Don’t just say ‘no’ to any particular purchase or investment. Run the numbers to see if you can afford, say, a boat. Then think about whether it’s worth it to you. (Ben Garver/AP)

“A boat is a hole in the water you throw money into.”

“The two happiest days in a sailor’s life are the day he buys a boat and the day he sells it.”

I have a somewhat unique perspective on dispensing financial advice. I run an asset management firm. We hear all manner of terrible advice that our prospective clients have received elsewhere. (No, owning physical gold and the SPDR Gold ETF does not mean you are diversified.) Conflicted advice, thoughtless portfolio constructions, high-risk low-return bets and debunked financial myths are just the tip of the iceberg.

I also write about investing. Hence, a natural tension exists: Good investing is boring and long-term, while good writing tends to be emotionally appealing and punchy. It’s a trade-off, and I understand how nuance and subtlety can be lost in the media’s hunt for clicks.

This came to mind recently when I read an intriguing column headlined “Never buy a boat.” As a boat owner and lover of the seas, I found it an amusing discussion. But as a financial adviser, I was sorely disappointed.

I am sure you have seen many other such “lessons:” Houses are money pits. Don’t drink expensive lattes. Never install a pool. Don’t go to college. Golf is an expensive hobby. Don’t invest in a 401(k). Never buy a high-end sports car.

Merely saying “no” is not financial advice; it is a form of blind risk avoidance. The problem with such advice is twofold. First, it misunderstands the purpose of money. Second, it fundamentally misses out on the best way to make intelligent financial decisions.

Money, for all its glory and the trouble the blind pursuit of it has caused, is misunderstood by many. No, money is not the root of all evil. The problem is people and how they behave around it.

Money is merely a tool, a medium of exchange. Its value is that it allows its owners the freedom to make decisions that those without it cannot.

At its most basic level, money allows sustenance and security: Food, housing, clothes, medical care and transportation. Get a little more of it and you can pay for your kids’ education, and take a vacation now and again. Freedom from worry is a nice benefit of having enough to cover the above. If you’re fortunate to have more than enough, then other choices emerge: philanthropy, entertainment, hobbies, travel, whatever indulgences catch your fancy.

Which brings us back to our boat: Assuming you have enough cash and/or credit, using some of it to buy a boat is simply an option, one that should be considered intelligently.

Let’s start with the costs. There is the purchase price, which experience teaches us is the smallest expense of boating. Where will you keep it — at a marina slip (most expensive but most convenient) or a mooring (cheaper but less convenient) or trailer (cheapest but least convenient). You might own a dock, but that means you spent a lot of money on related real estate. Maintenance and repairs are not cheap, especially if you are out in saltwater (as opposed to freshwater lakes and rivers). There are issues of winter storage if you live in the north, and then prep for boating season. Fuel and insurance are costs, as, of course, are food and beer.

These are all easily calculable by anyone with a spreadsheet (or even a pencil and paper). You should be able to determine pretty accurately what a boat will cost you; assuming you have a household budget (what do you mean you don’t?!), then you should also know how much boat you can afford.

There are many other questions: How much are you going to use it? What friends and family will accompany you? Who else do you know that boats? What other time demands do you have? Think about these and other questions, and you can determine (a) if you can afford a boat and (b) if it’s worth it to you.

We can run through the same exercise for just about any expenditure, from that latte to a vacation home. Just saying no is lazy, and misses the point of money as a tool.

Let me suggest better advice than “never ever buy a boat.” Try the following: “Don’t buy things you cannot afford, won’t actually use and that could cause you more pain than pleasure.”

I have many friends who are boaters. One bought a 14-foot kayak and goes out every morning (weather permitting) for a robust paddle. His blood pressure is down, his outlook is sunny, and he enjoys the solitude on the water. Another friend bought a 55-foot behemoth. It’s a floating hotel, comfortable and luxurious. He hardly ever used it — and sold it at a big loss after a year.

So my advice for people considering buying a boat are to recognize four key issues: knowledge, costs, skill and psychology. For our wannabe boater, or anyone making a major purchase, it looks something like this:

●Understand what you are getting into.

●Carefully consider all of the costs of ownership.

●Only buy what you can afford.

●Make an intelligent decision about using your limited time and money.

This is a useful approach, more thoughtful than merely saying “No!” to anything with a price tag attached.

Not surprisingly, you can apply the same approach to any financial situation. Consider assessing an investment:

●Don’t buy anything you don’t understand.

●Watch the fees on all of your funds, investments, advisers, etc.

●Be smart about your own skill set in beating the market with stock selection or market timing; you are likely better off with an index fund instead.

●Understand how markets behave, and only risk what you can tolerate going up and down with market volatility.

Knowledge, costs, skill and psychology: running any issue through these four filters is not magic, but it does force you to consider important issues you might have otherwise overlooked.

If you want a boat – or something else equally costly – don’t make a snap yes or no judgment. Instead, frame the question in terms of these components. It will lead you to intelligent decision making.

Ritholtz is chief executive of Ritholtz Wealth Management. He is the author of “Bailout Nation” and runs a finance blog, The Big Picture. On Twitter: @Ritholtz.