Dear Donald, Thanks For The Yacht

Welcome back FatCats; today’s story is a lot of fun.

Thanks to my good friend Michael (see A Canadian In Panama), I’m in the market for a boat. And for the next few minutes, so are you.

First, we have to make some tough decisions:

Catamaran or Mono-Hull?

Powered?

Or Sailing?

We could get lost in that conversation forever… the only real long-term solution is to have one of each––but where to begin?

Personally, I’m partial to the sailing catamaran…

 

Hard to say no to that. Sailing Catamaran it is

Now that the hard part’s over, what’s the process of purchasing a yacht exactly?

I reached out to a FatCat yacht owner, who connected me with a guy named Frank; he’s been dealing in luxury yachts longer than I’ve been alive. The average boat Frank sells runs 750k, and last year he sold 34 of them.

For the record, neither I nor FatCatInvest.com has any affiliation or monetary arrangement with Mr. Frank McCarthy, Atlantic Cruising Yachts, or Fontaine Pajot…we just like their boats.

Frank’s an accomplished sailor, competition racer, the whole deal, “I came into the industry as a boater, a sailor, as an owner––that’s my background…I love boats and boating, anything to be on the water.”

“With the number of boats you’ve sold,” I ask, “I imagine you see the same situations over and over again with clients––the same problems, same misconceptions––what advice do you have for first-time yacht owners?”

“The number one thing we see everywhere we go is the misconception that you need to be a multi-millionaire to have one of our boats. Most people assume they don’t make enough money to buy a yacht, but in fact, a typical buyer these days makes around $300k/year.”

“Especially since the new tax code passed,” he continues, “People are discovering that––with new even more lucrative tax incentives––yachts are now affordable, advisable from a tax-planning perspective, and with the correct structure…can be purchased with very little––even zero––out of pocket costs.”

“Really? So what, you have a whole class of people waking up then, to an industry they thought was closed to them?”

“Exactly. These days, we don’t even talk about boats in the boat business. I’d say 85% of my time with client’s now centers around one thing: taxes.”

Frank walks me through leveraging tax efficiencies, net operating losses, reasonable expectations of profit, above the line income reductions…. Frank’s company is really part boat dealer, part tax-planning––it’s super smart, and the numbers I’m hearing are hard to believe. One thing is clear: the government really wants you to buy a yacht.

Not surprisingly, Frank has his own in-house Tax Advisor/Planner/Consultant, whose job is to educate your accountant on the latest yacht loopholes and how to use them.

Even better, he’ll also serve as the CFO of the new boat company you’ll be setting up, adding a layer of legitimacy to the business.

So how does this work, how is it structured? The big picture is actually pretty straight forward and logical.

1 2 3 4
View single page >> |

K.457 © 2018 FatCat Consulting Limited. All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from the publisher. This ...

more
How did you like this article? Let us know so we can better customize your reading experience.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.
Kurt Benson 2 years ago Member's comment

Fun read. Have more?

Susan Miller 2 years ago Member's comment

I liked your articles. Why did you stop writing?