Bike finance

[Coolspin]

I think the general feeling exists because of a few reasons, at least, they're the ones that stop me from financing a super bicycle:

Massive rate of depreciation

Risk of total loss is much higher than mang hobbies

Fact that it's a very personal item, ie, no one else is going to be riding your bike

Maintenence costs

Likelyhood of changes and upgrades

Hell, the cost to insure a bike is nearly a vehicle repayment.

Finance if you must, if you can really afford the finance, and if you're going to make the effort to pay it off sooner. There are much worst things you can blow money on each month anyway.

So I think you have relevant points for sure as to why there seems to be this disconnect between financing of bikes and these other items, but do they really apply?

 

Devils advocate may say:

Cars, motorcycles and boats depreciate too.

Risk of total loss cannot be higher than a car thats driven every day in SA.

Someone else will be able to ride the bike when you sell it to them.

Cars, motorcycles etc all have maintenance costs.

If you purchased the more expensive bike, you would be less likely to require expensive mods and upgrades.

 

Amounts to be spent are relative or subjective but i can certainly see the logic in a person buying say a 60k bike with a reasonable size deposit and buying an item that would satisfy their need to buy a good bike as opposed to buying an "entry level" bike for 30k and not buying what they really wanted. They would always be hankering for the upgrade.

 

With the prices of the bikes going up the way they have must drive the growth in bike financing.

 

Wonder how many people have taken money from say a bond or credit card to buy a bike but in their minds dont see this as financed, they see this as paid "cash"

 

Just saying, if you use finance to buy a bike, people shouldnt make moral judgements about it as they have all likely "financed toys"

 

There is an amount of logic in the saying, "the sweetness of quality is remembered long after the bitterness of the price has been forgotten" or something like that.

Edited December 1, 2017 by Coolspin

[Butterbean]

So I think you have relevant points for sure as to why there seems to be this disconnect between financing of bikes and these other items, but do they really apply?

 

Devils advocate may say:

Cars, motorcycles and boats depreciate too. They do! But certainly not at the same rate as bicycles. Hell, I've been on the market for a camping trailer recently, and after two years they start appreciating!

Risk of total loss cannot be higher than a car thats driven every day in SA. Disagree. Especially mtb. Risk of theft, hijacking, crashing with write off level damage, and fraud in the marketplace make it a rather big risk. The chances of someone coming off at big fun rides like Argus and 94.7 are super high, even in the extremely experienced bunches.these risks are the

same while training too!

Someone else will be able to ride the bike when you sell it to them. True, but unlike a boat, motorcycle, horse, weekend car, etc, while you own it and pay it off, it's still extremely personal and very unlikely to be a shared item. So rate of obtaining permission for such a financed toy are greatly diminished compared to the former toys.

Cars, motorcycles etc all have maintenance costs. For sure, but bicycles? In 2017? My Fortuner is cheaper to service than my entry level mtb. And that's either at dealers and bike shops, or my own labour on both. Considering a motorbike service is cheaper than a bicycle in many cases...

If you purchased the more expensive bike, you would be less likely to require expensive mods and upgrades. Lies. Pure lies. You have to admit that no matter what bike you but, you're going to make changes. Personal items like grips, bartape, saddles, stems, and handlebars will all be changed if you're serious about being comfortable. Even high end bikes have some collection of crappy components too, so anyone who's spending will upgrade.

 

Amounts to be spent are relative or subjective but i can certainly see the logic in a person buying say a 60k bike with a reasonable size deposit and buying an item that would satisfy their need to buy a good bike as opposed to buying an "entry level" bike for 30k and not buying what they really wanted. They would always be hankering for the upgrade.

 

With the prices of the bikes going up the way they have must drive the growth in bike financing.

 

Wonder how many people have taken money from say a bond or credit card to buy a bike but in their minds dont see this as financed, they see this as paid "cash"

 

Just saying, if you use finance to buy a bike, people shouldnt make moral judgements about it as they have all likely "financed toys"

 

There is an amount of logic in the saying, "the sweetness of quality is remembered long after the bitterness of the price has been forgotten" or something like that.

I get you for sure, but the answers to Satan's lawyer are above, at least from my mind.

 

Fact remains that a bicycle is a very expensive, very high risk, very personal item. Few people in the world can afford to own high end stuff, and even less can reasonably and intelligently finance them.

 

Only time it makes sense is saving vs finance right now. Argument has been had many times before, but with the rate at which bikes pricing increases, you're often better off buying now and paying some interest, than saving money for a full amount that keeps exponentially rising.

[Coolspin]

Hey DragoRosso,

 

If you edit my post in the quote, could you please bold your text or else it looks like I wrote the whole post that you quoted above, which I didnt, so the quoted post really doesnt make sense.

 

We can agree to disagree, to my mind it doesnt make sense to say,

some toys are ok to finance and others are not, depending on which toys you are most passionate about.

 

There is hipocracy on display when people say that you shouldnt be financing a bicycle yet sit with a Motorcycle, or car etc that has been financed in the garage.

