Friday, August 8, 2014

Another Reason Men are No Damned Good....

When a man dies and leaves his widow with a financial nightmare to clean up, it ain't pretty.

Men are a bunch of selfish bastards, let's face it.  Dad goes out and buys a new deerstand for himself, even though the house needs a new hot water heater.   Men buy Jet Skis, Penis Boats, Motorhomes, and other worthless purchases, while the needs of the family go unfulfilled.

The most the wife can expect is a new vacuum cleaner.  How thoughtful.

I had a neighbor once, a real redneck, and every day he would come home from work, back his truck into the yard at full speed (nearly running over his kid) and hook up his bass boat and be out of there until 9 at night.   His son would beg and plead to go, but Dad would have none of it.   The wife had to stay at home in the evenings (she worked too) to watch the kids.

He was considerate, though.  He told me once that "I bought my wife one of those self-propelled lawnmowers, so for she can mow the lawn."  Again, how thoughtful of him.   And she did, mow the lawn that is.  Frankly, I don't know much use her husband was, as his entire paycheck, such as it was, was spent on toys for him.  She had to keep the house and raise the family.   Kind of one-sided.

But getting back on topic again.  Today we are talking about over-mortgaged motorhomes.  I wrote before about a friend who had a $300,000 motorhome, and when he died, he owned $160,000 on it.   Problem was, the book retail value was only $120,000 and the last time I checked, the widow was asking $95,000 for it and getting a second mortgage on her house to come up with the difference.

I wrote before about other friends, Frank and Shirley, who bought an high-end coach and let it get repossessed, when they could no longer afford the payments and realized they were "upside down" on it.

I wrote before about a neighbors "upside-down boat" which sat in their yard for years, unused, while they paid off the note.

And recently, while reading the Wanderlodge owners site, another story emerges of a destitute widow stuck with an over-morgtaged high-end coach that she cannot sell.  Her husband died, and for the last few years before he died, the coach sat unused.  Now, two years after his death, she is trying to sell the coach, but owes more on it that it is worth.  Having sat for five years, it no longer runs, even after all the batteries (and there are many of them) are replaced.

She is screwed, big time, like the folks in the other incidents mentioned above.  And it struck me that this is a very common occurrence with expensive motorhomes, boats, and the like - depreciating assets that depreciate faster than the loan balance and are impossible to sell, as the owner owes more than the thing is worth and doesn't have the cash to make up the difference.

And it struck me that this was unfair to the widows of the world.  Men are usually the instigators of these sorts of purchases (boats, RVs, etc..) and they get to enjoy using these "toys" while only making the monthly payments on the loans.  Since men are generally older than their spouses and generally die younger, they pass away, having only enjoyed the fun part of owning an RV or big boat, and then leave their widow to pick up the pieces.

And it struck me that men can be real selfish bastards in this regard - convincing their wives, who may not be very financially astute, that they can "afford" an RV or boat that cost as much as their house, but unlike a house, depreciates rapidly, instead of holding its value over time.   The wife might make noises about the costs, but the husband says, "Gee, dear, it's only $1200 a month!  We can swing this!"

But neither party realizes that since these things depreciate like mad, the loan balance will be more than the resale value for a decade or more - perhaps a lot more.

We are parked in a campground in Canada, and there is a beautiful new Jayco Senaca motorhome parked next to our tiny camper.  Freightliner chassis and all that.   According to online sources, it retails for $230,000 which surprisingly enough is fairly "cheap" for a motorhome.  However, the sales tax alone on such a purchase would exceed the cost of our tiny Casita travel trailer (which, after a decade of ownership, is worth about what we paid for it).

Shockingly, a unit a year older is listed for nearly $80,000 less.  And three years older?  Almost half the retail value of a new one.  Scary.   Unless you pay cash for one of these things, or put down a 50% down payment, you'll be upside-down forever.

So why do people buy these sort of things?  Status is one reason - the foolish need to have the most bad-ass camper in the campground (no really, people think this way).

The second reason is the evil of the monthly payment mentality.   You can own a quarter-million dollar boat or RV for only $1744.42 a month, over 20 years at 7% with 10% down.  But of course, you'll be upside-down for at least a decade, if not more.

People with "good paying jobs" or worse - people with "good paying pensions and social security" think in terms of monthly payment and not overall costs.  The husband thinks this way, to be sure.  The wife (who raises concerns about overall costs at the get-go and is pooh-poohed by the husband) has to confront the "overall cost" aspect of the transaction after husband kicks the bucket.

So how to you clean up such a mess, if hubby died and left you a boat/RV or other financial mess to clean up?  Short answer is, you can't.    You can let the boat or RV get repossessed, but they will then sell the item and dunn you for the difference.  You can cash in your savings (if you have any) to sell the item, or take out a mortgage, as one friend did.   Or you can declare bankruptcy.

See what a nice thing your husband did to you?  How thoughtful of him.

He got to enjoy that boat or RV for the last few years of his life - and now leaves you to pay for it.

How do you avoid getting into such a mess in the first place?   Print out an amortization chart of the loan, illustrating the balance due at the end of each year.  There are loan amortization sites galore on the internet.  Then look up the book values for the boat or RV that hubby "has to have" for several years down the road - and show him how you'll be upside-down forever.

If that doesn't work, try a divorce.  That way you won't get stuck with his debts.  Seriously.  A husband who wants a material possession so much that he is willing to screw his wife (and not in the good way) is no husband at all.

Failing that, buy a cheaper, more affordable RV, boat, etc. - secondhand.  They depreciate like mad, so one only five years old often is half the cost of a new one.  Have more money to spend and less to worry about.  And put down more of a down payment, or better yet, pay cash.

No, you won't be the biggest and baddest camper in the campground.  But since when does having status in a trailer park mean anything?  No matter how fancy an RV you have, the rest of the world is looking down on you as "trailer trash" anyway, so just get over it.

Men are selfish bastards, let's face it.  And conning the wife into letting them buy expensive over-mortgaged toys and the leaving their widow a financial nightmare to deal with, is about as selfish as it gets.