A Yacht Purchase - a Life Style Investment

by Des Ryan on 5 Nov 2008 With all the talk of recession, liquidity crises, credit crunches, stock market big dipper rides, job layoffs, dismal financial forecasts, it's no wonder our hands are staying in our pockets. But are we missing out on LIFE?

As Ron Lieber pointed out this month in Money Column of the New York Times, the vast majority of people will not lose their jobs, and most of us work not merely for subsistence, but so we can spend money on things and experiences that fulfill some of our dreams.

There ARE some people who are taking off to sail around the world, chartering to go on that dreamed-of holiday in the South Pacific or the Mediterranean, or even buying their first yacht.

Lieber tells a story about Ron Stefanski, who has just splurged on a 38-foot sailboat and lowered the 20-year-old vessel into their home waters in Michigan. The question his message raised was whether spending money on a boat was actually wise, and if so, why?

Money was part of what kept the family from buying a boat for years, even though Ron had long wanted one. Until four years ago, Ron’s wife, Kay, had been home raising their two boys, Dan, now 15 and Will, 17.

'We don’t have trust funds for our kids or oodles of discretionary income,' Ron said. 'So I was the one who kept saying, ‘Do we really need to be spending money like this when we need to get money in the bank for college?’ '

Instead, the Stefanskis came to realize, the boat was an investment in something much more valuable than money.

'When you look at life from that perspective, it’s about creating memories,' he said. 'Because the good moments can be fleeting and they can be peppered with other experiences that you don’t want to be as memorable.'

A boat is also an investment in relationships, something that isn’t readily apparent until you’re on one a lot. Kay, who is 46 and works in textbook sales, helped talked Ron into buying the boat.

'We’re getting ready to be empty-nesters, learning how to navigate the space of being alone together, and that’s something that’s been a little bit sobering,' Ron said. 'What she helped me to see is that having the boat is an opportunity to connect, to spend time together when the boys are off doing their own thing.'

In fact, Dan and Will have been on the boat a fair bit, too.

'As a teenager, I look forward to doing things that teenagers do, going to parties and hanging out with my friends,' fifteen year old Dan says. 'But the boat is something I really learned to love.'

That has been an added bonus, given that the boys will soon be in college or away for the summers. 'This was a window of opportunity,' Ron says.

The Stefanskis financed the purchase with a home equity line of credit.

For people who find themselves frightened by the possibility of a long, deep recession, well, the Stefanskis know how you feel. Since they bought the boat, the balance in their retirement accounts has fallen by about a quarter. The investments in the college savings accounts for the two teenage boys have hit the skids, and the troubled economy means their house is worth a lot less as well.

'If you value family and friendships and experiences, the things that you might lose don’t mean quite as much,' Kay said. 'It puts it all in perspective.'

Ron added, 'Your job as a parent, a friend or life partner is to create memories with each other. That’s what we’re here for. And I think in that respect, the decision to purchase the boat was a good decision.'

Ron Lieber normally writes about 'money'. This time he has also illuminated something worthwhile about the issues of why we live and work the way we do.