Crossroads???

[Snoopy49]

Hello everyone. My wife and I are at a cross roads about our long term home situation. Right now we rent a real nice home for $1400 a month. She has a great job at our hospital and I have a great job nearby as a AutoCAD Draftsman. We are simply tired of paying rent, Since our credit is in the low 600's we are in a bad place for obtaining financing without potentially a significant amount of money down which right now we do not have. Our kids are all grown and gone so it is just my wife and I. Just today, we started discussing buying a new or gently used 5th wheel to live in full time. Our discussions right now are confined to the pros and cons of making such a drastic lifestyle change. We are just tired of tossing money to rent with no investment return. However, I still have 12 more months until my lease is up so there won't be any fast decisions made.

What do you all think of a 60's ish aged couple like my wife and I dumping most of our possessions, buying a trailer/truck and finding a local place to setup camp in a 5th wheel full time. In watching the TV series "Going RV'ing" we see more and more people are doing this. 

Can anyone point our some potential issues/pitfalls with doing this?

Thanks
ZM

 

[Back2PA]

we started discussing buying a new or gently used 5th wheel to live in full time. Our discussions right now are confined to the pros and cons of making such a drastic lifestyle change. We are just tired of tossing money to rent with no investment return.

The first thing you should know up front is that an RV is not an investment. If you buy new, and are a fantastic negotiator, the day you tow it off the lot you can count on a 20+% loss, and another 20% in the next year or two. If you buy used, and again do a fabulous job negotiating, you might come close to breakeven or perhaps only a 10-15% loss after a couple years.

If the cash flow works for you, and you decide on a drastic lifestyle change strictly for the fun of it, it could be great. But don't think about RVs from an investment perspective, because they are lousy investments.

 

[Isaac-1]

The big question is do you intend to travel, if not then I would not suggest it, RV life is not as cheap as most people think, even when sitting still, and has already been mentioned they depreciate quickly, many people that buy new and finance quickly find themselves upside down on the loan, and stay that way until it is paid off.  Also do you want to drive a $40,000+ (assuming late model used) 1 ton  dually  pickup truck around as a daily driver?

 

[Larry N.]

In addition to the above comments, keep in mind that owning the RV doesn't give you a place to stay like a home does -- you still have to rent or buy land to park it on, along with sewer, water and electric considerations. And cities/counties generally won't allow an RV on a normal residential lot. So you have the major depreciation of the RV plus the rental of the parking space, plus whatever utilities are not included in the rental. In 10 years your $100,000 purchase has become $40,000 or $50,000 IF you maintain it in top shape, less if you don't. Or if you go real cheap, the $20,000 you spend on the RV, plus the $5,000 to $15,000 you spend fixing it up will become $10,000 to $20,000 in 10 years. And you can't call the landlord to fix problems -- that's all at your expense, whether time, dollars or both.

Note that the above is in contrast to a regular house where, depending on the area, that $100,000 might become $120,000 to $180,000 in 10 years, with no rent involved. Sure, it requires a down payment, but so does an RV, if you're financing.

So do your research VERY carefully before committing to an RV, and don't become one of the folks who have wound up in worse shape because RVing looked cheap on the surface. I'd only suggest living in an RV if you're going to travel a lot.

Personally, my suggestion would be to save a down payment, perhaps partially by cutting back on a few things (don't go drastic here), even if it only gets up to 10% down, that can get you into something in most places.

 

[Gods Country]

I guess I'll be the jerk and state that a couple in their 60's with "great jobs", marginal credit, and own nothing but bills, with no cash for a substantial down payment,  probably shouldn't be jumping into RV'ing, much less full timing.

JMO

 

[SeilerBird]

I guess I'll be the jerk and state that a couple in their 60's with "great jobs", marginal credit, and own nothing but bills, with no cash for a substantial down payment,  probably shouldn't be jumping into RV'ing, much less full timing.

JMO

You are not being a jerk you are telling it like it is.

 

[darsben]

We need to know what part of the country.
Any northern state is pretty much out for year around living in a RV.

 

[JudyJB]

Also, know that owning an RV is just another way of throwing money away.  I bought a new motorhome 7 years ago, and have averaged about $3,000 to $4,000 per year in maintenance.  In 2018, I spent a whopping $10,000 because of slide problems, hitting a huge tire tread as it rolled down the highway, experiencing two tire blowouts with one resulting in $900 worth of damage, new brakes for $2,000, new shocks, and a lot of the usual stuff.  A 5th wheel might be cheaper, but they also have big maintenance costs.

