Fiscal Responsibility

[n2advnture]

This has been on my mind for quite some time and only write this with the most heartfelt intentions.

I have noticed something that is a little disturbing to me but really none of my business but as a friend to many, I thought it best to express my views. (especially with newer/younger BOTLs)

The problem?

I've noticed many BOTLs who are over extended on their credit in the name of acquiring more cigars. I've heard some disturbing balances being maintained on their credit cards due to large number of purchases of cigars.

I believe that with the amount of discussions in the forums, pictures of collections being shown, crazy sales by retailers, that it is easy to get caught up in the "keeping with the Jones'" mentality but I would be remiss if I didn't express my concern.

PLEASE keep in mind that cigars are a hobby and should be BUDGETED for and is SOLELY based on disposable income. You SHOULD NOT be "investing" in cigars - they are a consumable that are susceptible to damage (fire, water, improper storage, beetles, theft, etc...).

People talk about a "cigar budget" and we all laugh when we blow that budget. But like any other aspect of your life, you REALLY should have a "cigar budget" and stick that budget the same as you would for emergency savings (6+ months), vacation savings, retirement, etc...

The senseless act of carrying credit card debt just to amass a cigar collect is not fiscally responsible and you are doing yourself a disservice in the long run.

The one thing that I have learned over the nearly 2 decades of being into cigars is that it's is not about the cigars. The cigars are just a compliment to the commaradarie. Yeah, the cigars are good but meeting new people and developing longer term friendships has been the best part of the hobby to me. There are many people that I now consider friends (some stay at my home) and I wouldn't have met them otherwise.

My point?

In the great scheme of the cigar community, cigar are meaningless and should not be coveted to the point where we throw away common sense and fiscal responsibility.

So please, take a step back and look at YOUR financial plan (if you don't have one, then make one!). It is your responsibility to take care of your financial security.

Happy smoking my friends.

~Mark


.

[Diesel Grinch]

Very true Mark. It's easy to get excited and lose your way. Always remember a box pass, box split, cigar draft, PIF, or anything else will always be their. Don't over extend yourself just to play.

Happy Thanksgiving all!

DG

[King Catfish]

I agree. I had to adjust my cigar budget severely lately because it was getting away from me a bit.

[DeeDubya]

Some really good advice, especially at this time of year.

I prefer to put the blame on credit cards instead of cigars.

[CAJUNBLAZE]

Good advice for newbies such as myself, it is very easy to get caught in the specials offered!

Rich

[Cabaiguan Juan]

Amen. My budget is ductated by the pay check i get at my part time gig. The Day job is for the Shorter Half and I's living expenses and whatnot.

[craig]

Y'know, I agree with this for the most part - credit card debt is BAD - but ... when times are bad, the smart money buys. The key assumption is that you MUST have money, of course.

Besides the general economy, there are two other factors:

1) SCHIP is coming. If we assume that it is 40 cents a cigar, then that's $10 on a box of 25. I don't know if there will be a floor tax (tax levied on existing stocks), but if you smoke $2 cigars, that's quite a hit.

2) Cuba has been hit HARD by the hurricanes. The tobacco wasn't planted, but many curing barns have been lost. This means prices will naturally rise in a couple of years solely due to the upcoming lost crop. If that is further combined with the suspension of the embargo, then CC's will go through the roof. Unfortunately, it is only boxes that remain sealed that will be worth sitting on for investment purposes.

YMMV

[drew_goring]

Y'know, I agree with this for the most part - credit card debt is BAD - but ... when times are bad, the smart money buys. The key assumption is that you MUST have money, of course.

Besides the general economy, there are two other factors:

1) SCHIP is coming. If we assume that it is 40 cents a cigar, then that's $10 on a box of 25. I don't know if there will be a floor tax (tax levied on existing stocks), but if you smoke $2 cigars, that's quite a hit.

2) Cuba has been hit HARD by the hurricanes. The tobacco wasn't planted, but many curing barns have been lost. This means prices will naturally rise in a couple of years solely due to the upcoming lost crop. If that is further combined with the suspension of the embargo, then CC's will go through the roof. Unfortunately, it is only boxes that remain sealed that will be worth sitting on for investment purposes.

YMMV

Why would a opened box not command the same price as a sealed one? Personally (and I am not a "collector") I would rather purchase open boxes if they are aged so they can be inspected and such.

Great posts Mark. Definitely something for all of us to think about.

[craig]

Why would a opened box not command the same price as a sealed one? Personally (and I am not a "collector") I would rather purchase open boxes if they are aged so they can be inspected and such.

Great posts Mark. Definitely something for all of us to think about.

+1 on the posts, I forgot to put that in my original response (was running out to a meeting).

As for open boxes, the answer is fakery. Since the Cubans went to standardized sizing across brands, it has become extremely easy to do upmarket fakes. If somebody puts Cohiba bands on RyJ's, and puts the result in a Cohiba box, then it will be awfully hard to see that fakery. The money isn't as good as glass-top Cohiba's, but it may well be in a couple of years .... there's a reason why B&M's here will not give out un-mutilated empty dress boxes unless they know you.

When cigars are auctioned, the auction house is essentially guaranteeing authenticity. Sure, if the boxes came from an estate, the provenance can be demonstrated, but there isn't much use in buying for profit if the profit goes to your estate! OTOH, if you're buying extra boxes in anticipation of a windfall profit in a couple of years due to the hurricanes this year and a potentialy lifting of the embargo, then a sealed box is going to sell faster and for more than an unsealed one IMHO.

I have been debating extending myself a bit because 25% per year potential profit (my guess) is appealing, but I have pretty much talked myself out of it as I'm only interested in "collecting" for the purpose of destroying (smoking) the collection, so the profit is irrelevant. I crack open every box the moment it arrives. If the cigars are in a dress box, then I re-package the cigars in jars or old cabs right away, so the only record of the age of a cigar is what I write on the jar label - hardly a means of authentication

[denver24]

I second everyones posts. In the current economic climate, cash and frugalness are the names of the game until stability and general job security return. It's a bummer, but my cigar budget is almost non-existent and will remain that way until prosperity returns. Damn economy!

[nhcigarfan]

Coming from a vendor folks with this problem should listen. He can only loose from his advice.

Mark is a stand up guy.