nickthehunter wrote:

To answer the question, I can write off 100% of the interest on a second home. However, that doesn't put me over the top for exceeding the standard deduction. So financing to write off the interest gains does absolutely nothing for me. That overall is probably a bad strategy. At most, if you paid $1,000 in interest in a year, it would net save you $370 in taxes (37% or less depending on Taxable Income).

But keeping my money invested and using other peoples money while only paying them 4.49% in interest is a winner. The money I kept invested is right now worth almost 70% more over the last 8 years, and that is even after it went down over 36% last year.

Now to head off the naysayers, the money is invested in a Roth IRA, total market index fund (VTSMX). I've had the fund for about 20 years, nothing fancy, moderate to above average risk. If I was going to pay cash for the RV, this is the fund the money would have come out of.

JimK-NY wrote:



You are certainly correct. It is possible to lose money when investing leveraged money. At the current borrowing rates and current investment returns that is highly likely.

Sadly very few people have any financial knowledge. I find it appalling that our schools do not teach anything regarding household finances. It is no surprise since the teachers are not educated in that regard. When I took out car loans and a mortgage, the rates were low and historical analysis predicted my 60:40 conservative portfolio would double my money with less than a 2% risk of falling short. Note that is falling short, not losing anything but a very small fraction of what I borrowed. That type of information is readily available with free online calculators.

Years ago I even bought a $40K truck totally with credit cards. It took a couple of cards and calls to up my borrowing limits. We paid our daughter's $30K tuition with credit cards. We paid off the cards immediately and had points for trips to Hawaii and to visit relatives on the other side of the country. As someone else pointed out, even taking a high cost RV loan can make sense it you get substantial incentives and there is no pre-payment penalty.

This is probably the wrong place to discuss financial matters including financing an RV, but if you blindly avoid all debt and pay off debts as soon as possible, it might be a good idea to gain some financial knowledge.

Grit dog wrote:

^Which hopefully starts narrowing the competition and lowering the prices here real soon!

Hopefully in time to score a good deal on another camper for this summer…
Gonna be tough going on prices though until the unemployment rate rises.

Bedlam wrote:

I have never financed discretionary purchases. It takes me a while to save up, but I do not have the overhead of loans slowing my saving. Paying off our home was the real factor in being able to pre save for purchases rather than financing them into the future at a higher cost.

nickthehunter wrote:

To answer the question, I can write off 100% of the interest on a second home. However, that doesn't put me over the top for exceeding the standard deduction. So financing to write off the interest gains does absolutely nothing for me. That overall is probably a bad strategy. At most, if you paid $1,000 in interest in a year, it would net save you $370 in taxes (37% or less depending on Taxable Income).

But keeping my money invested and using other peoples money while only paying them 4.49% in interest is a winner. The money I kept invested is right now worth almost 70% more over the last 8 years, and that is even after it went down over 36% last year.

Now to head off the naysayers, the money is invested in a Roth IRA, total market index fund (VTSMX). I've had the fund for about 20 years, nothing fancy, moderate to above average risk. If I was going to pay cash for the RV, this is the fund the money would have come out of.

wapiticountry wrote:

The “buying of toys” was an anomaly during the Covid restrictions. Many were bought with cash by people who will never miss the money. Vacation options were virtually eliminated. No cruises, no trips to Europe, no Broadway shows while eating in 5 Star restaurants and staying at the Ritz. Spending $25,000 or more for an RV didn’t stress them out, it was what they would have spent anyway. Only difference is they had something more tangible than photos and memories when their vacation ended. Some will have enjoyed the experience and add RVing to their vacation options, others will park it and never give it another thought and some will sell. None of the buyers from this demographic are going to be forced to liquidate due to financial hardship.

CWilson wrote:

They would remove the masks when going into the rig.