[Patchelicious]

Hey DragoRosso,

 

If you edit my post in the quote, could you please bold your text or else it looks like I wrote the whole post that you quoted above, which I didnt, so the quoted post really doesnt make sense.

 

We can agree to disagree, to my mind it doesnt make sense to say,

some toys are ok to finance and others are not, depending on which toys you are most passionate about.

 

There is hipocracy on display when people say that you shouldnt be financing a bicycle yet sit with a Motorcycle, or car etc that has been financed in the garage.

If you MUST finance a car to get to work, that is different to a person financing a R120k MX bike or bicycle. So its not binary hypocrisy. But one can find hypocrisy in ANYTHING to support ones view. 

 

I think, where the subjective or "moral" (as you say) aspect comes in is the cost vs net gain differential and accepted social norms.

 

If you cannot afford a R120k 2017 Epic Sworks, just buy a R35k 2014 Epic Marathon, according to the same people who end up financing bicycles, its apparently almost exactly the same thing, and it is. But you will not find that same cost vs net gain in motorcycles, so even though its still a hobby, there is very little chance of a guy who is wanting to ride a GS with his buddy of finding something VERY similar to his buddies GS1200 for a quarter of the price, like you can in the bicycle market.

 

Its not about hobby types, or even "asset" risk (insurance mitigates this anyways), but there are differences.

 

Finance a bike, don't finance a bike.... I don't really care. But people are not wrong if they say that its usually better not financing depreciating non essential hobbies. Just be cautious. 

Edited December 4, 2017 by Patchelicious

[Letum911]

People tend to overthink this completely!!! If you can afford the finance, know that you will be paying more in the long run, and still want it get it.

 

I have financed a bike before via credit card, I very well knew that it will be costing me 20% more over a year. I made piece with it, paid it off, and still love the bike!!!

 

Looking back at it, if I were in exactly the same situation I would do it again. Would most likely just shop for a finance company with a lower interest rate, but that's life. I paid the bike off in 4 months and it cost me roughly R1000.00 more on a R15k bike and in those 4 months I spent about 30+hours on it, therefore it cost me R33.00 per hour more than it would have if I had saved up the money.

[Patchelicious]

People tend to overthink this completely!!! If you can afford the finance, know that you will be paying more in the long run, and still want it get it.

 

I have financed a bike before via credit card, I very well knew that it will be costing me 20% more over a year. I made piece with it, paid it off, and still love the bike!!!

 

Looking back at it, if I were in exactly the same situation I would do it again. Would most likely just shop for a finance company with a lower interest rate, but that's life. I paid the bike off in 4 months and it cost me roughly R1000.00 more on a R15k bike and in those 4 months I spent about 30+hours on it, therefore it cost me R33.00 per hour more than it would have if I had saved up the money.

 

 

If you can afford the finance of a R120k bike, surely you could afford to save up for a R35k almost as good one?

 

If somebody said. "Screw it, I financed a bike because I WANTED one NOW, and dont have the patience to save up for one, or my ego says I need the best one, right now and wont ride a second hand bike!" I would actually accept that as a honest and acceptable answer. 

[Mojoman]

People tend to overthink this completely!!! If you can afford the finance, know that you will be paying more in the long run, and still want it get it.

 

I have financed a bike before via credit card, I very well knew that it will be costing me 20% more over a year. I made piece with it, paid it off, and still love the bike!!!

 

Looking back at it, if I were in exactly the same situation I would do it again. Would most likely just shop for a finance company with a lower interest rate, but that's life. I paid the bike off in 4 months and it cost me roughly R1000.00 more on a R15k bike and in those 4 months I spent about 30+hours on it, therefore it cost me R33.00 per hour more than it would have if I had saved up the money.

I put a couple of grand on my CC to help pay for my last bike as it was on special and just ate beans on toast for a month (well, not that bad but you get the picture!) till it balanced out again...! 

[Letum911]

 

If you can afford the finance of a R120k bike, surely you could afford to save up for a R35k almost as good one?

 

If somebody said. "Screw it, I financed a bike because I WANTED one NOW, and dont have the patience to save up for one, or my ego says I need the best one, right now and wont ride a second hand bike!" I would actually accept that as a honest and acceptable answer. 

 

If you finance for the sake of petting your ego sure it is open to be criticized. Well for that matter you can probably criticize someone in general for spending that on a bike to pet an ego, as the majority of the people riding R120k bikes will never in their life be a podium contender.

 

I could not splash out the R15k, so financed it, worked my rear off and paid it off. Does this now make it the best financial decision? Most probably not, and that was also not the point, I did what worked for me in those circumstances.

[ChrisF]

Its December ....

 

Just have a look at what is on our roads ....

 

Luxury boats being towed 

 

200k camper trailers, or 300k caravans ....

 

behind very expensive tow vehicles that do a few thousand km a year ....

 

12k a year for pay-tv ....

 

many paying 10k+ a year on cell phones ....

 

This list of "I want" consumerism is endless !!

 

 

At least a bicycle that gets used has some health benefits, as compared to the vast majority of consumer spending .....

 

 

In a world of instant gratification a bicycle may thus be one of the healthier debts ....

