Death grip of Debt- How to guard yourself on the showroom floor

Posted by Wild Ride Radio Crew July 5, 2017 Comments are off

Death grip of Debt-
How to guard yourself on the showroom floor

By Dallas Hageman, Wild Ride Radio Host

(Special note: after this was published, I had several sales managers at various motorcycle dealerships completely bitch me out for having the audacity to try and steer you away from a lifetime of empty pockets and tons of bills…. so I took one for the team, you’re welcome.)

What a great time to be alive. I mean, it’s not like you or I had any say in the matter but that’s beside the point. Just think about it. Up until about 300 years ago mankind’s only great invention was the wheel, and even that had enormous obstacles of working 100 percent of the time. We live in a day and age where medical science is on the cusp of having the ability to transplant brains to different people (and you probably know someone who desperately needs one). Nowadays citizens have the ability to travel all over the world in a matter of hours, a hundred years ago it would have taken four months and several bouts of dysentery to go from Texas to California. We carry small computers in our pockets that possess more technology than NASA when they sent a guy to the moon and can do everything but make actual, quality phone calls. Motorcycles too have gone from a glorified bicycle with a ½ horsepower engine to machines routinely able to do 150 + mph without any risk of erupting into a massive ball of fire. Inventions and out of the box thinking have added to our lifestyle in big ways… and sometimes it may not be so good.

Advancements in technology are great, however it seems that sometimes there may be too many options available at our fingertips and this can, at times, create an illness that doctors refer to as “too-much-crap-itis. It’s an illness I myself have been plagued with for what seems like an eternity and just can’t shake. Every damn time I walk into a motorcycle dealership, swap meet or rally I always come out with more stuff than I can pack in my bagger. It. Never. Fails. In fact, it is much like shopping for groceries on an empty stomach. You walk in planning on purchase enough food for a week and walk out ready to stock an emergency shelter able to sustain 12 people for a year. Believe me… my garage can attest to the fact that I own way too much motorcycle crap.

I know, I know, that last sentence was motorcycle heresy and some of you probably think I need to be burned at the stake to set an example for other wayward motorcyclists. However, the fact that clothing, accessories and other riding gear has become flush with ample options is undeniable. I am certainly not decrying the fact that there are plentiful options for motorcyclists. On the contrary, I am thrilled that we have many choices to outfit our motorcycles acceptable to our needs. My argument is that many Riders these days feels obligated to purchase them. In fact, manufacturers have done such a good job advertising their products that many Riders feel if they do not purchase said wares they feel less like a Biker, almost unworthy to hang with the “real Rider” crowd. These feelings are patently and laughably absurd.

For anyone just beginning their riding lifestyle let me fill you in on a little history. Since their inception, motorcycles used to be a lot like camping. It was, for all intents and purposes a “poor man’s” sport; something you could do without much cash and many people took to two wheels for this reason. Nowadays however, it seems as though you need a Swiss bank account and several Rolex’s to walk into some dealerships and sit on a bike. Major rallies are no different. If you ride into say, Sturgis for example, with no less than $1,000 for a couple of nights you’ll be sleeping on the side of the highway eating bugs and drinking drain water. Costs have become absurdly high and much like campers have morphed from glorified tents to palaces on wheels, motorcycles have done the same. They’ve gone from a “poor man’s” sport to a rich man’s hobby and the old school way of doing things is fading like a sunset over the Rockies.

It is important to remember that if you are a new Rider, or one that thinks you need the latest and greatest gadget to come out in order to “fit in” I want to encourage you to re-center your way of thinking. There are PLENTY of ways to get around the bottomless income pit of despair the motorcycle and banking industry tries to throw new and unsuspecting Riders into on a daily basis. Below I will list some (hopefully) helpful ways for you to get from the death grip of debt and onto the road, where you’ve wanted to be all along.

