Fred categorically does not exist.
He only manifest when Phoebe Cates is going through tough times. First when her parents are fighting and splitting up and again when her own marriage is falling apart.
He is the manifestation of her having a mental breakdown.
Similar to Fight Club, sometime she SEES Fred doing things (like looking up the skirt) but sometimes she is the one actually doing the things (the physical things)
She does sink the boat and do all the other terrible things, but not consciously, she is basically schizophrenic.