring the price way down and attempting to pay cash. Any new RV really depreciates and isn't any better than one of good quality and well cared for 3 to 5 years old. We bought a 30 ft. Class C which was 10 years old at the time and it had depreciated from around $75000 to $23000(what we paid) in that 10 years and we still have it. We are debt free and will only buy a car or RV cash. Probably going way too far in advice giving but I wish you the best and you will enjoy whatever you get.

[A_Good_Cigar]

Okichewy1 wrote:
Little about myself. Married with 2 young adult children in college and 2 large dogs (75 and 90lbs). Live in southern Idaho but have family in Michigan, Georgia, Alabama and Florida. I am 46 y/o and wife is 43. I retired from the Marines and currently work for the US Forest Service. Have about 14 years till I plan on retiring at age 60. We are looking to purchase an RV in 2021 when we have our car, truck, boat and home heating system paid off. I already have budgeted about 1200.00 max a month for the RV loan payment, 100.00/month for storage and then have a couple quotes for insurance so have that money budgeted in. We initially will be using this for random vacations due to working still, but would like to have something paid off prior to my retirement. We have looked at Class A and Class C's and think were hooked on the Class A's. Any pointers for a new couple looking into these would help. Sorry this is so long.

Thanks,
Ken

Ken, I am also 46 & working on eliminating debt so I can retire at 60. Since your previous RV experience is with a TT, personally I'd suggest a way lower budget for your first motorhome! Nobody gets it right the first time, and you're in the catbird seat right now since you plan on being debt-free in 3 years. My only debt in 2015 was my mortgage, and I wanted to move up to a Class A from my older Class C. I researched for about a year, and set a limit of just $25000, which put me in mid-level late 90's or early 00's gassers with at least one slide. I picked up a 2000 Itasca for right at $25K, including a 3 year warranty for peace of mind, and I put 10K down. I paid that loan off in 2 years for the credit rating boost, but the important thing is I got a fairly modern RV, for a quarter of the new price that will easily last me 10 years while I continue to save money and shop for the "retirement" RV. A 2000 may be older than you'd like, but the gist is to pick up something cheaper to get your feet wet, pay it off a LOT faster, and spend a few years saving so you can buy the retirement RV in CASH! Sorry to be so long-winded, but seeing you say finance a twenty year loan made me cringe!!! Let us know what you decide!

[Okichewy1]

Optimistic Paranoid wrote:

Okichewy1 wrote:
I at least have 3 more years before we even purchase, but want to make sure we are doing the right thing. Me personally, I wanted to purchase a 2nd home on The Big Island, HI since I have found some for less than 200k. But the wife wants an RV.

Any way you could swing buying the home in Hawaii and turning it into a rental property? Done right, this would give you an APPRECIATING property to offset the depreciating motor home, and one that the rent could cover the mortgage and property tax costs. Maybe you could rent it to a military officer assigned to Hawaii, I would assume they would be a better class of renters, which is the one big problem with being a landlord.

Understand that you need an exit strategy. Your motor home will be depreciating, and sooner or later you will either get tired of being on the road, or you or your wife will get too old or ill to continue living in a motor home.

You've got time. Was I you, I would be exploring something like this with a certified financial planner to figure out all the angles.

Will get with my financial planner and see what they say. Thanks for the information.

[Optimistic_Para]

Okichewy1 wrote:
I at least have 3 more years before we even purchase, but want to make sure we are doing the right thing. Me personally, I wanted to purchase a 2nd home on The Big Island, HI since I have found some for less than 200k. But the wife wants an RV.

Any way you could swing buying the home in Hawaii and turning it into a rental property? Done right, this would give you an APPRECIATING property to offset the depreciating motor home, and one that the rent could cover the mortgage and property tax costs. Maybe you could rent it to a military officer assigned to Hawaii, I would assume they would be a better class of renters, which is the one big problem with being a landlord.

Understand that you need an exit strategy. Your motor home will be depreciating, and sooner or later you will either get tired of being on the road, or you or your wife will get too old or ill to continue living in a motor home.

You've got time. Was I you, I would be exploring something like this with a certified financial planner to figure out all the angles.

[ksg5000]

Okichewy1 wrote:
Yeah, when I bought my brand new 2012 Jayco TT, we paid 13,500 out the door at a dealer, 2 years later sold it for 12,000 to a couple. Thought it was a good investment for the 2 years.

You made out well ... but that is clearly an exception and you won't find many with similar results. Likely as not your rig will lose 20+ percent when you drive it off the lot and continue to decline at significant rate for another 5+ years. As implied in my other comment - many would argue you should never finance a rig ... and more would agree that financing a rig when your retired is even worse. Who wants to die unexpectedly and leave their spouse with rig that is underwater? I don't want to sound preachy .. but financing a rig in retirement is a lousy idea. Your RV will depreciate your Big Island house will appreciate.

[donn0128]

Be real careful when looking at "MSRP" numbers. There all a joke. MSRP is whst a dealer wants to say it is. If there willing to sell a MH for 129K then it likely has a realistic market value around 135K. RV trader is one place to search out realistic selling prices. Another is PPL motor homes out of AZ.
Instead of buying a new MH if I were in that market I would be looking for something like a Monaco, Country Coach, or the like. At least you would get a quality coach at a price that could make things very afordable.