1. Need vs. want
Sure that brand new, sparkly two wheeled supercharged animal sitting in the center of the dealership looks nice and yeah it can go from 0-60 in 3 seconds, but is it worth the cost..? Generally speaking motorcycles (and cars for that matter) lose 30 to 60 percent of their value in the first four years. Now, I know most of you who ride a certain type of motorcycle that rhymes with “BOG” may argue that the particular brand is impervious to this statistic… but I can assure you from every study, finance blog and financial report I’ve studied (and selling five of the bikes myself) that is patently untrue. Every vehicle depreciates, motorcycles more than most especially if the mileage gets above 20k. The good news is, if you want to save a little scratch and are willing to ride a previously owned bike you can let the other owner eat the depreciation, add-ons and taxes. You could literally make out like a bandit and nearly steal that thing. For example, the bike I currently own is a 2012 H-D Road Glide Ultra. When I purchased said bike it had about 20k miles on it and a freshly rebuilt engine. The dealership had used it as a rental and before they sold it to me, had to redo the engine due to a knocking in the jugs. After spending over 9k on the massive rebuild (and I have receipts to prove it). I walked away with the bike 2.5k under blue book, stock. I avoided the depreciation, the engine upgrade costs, the taxes and the labor that would have gone into the build saving me around 15k total. Now doesn’t that sound like a good way of getting a ride? Also, now more than ever in the history of selling motorcycles, dealerships are FLUSH with used bikes. I’ll get into why in a different article but just know there have been rumblings in some corporate board rooms of buying up massive quantities of used rides and shipping them overseas at a loss, just so those companies can continue the process of fleecing their customers with new rides. THERE ARE TONS OF GREAT USED BIKES, take advantage of that fact instead of the salespeople taking advantage of YOU! The next time you go into a dealership looking for a brand new scoot remember that the paint fades and the chrome dulls, but your payments won’t change on a new price tag.

2. Get yourself financed
The best way to walk into any wheelin’ dealin’ negotiation is to pay cash, but if you just can’t wait for the piggy bank to get full enough to buy a bike flat out, get a good bank (emphasis on the GOOD) to finance you. These days, most companies and manufacturers (motorcycle ones not excluded) are finance companies FIRST. They make the majority of their income not on selling the bike, but the money they get from the hundred years of payments you get stuck with. In most cases, if you stick with your repayment plan you’ll end up paying for your bike plus nearly another one, when it’s all said and done. It’s insane but done every day and I’ve heard stories of some dealerships and salespeople literally laughing about how they stuck someone with huge payments and a sky high finance rate. It’s sick and maddening but if you don’t go in armed with knowledge, you could be the butt of their next joke. Here’s what you do: Find a bank (or preferably a credit union) and look for the lowest finance rate they offer. If you get pre-approved for a predetermined total you’ll know what your credit score is, the rate you have and how much you can spend on your new ride. Armed with this, you can walk into any dealership and talk bottom dollar, not payments.

3. Remain focused
Salespeople have a lot of tricks up their sleeves to derail your idea of saving money. I don’t want you to think this is a “bash on the business” article, but it is brutally honest. If you aren’t careful, by the end of purchasing a bike you will probably curl up in a corner and cry for some time after finding out what just happened to your unsuspecting wallet. For instance, salespeople like to talk payments mainly because it throws your focus off the final price and onto a small number that seems manageable. Typically companies find that you’ll pay the inflated price, if they can stretch it out over 12,000 months. This tactic costs even more for you because the interest stays there a flares up, much like herpes in your body- it’s always there and very unpleasant. Talk final price and stay focus on what you can afford. If you stick to your guns chances are, that price will go down.

4. Baby, walk away
When looking for a new scoot a lot of Riders (myself included) tend to get tunnel vision. They see a bike that is “the one” meant for them. Every other bike in existence starts to fade away and there is only “that one” they want. Maybe a rainbow comes forth from the sky and lands on that motorcycle as doves fly above and angels play harps (or am I the only one that happens to)? I implore you to remember that each day thousands of motorcycles are manufactured and sent around the world. Believe me, there is ALWAYS another bike. If you get tunnel vision, the salesperson has you. Be prepared to walk out the door. In fact, many negotiations happen in the parking lot or over the phone after you arrive back home. If you walk away, you retain negation power that will save big bucks while giving you something to brag about to all of your friends, who probably got the shaft when buying their bikes.

In summation, over the course of my riding career I have owned many rides both new and used. Buying new and used equally has pros or cons but I can unequivocally say that if you do your homework and finance yourself, you will never regret it. To quote the financial wizard Dave Ramsey- “You will either tell your money what to do or the lack of it will always manage you.” Get your head right, your wallet in line and your focus on the prize. Remember, I want you out on the road enjoying your bike, not stuck in some bank’s pocket.

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