15 Tips for Financing a Jet Ski Purchase

Owning a Jet Ski can be a great way to add lots of fun to a day at the beach or the lake. But with a price range that can reach over $15,000, how do you go about buying one? It’s easy to assume that most people don’t have a few thousand dollars cash laying around, but that doesn’t mean you can’t afford one.

If you have ever made a major purchase like a car, a home, or school tuition, buying a Jet Ski is not so different from that. If you have that experience then you should be able to do this without much trouble.

Choose an Appropriate Model

As mentioned above, Jet Skis can be expensive. Looking on Kawasaki’s website, the MSRP of the 2019 model Jet Ski Ultra 310LX is about $18,000. To some, this amount is attainable without much of a problem. Others might think it would be crazy to spend that much on a Jet Ski. Luckily, there are cheaper options.

The first step in buying a Jet Ski is knowing which model to buy. Obviously, 18 grand is on the more expensive side. Slightly older used models can be found for anywhere from $1000 to $5000. A more affordable new model available is the Yamaha EX, has an MSRP around $6,700-$6,900.

Make a Budget

The easiest and most efficient way to assess your current financial situation is by making a budget. If you already have a budget then you are past this important step. If not, you may want to look into making one.

Basically, a budget is an estimate of income and expenditure for a set period of time. Individuals typically make a budget on a monthly basis. Start with how much money you get in a month from work or other sources like rent or interest paid to you. That is your monthly income. Then, start breaking down the costs.

As a rule of thumb, costs should never exceed your income. If you notice that they do, you have other work to do before buying a Jet Ski. This is not a lesson on financial literacy, but you should make sure you are in a financially secure place before you consider making a major purchase like this one.

Cut Down on Costs

If after making your budget you find that your finances seem to be in order(again, meaning more money is coming in that going out each month), then you can start looking at more ways to afford a Jet Ski.

Study your budget and decide which of the cost categories would be the easiest to decrease. Right of the bat, things like eating out at restaurants and going to the movies, come to mind. These are fun activities and there is nothing wrong with doing them, but if you tend to do them more than a few times a month they can be a large expense.

Another easy way to cut costs is by monitoring your utility usage more closely. Instead of showering for 10 minutes every day, reduce that time to 7 minutes. Make sure you only have the lights on when you are in that room.

You may also look into weatherproofing your house. Improved insulation can save big on heating or cooling costs, depending on the time of year.

With gas prices almost always changing, it can be hard to know how much you will be spending on it. Consider traveling less or using other methods like carpooling, using public transportation, or riding a bike. You can also think about putting the money you save here towards the gas that you will need to use the Jet Ski.

If you are an impulse buyer, this may be the most difficult part out of everything for you to do. When walking by a store, it can be tempting to buy a new pair of shoes because they are on sale, even if you did not set out with that intention. Just remind yourself of what you are saving up for and all the fun you will be having on the water.

After making these adjustments it might be a good idea to add the Jet Ski payments to your budget. Even though you do not have those payments yet, you can begin to get an idea of how they will fit in with your other finances. You can estimate these payments after you have an idea of your financing options, which I will go into below.

Take on Extra Work

If the option is available, doing more work is a good way to save up more money. If overtime is not available at your work or you are a salaried employee, there are always other ways to earn a few extra bucks.

Offer services to your neighbors and acquaintances. Yard work and landscaping are obvious answers. If you know someone is about to paint their house you can offer to help. Make yourself available, but make sure they know your services come with a price tag.

If you notice that you have lots of extra things lying around the house or in the garage, consider having a yard sale, the proceeds of which will go directly to your Jet Ski fund.

Put your Jet Ski Money in a Specific Place

Now that you have all this extra money coming in, what should you do with it? You could put it in your mattress or in a jar labeled “Jet Ski money,” but those are not the best options if you plan on saving up for a bit. Going back to the budget, you can make a new cost category called “Jet Ski” or something along those lines.

Put all the extra money you are getting into that category as a visual symbol of the fund. As for where to put the actual money, it wouldn’t hurt to open a new bank account dedicated specifically to this cause. If the money doesn’t have a place to go, it will disappear anyway in the other expenses of your life.

Check Your Credit Score

When financing anything, your credit score is of vital importance. It affects everything from what credit cards you can apply for to who will lend you money and the interest rate on those loans you take out. When it comes to credit scores, higher is always better.

If you don’t know what your credit score is, you can check it online through government-backed sites. You are legally entitled to one free check from each of these sites each year.

