For those that have holdings in the Uhaul Investors Club they have some new rates coming in the next week or two.
The new rates will be –
The new rates are about 1% higher than the current rates.
Further information on this alternative investment can be found here.
The 2 year rates seem comparable to rates available in CDs.
One key difference is that a bank CD is backed by the FDIC. Pretty secure.
The uhaul notes are essentially unsecured debt. They are technically secured by what appear to me to be old, nearly worthless assets (12 year old wooden storage boxes), or by used moving pads (good luck figuring out which ones support your note if you have to collect against them) so if there is a default, it seems to me that there is unlikely to be much asset value to fund a recovery for the lenders.
I am not throwing rocks at U-haul, just pointing out that IMHO the rates they offer seem pretty low for unsecured, low priority debt.
Of course, like everything in investing, opinions vary widely.
Just an update Uhaul is promoting an 5% 8 year note. Of course these notes are secured by the company itself.
Tim and everyone reading here, are you planning on investing in these Uhaul securities?
It’s not whether you’re right or wrong, but how much money you make when you’re right and how much you lose when you’re wrong. I am Azure
Azure–I have a fair amount of money there now–back when rates were zero I put a few years of IRA money into them.
Tim, thank you for your reply and please know how much I appreciate and value you and what you alone have built here. With the Federal Money Market at Vanguard yielding 4% and shorter term treasuries yielding a bit more, it’s hard to believe UHaul will attract too much cash right now. UHaul is extremely strong and resilient to any recessionary pressures, so they really don’t “need” the money. I’m sure I have posted that I sold my large boat and RV storage facility late last year in Ocala, Florida. We were a key UHaul dealer for many years and it pained me to stop being a franchise with them; I desperately needed the spaces and was able to cut back payroll once we didn’t need a separate full time employee to do UHaul. UHaul is run extremely well and it really is a cash flow machine built on earned trust and a great reputation for service.
Happy holidays to you and your family, Azure