Wednesday, September 20, 2017

FIre Engine Budgeting: Where to start

Your department desperately needs a new fire truck. How much can you afford?

I get calls like this every day asking just that question.  And sometimes, the answer is not good.  After all, you don't want to spend hours designing a truck only to learn you can't afford it.

There are 2 approaches to fire truck budgeting

First, it's to select the truck and then find a way to afford it.

Second, it's to determine how much you can afford and then build a truck that fits into your budget.

Neither is "the right way" but each approach has its advantages and disadvantages.

I'll discuss the two approaches over the next two weeks.

In the meantime, check out the free Fire Truck Budgeting Kit to help do the math.  Click here to download your free copy.

Summary

Budgeting is tricky.  If you don't do it right, it can jeopardize the whole purchase.

Stay safe!
John R. Hill
President
First Bankers

Wednesday, September 13, 2017

Fire Truck Financing: Current money conditions

If you are planning to finance a new fire truck soon, what should you expect?

Interest rates are still low, in the 2% - 3% range, depending on how long you finance the truck.  They have recently been increasing.

The Federal reserve has been very open about its intention to increase interest rates.  It has raised rates twice this year and has communicated its intention to raise rates one more time by the end of the year.

It may be wise to start locking in your financing to stay ahead of future higher interest rates.

Summary

Rates are still low but going up.

Stay safe!
John R. Hill
President
First Bankers

Wednesday, September 6, 2017

Fire Truck Financing: Stupid Easy Money-Saving Idea

This is the easiest money saving idea when financing your new fire apparatus

Most callers do not realize that you can select when you schedule payments during your fiscal year. 

Most callers want to defer payments to 1 year after delivery.  Or schedule their payment somehow in relation to the delivery of the truck.

But they fail to understand how this can save money

A financial expert would advise you to schedule your payment in relation to when you receive your money, not when the truck delivers.

Most fire departments receive their money once or twice a year.  By timing your payment to when you receive your money and not the truck delivery, you can save about $6,000 on a $500,000 truck.

Without doing anything else.  No lower rate, no bigger down payment, no shorter financing term.  Just this one thing will save money.

Summary

It can be difficult to know all the right choices when financing a fire truck.  This simple idea will save money without major changes.  It should also make paying the payments easier as the payment is due when you are flush with money.

Stay safe!
John R. Hill
President
First Bankers

Wednesday, August 30, 2017

The fire truck financing savings trick no one ever finds

Our goal when helping a fire department is to share our knowledge so that fire departments don't make a financial mistake.

A mistake can happen when the financing jeopardizes the next truck purchase, weakens the department's overall financial status, or wastes a lot of money.

Here's one huge money saving idea that no one thinks about

Most fire trucks take several months to build.  And delivery usually takes place in next year's budget.  But everyone only thinks about what savings they have today to calculate how much down payment they can afford.

We regularly show fire departments how to use their current savings PLUS money from their next year's budget to calculate the largest down payment possible.  By doing this, the department borrows less and therefore pays a lot less in borrowing costs.

This idea usually saves well over $10,000 - $15,000 in interest.  Savings that can be used for other needed equipment.

Summary

Don't be fooled into calculating your down payment simply by how much savings you have now.  Your down payment should include what you have now and what you will have when the truck delivers to maximize your savings.

Stay safe!
John R. Hill
President
First Bankers