Travels With Miranda

On Fridays, I write about financial issues that affect Canadian Full-Time Rvers.

Having an RV is like owning a house: things break and wear down.  Even the best RV comes to an age when things start to fail one after the other. It can become tempting to over-exaggerate these routine costs and use them to justify purchasing a new rig.

Even if over the course of a year the water heater needs a new circuit board, the furnace motor burns out, the converter stops working, and the fridge quits, the total cost of replacement parts will be much less than the cost of a new rig.

Structural issues, such as rotted out floors or walls, might also be more cost effective to repair, depending on the spread of the damage and whether there is any mould present.

When crunching the numbers, look at the cost of replacing the current rig with a comparable new one. Keep in mind that new RVs are not without trouble and that newness does not guarantee a rig won’t be a lemon. Then, calculate the cost of routine repairs, some upgrades, and a couple of emergencies over ten years. Chances are keeping the old, well broken-in, RV will be more cost-effective.

On Fridays, I write about financial issues that affect Canadian Full-Time Rvers.

RVers shopping for a used rig may miss out on a good private deal because they find the paperwork overwhelming, are worried about the financial transactions not going smoothly, and are having trouble getting financing in the form of a loan or credit line.

The solution is to have a dealership broker a private RV sale.

The dealership will arrange all the paperwork, set up the financing, and handle the financial transactions. This service is paid for by the financing company and does not cost the RVer anything. There are no hidden costs here; if the buyer and seller have agreed on a sales price of $50,000 with $5,000 down, then the amount financed is $45,000, plus interest, unless the buyer wants to finance the provincial sales tax as well.

Dealership financing can offer more advantageous financing than taking out a regular loan, offering lower interest rates and longer terms that make the RV loan similar to a mortgage.

It is even possible to use a dealership in another location without ever meeting in person, using courier and fax to transfer documents.

There are many good used rigs available in classified ads. Using a dealership to broker the deal can open up many more opportunities to the shopper hungry for a great deal and a hassle-free transaction.

On Fridays, I write about financial issues that affect Canadian Full-Time Rvers.

A full-time RVer who has worked in several provinces or changed residency over the course of a year may worry about complications at tax time. It’s actually very simple. You owe taxes to the province where you were residing the December 31st of the previous year. If you worked in a province with a higher rate than that in which you are claiming, you will likely get a refund and vice versa.

As a very simplified example, take the case of a Quebecer who earns $50,000 for the 2008 fiscal year. That person would pay a combined income tax rate of 38.37%, or $19,185.

The next year, that Quebecer has earned the same amount of money while working in PEI for eight months before switching to Alberta residency in late November. That person is now at a combined Alberta income tax rate of 32% and owes $16,000, for a tax savings of $3,185.

Where it gets interesting is that this person would have had tax withheld at PEI rates, 35.80%, which means that too much tax was paid an a refund would be available. In the reverse scenario of moving to Quebec, more tax would have to be paid at the end of the year.

Of course, changing provincial residency is not a simple matter, but if the full-timer can provide proof of eligibility for residency in a province with lower income tax than that they were working in and switch over before December 31st it could be worth their while.

On Fridays, I write about financial issues that affect Canadian Full-Time Rvers.

With our centralized national bank system and the Interac network, banking for Canadian full-time RVers is a cinch, even when out of the country.

Generally, a bank is picked because it provides the services you need within a tolerable fee structure. A full-time RVer needs to consider one final aspect: accessibility.

While it is possible to do a lot of banking online or by phone, some things still require a physical presence. A full-timer will want a bank with a lot of branches and ATMs. It’s this consideration that pretty much rules out credit unions as suitable financial institutions for full-timers, unless they spend most of their time in the area where their credit union is located. When you lose or damage your ATM card, knowing that your bank has a branch around the corner means peace of mind.

The full-timer will also want a bank that has been a leader in online security since the late 1990′s with a highly usable website. This website must allow you to do almost everything online, including paying bills, moving money between accounts, requesting a credit product, ordering cheques, scheduling pre-authorized payments, tracking your investments, and more. There must also be a mobile banking application for a smart phone or wireless device.

Finally, when you don’t have access to the internet or want to speak to a live person, you need a bank with a toll free number that lets you reach a live person 24/7.

There is only one Canadian bank which meets all these requirements, CIBC.

On Fridays, I write about financial issues that affect Canadian Full-Time Rvers.

Insuring your full-timing RV isn’t the same as insuring a vehicle. Here are some of the things your full-timing RV insurance policy should cover:

• Replacement value that will enable you to replace the RV in the case of a total loss

You don’t want to be insured for just the value of the RV as that amount will depreciate over time. This is especially important for RVers who finance their rigs. You do not want to owe $40,000 on your RV and only have it ensured for $25,000.

• Contents

A common mistake people make when insuring themselves is undervaluing their possessions. The thing to consider is not their current value, but rather their replacement cost. Make sure special items, like jewelery have their own insurance.

• Stored items

Many RVers store items or carry excess belongings in their tow vehicle. Ensure that your insurance policy covers these items since they will not be covered by your tow vehicle policy! You also need to ensure that anything left in storage, whether at a friend’s or at a storage facility is covered.

• Liability

A homeowner would be covered by the liability clause in their insurance policy in case someone injured themselves on their property and then sued. You need to ensure that your RV policy has a liability clause that will protect you if someone trips going down the stairs of your RV or walks into your awning and splits open their forehead.

• Generous Per Diem

If your RV needs to be in the repair shop for any length of time, ensure that your RV policy has a generous per diem or other compensation clause that will cover the cost of a hotel room, food, and kennel boarding for your pets.

Canadians are lucky to have an insurance company that provides for all of the above cases and more with RV insurance policies specifically tailored to full-timers. This company is Aviva. It has brokers all over the country.

Aviva’s rates would probably shock the new full-timer seeking their first RV insurance policy. The author pays only $750 per year for a policy that offers complete peace of mind.