If you've ever played a round of golf, there's a good chance you've dreamed of hitting a hole-in-one; there's also a good chance you'll never get so lucky (the odds for the average player to hit a hole-in-one are 12,000 to 1). So, imagine not only hitting a hole-in-one, but doing so during a tournament where a lucky shot wins you a brand new Porsche 911 Carrera Cariolet. That's exactly what Brian McLean did on the 170 yard, hole 12 during the Member Guest Invitational at the Country Club of Rancho Bernardo last month.
Sticker price for the new Porsche is $108,000. This means, if McLean accepts the Porsche he needs to come up with $35,000 to $40,000 in order to pay taxes on his prize (the value of the Porsche is considered income). For some, this might seem like a small price to pay for a brand new 911; a way to get a new Porsche super cheap. However, McLean already owns a Porsche (a 1995 cabriolet) and as a financial adviser and president of BDM Wealth management he knows that the new Porsche will depreciate fairly quickly.
It's a Tough Decision
That's why, nearly a month after hitting the winning shot he's contemplating taking a cash payout from the company that insured the hole (hole-in-one insurance is quite common in tournaments like this) instead of the new 911.
“This could be my chance to get a new car, but it goes against the grain,” McLean said. “I never buy a new car because it depreciates so much in the first few years. I keep telling myself it’s hard enough to get a hole in one, much less win a Porsche — this is crazy,” McLean said. “But it’s a good problem to have.”
With the cash in hand Brian can take what's left after taxes and maybe buy another used Porsche. What would you do, pick the color of your new Porsche or take the cash and go from there?
Brian, if you're reading, let us know what you decide. I say keep your 993, take the cash and get a 2013 Boxster as they are an absolute blast!
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[Source: Union Times of San Diego Picture via Porsche of San Diego]
I would take the cash payout too! Sadly as he said they depriciate. He already has a 911.
Poor baby…and how many years will it take to depreciate $60-65,000? Wish I had that problem! ([:-))
Take the cash. After taxes, you can do so many other possible things. If he desires a newer Porsche, and since he already has a 993, he could chose to sell it to leverage off the income tax bite, and then buy a REALLY NICE 3-4 year old Porsche of his choice, and perhaps one with a CPO warranty. Best of both worlds.
Or keep the cash for his kids (grandkids) college. I’m certain that opening a 529 Plan has crossed his mind.
I thought I was going to come up with an original comment, when I started reading, but PP has already anticipated my answer – turn in the Carrera for a new Boxster. I would do that even though I would have to rent a garage for it. My ’10 Carrera S Cab is too good to give up, and my wife won’t part with the Cayenne, so . . .
If the cash payout is anywhere close to the value of the car, cash hands down.
I’m glad Brian is NOT managing my $$$
The bottom line is he’s getting a $108K car for, say, $40K. If that isn’t a spectacular deal…then what is ?
I wouldn’t turn it down
Take the cash and run…………….!
I completely agree with Tony. Pay the $35 – $40K in taxes and then immediately sell the car and realize at least a $60K windfall.