To run a credit report, go to https://www.annualcreditreport.com/index.action

From there, you can choose to run your report with any combination of the three companies Transunion, Equifax, and Experian. That means, if you want, you can have all three companies run a check, or just have one do it. It is a good idea to do one at a time so that you can check up on your score for free a few times a year.

Talk to Your Bank About a Loan

After checking your score and deciding that it is high enough to receive a good loan, you can start looking into where to get a loan. A good place to start would be at your own bank.

Many banks and credit unions offer what is called a powersport loan or a personal watercraft loan.

Going through your own bank for loans is often a good idea because they are already familiar with you. They know you and how dependable you are, and since you are a customer they will gladly help you get the best deal that they offer. It is also convenient to have your loan and money in the same place.

Once example is at Mountain America Credit Union. They offer personal watercraft loans for as low as 5.49% fixed APR for up to six years. This does not guarantee that you will be offered this rate, but it does give you an idea of a starting place for banks and credit unions.

Also make sure that your own bank is not the only one you talk to. You may be able to find a better deal with a different bank.

Talk to the Dealership about In-House Financing

If you are purchasing from a local dealership, they often offer in-house financing. This can be a big plus, because they sometimes have the best deals. To learn more about it, you can either visit the store you intend to purchase from or the store’s website.

As an example, I checked a store in East Idaho called Rexburg Motorsports. Online, it says that the average in-house financing rate is 6% APR for 60 months. On the website there is even payment estimation calculator.

Once you know how much the unit you will be purchasing costs and about how much the interest rate will be, you should use a payment calculator so that you have an idea how much you will need to pay a month. That goes back to adding it to the budget as mentioned above.

Something to consider with in-house financing is seasonal offers. The model you want might not be available at the best rate when you are ready to buy because the dealership is running sales on other things. Make sure you stay on top of seasonal offers and sales that you might be interested it.

Credit Card Financing

Another financing option is with a credit card. This is generally advised against because of the higher rates associated with credit cards. They often offer 0% APR for the first 12 or 18 months, but after that the rate can jump up to 16% to 24%.

Another drawback to using a credit card is that it ties up a large amount of credit available on that card.

On the other hand, if you already have a card ready to use there will be no need to fill out an application for another loan.

Overall, the other options are going to be better than using a credit card.

Make the Biggest Down Payment Possible

The benefits of making a large down payment on a Jet Ski are the same as making a large down payment on a car or a house.

The more you pay up front, the smaller your loan will have to be. This is ideal because a smaller loan means you can pay it off faster, and that means that you will have to pay less overall interest.

Make Extra Payments to the Loan Principle

If throughout the period of your loan you find that you have extra cash on hand, putting that cash toward the loan principle is a great way to save money.

The idea is the same as making a large down payment. The quicker the principle is diminished, the less interest you will end up paying.

Avoid Late Payments

It is important that you are on time with your payments each month.

Just like with other loans, making late payments on your Jet Ski can add fees and penalties to the already substantial amount that you are paying.

Used vs New

Like with most things, buying a used Jet Ski will be cheaper than buying a brand new one. Not only is the price tag different, but it is possible that different loan rates are offered depending on if the Jet Ski is new or used.

Something to consider when making this decision is a warranty, which will more than likely be different depending on the machine’s status.

Consider a Timeshare Approach

The word timeshare might have negative connotations with you. You might think of long boring presentations that try to get you to buy something you know you really should not. That is not the idea here. If you prefer not to finance at all, you can make the purchase with a group of relatives or friends.

This approach has its pros and cons. If you and some friends or relatives have enough money combined to make the purchase right away, there will be no need to get approved for a loan or take time saving up funds. This can potentially save big by eliminating interest from the equation.

However, like a timeshare you will not be the exclusive owner of the Jet Ski. You and your group will have to come up with a system to fairly share the watercraft. This can mean always taking the Jet Ski out together, or rotating who uses it each weekend.

It also raises the question of maintenance costs. Jet Skis need periodic work done just like a car, and there are costs associated with that. If it breaks down you will have to decide if everyone should pitch in or if only the person who was using it at the time should pay. These are just a few things to consider.

Stay Focused on the Goal

In my opinion, jet skiing is one of the most fun water activities. Gliding over the water at 40 or 50 mph is exhilarating. They can also be used for other activities like fishing or tubing.

If you find yourself getting discouraged and thinking that you will never be able to afford one, just picture yourself reeling in a big fish or jetting out to a secluded island to have a picnic. It may not be easy, but the enjoyment you get will be well worth it.

Geoff Southworth

I am a California native and I enjoy all the outdoors has to offer. My latest adventures have been taking the family camping, hiking and surfing.

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