Even leaving it sitting in one place, know that things like refrigerators are much more expensive in an RV than in your home, and a lot smaller, also.  Plus, if you live in a cold climate, you will freeze in the winter.  In a warm climate, you will roast in the summer.  Most of us who live in RVs move back and forth to stay in moderate weather year-round, but know that these things are very poorly insulated, hence the freeing and roasting! 

I would strongly agree that you need to cut back on expenses and get your bills paid off and put at least $15,000 in the bank for eventual repairs.  One solution to not enough income is to work a second job for a few years and put ALL of that money into savings.  I did that to add to my 401K for 15 years before I retired and bought my motorhome.  I love this life and enjoy traveling, but I scrimped and saved for many years to achieve this.  Plus, I continue to work half-time teaching online at age 76 so I don't have to spend all that 401K on this life. 

 

[Gary RV_Wizard]

Well, you can certainly live in an RV - thousands of people do.  You need to consider, though, that it is only 300-400 sq ft.  How big is that house? Chances are your living room is 300+ sq ft now.  Are you willing to live with minimal personal space? Does one of you like to read or listen to music while the other watches tv?  It's a major change in  lifestyle.

On the financial side, be aware that a  good sized used trailer will be $20,000-$30,000 and the used truck that might pull it at least as much, so that lack of credit and down payment is still going to be an issue.  I don't think $1400/month is going to cover it, plus you still have to pay lot rent and utilities.  Living in an RV isn't all that cheap.  Have you checked into RV site costs in your area?

RVs also aren't all that grand for year-around living in a region that has real winter. They are expensive to both heat and cool.

If you plan to stay on your jobs, why do you need the truck to move the trailer around? Have it delivered to the RV park and leave it there.

 

[grashley]

I know I will be repeating others, but my thoughts:

If you live where it snows, forget about it.  You will either freeze in the winter or go broke trying to keep it warm.

We have a nice used FW, and DW and I could handle living in this space for weeks at a time, but full time would be too much!

You better have enough savings for a GOOD down payment on the FW AND enough more for emergency repairs.

Go used and save LOTS of money.  This is a purchase, not an investment.

Do a full analysis of expenses in an RV.  Monthly campground rent can easily be $800 or more for a decent campground.  COA or state  park campgrounds are less, but limit you to a two week stay.  Some charge metered electric on longer term sites.  Repairs WILL be needed.  Insurance on the RV and contents.  Higher expenses of a 1 ton truck for the FW vs driving a car.  FW payments.

You are stuck in a 400 sq ft space, compared to the ???? sq ft house you have now.  Storage space is very limited.  There is no space for your furniture or keepsakes.  No space for "stuff".  You keep ⅓ of the stuff in the kitchen, ? of your sheets, towels, blankets, ? of your clothes, very limited tool space, very limited hobby or craft supply storage, no bookshelves full of books. 

Are you ready for this??  Only you can decide.

 

[Arch Hoagland]

Well Snoopy49 I just read all the replies.

Do you have a plan B?

 

[Ernie n Tara]

You might consider a park model, but recognize that TANSTAAFL; and there are still payment and lot rental and utilities mnk etc.

Ernie

 

[garyb1st]

Aside from the info already given, you need to take a serious look at your finances.  While it sounds like you don't have much money in the bank, you mention that you both have great jobs.  Assuming that the salary of those great jobs is significant, you should consider looking at your budget and determining how you can put more money into your savings and prepare for retirement.  If you can hold out until you're both 67, you'll maximize your social security income and depending on your current age, may give you enough time to pay down any debt you may have and boost your credit score.  Having a low score costs you money every time you purchase anything on credit.  It may not seem like much but it can make a significant difference over time.

Owning and maintaining an RV is expensive.  You haven't said anything about your knowledge of or ability to repair things yourself.  That will be a major consideration if you do not have a lot of money in the bank.  I don't have the mechanical gene consequently have to pay someone who does whenever something fails.  My budget for RV repairs is $5,000 a year.  I've probably come close to that several times. 

RVing is a wonderful way to spend a retirement.  But it's not for everyone.  It's best to have a sense of the water temperature before jumping in.