 

 

 

 

 

BUT, my dad taught me: "If you cant buy it cash, you cant afford it" .... Apart from a bond, I have never had any other debt, not for a car, and certainly not for a toy or bicycle .... but I am just a grumpy old fart from a time gone past, so young ones feel free to ignore me ....

[Hairy]

If you MUST finance a car to get to work, that is different to a person financing a R120k MX bike or bicycle. So its not binary hypocrisy. But one can find hypocrisy in ANYTHING to support ones view. 

 

I think, where the subjective or "moral" (as you say) aspect comes in is the cost vs net gain differential and accepted social norms.

 

If you cannot afford a R120k 2017 Epic Sworks, just buy a R35k 2014 Epic Marathon, according to the same people who end up financing bicycles, its apparently almost exactly the same thing, and it is. But you will not find that same cost vs net gain in motorcycles, so even though its still a hobby, there is very little chance of a guy who is wanting to ride a GS with his buddy of finding something VERY similar to his buddies GS1200 for a quarter of the price, like you can in the bicycle market.

 

Its not about hobby types, or even "asset" risk (insurance mitigates this anyways), but there are differences.

 

Finance a bike, don't finance a bike.... I don't really care. But people are not wrong if they say that its usually better not financing depreciating non essential hobbies. Just be cautious. 

I am just glad my 4-something-K commuter bicycle has more mileage on it this year than my car

[GrahamS2]

BUT, my dad taught me: "If you cant buy it cash, you cant afford it" .... Apart from a bond, I have never had any other debt, not for a car, and certainly not for a toy or bicycle .... but I am just a grumpy old fart from a time gone past, so young ones feel free to ignore me ....

I was taught the same thing about living within your means, and it's paid dividends managing my finances that way.

 

Financing 'fun' items is not about if you can afford it or not. It's about the knock on effect the  new debt will have on servicing your other debts. Because let's be honest, if you're financing a bicycle you more than likely have a lack of cashflow and a few other debts...

Edited December 4, 2017 by GrahamS2

[Patchelicious]

If you finance for the sake of petting your ego sure it is open to be criticized. Well for that matter you can probably criticize someone in general for spending that on a bike to pet an ego, as the majority of the people riding R120k bikes will never in their life be a podium contender. 

 

I could not splash out the R15k, so financed it, worked my rear off and paid it off. Does this now make it the best financial decision? Most probably not, and that was also not the point, I did what worked for me in those circumstances.

Absolutely, but at least you are honest about it. Thats what I can appreciate.

 

On your first point, I agree even more, I bought a MTB way out of my league, you know why? Because I wanted it, thats it! There is no logical justification why I needed a RS1 Epic Sworks when I had a perfectly good working Epic Expert. At the time I was saying "RS1 was good for Desert Dash, two bottle cages in the frame, SWAT box bla bla bla".... but we all know that was just trying to justify a bike I wanted, not needed.

 

So my posts are not about giving financial advice, do what you want, just stop talking *** about why you are doing it

Edited December 4, 2017 by Patchelicious

[Mr lee]

It all depends on different people and their actual and present financial situations.

 

I personally would never want to finance a bike cause the total amount paid over the full period scares the crap out of me and I see it as a total waste of money. 

 

...but if I did not have the cash handy and really wanted or needed a reasonably priced bike for my needs I would probably go the finance route....BUT I would definately make sure to use it and not leave it with cobwebs and a few layers of dust in the garage 

[Letum911]

Absolutely, but at least you are honest about it. Thats what I can appreciate.

 

On your first point, I agree even more, I bought a MTB way out of my league, you know why? Because I wanted it, thats it! There is no logical justification why I needed a RS1 Epic Sworks when I had a perfectly good working Epic Expert. At the time I was saying "RS1 was good for Desert Dash, two bottle cages in the frame, SWAT box bla bla bla".... but we all know that was just trying to justify a bike I wanted, not a needed.

 

So my posts are not about giving financial advice, do what you want, just stop talking *** about why you are doing it

 

Fair point, but as per my first post that is what I wanted and I knew the associated costs.

 

As for your poor decision, out of all the nice bikes to finance a SPAZ?! I hope you feel judged

[Patchelicious]

Fair point, but as per my first post that is what I wanted and I knew the associated costs.

 

As for your poor decision, out of all the nice bikes to finance a SPAZ?! I hope you feel judged

Even worse.... I didnt finance it, I saved up for it. Have ridden it offroad twice, last time being the Desert Dash 2016, and have lost R35k in value looking at current market value.

 

So still not a good financial decision, but I wanted it, it was my money, so screw you guys, I'm going home.

Edited December 4, 2017 by Patchelicious

[Gen]

Even worse.... I didnt finance it, I saved up for it.

I want lots of bikes..your black beauty is one of them..but perhaps I should start riding the 3 I have first..

 

On a side note..finance.. don't finance..I wouldn't..but different strokes for different folks..who knows maybe they finance and can't afford the payments ..maybe they'll sell them and we can pick up a bargain or 2.[emoji6]

 

Sent from my SM-G950F using Tapatalk