Charting Boating Costs

[Tom.B]

In an attempt to control costs, set a budget for next year, and just out of curiosity I went through all of my receipts (I keep them all) since buying our first boat back in July. I sorted them into a dozen or so categories. After simply entering the data into Microsoft Excel, I was able to have it sort the data into a small pie chart. I thought it would be interesting to share this chart with you guys.

Let's talk about the differences that other boaters have that may differ from this and thanks for all your input.


A few things to note:

I do almost all my own repair work, so I segregated what I had to pay for the labor of others into its own category.

The 'Big 3' (payment, insurance, and slip fee) constitute 53% of all costs.

A few things that I left off (and do not track) are things like extra fuel for the cars to get back-and-forth to the coast, pet sitting costs, and the extra eating-out costs.

There are a few things on there that we needed to upgrade when we bought it and show in the percentages, but will never be bought again. Things like mattress, 2 radios, 2 antennas, curtains, bottom paint (for a while anyway), tools etc. That said, it's not that there will not be more of these costs in the future, what I am noting is that we are primarily down to things we WANT to buy and have nearly all of the things we NEED behind us. The major cost still ahead is a $2000 bimini job.

Transient costs are just docking fees at marinas we visit.

Nav Aids are charts we bought, but I included magazines and other educational publications we have bought.

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[sunchaser]

Wow - adding up the costs takes all the fun out of it. I'd rather enjoy the experience.

If you really want to go nuts, add up all the sales receipts, 1099s, 1040s, sch Cs and state forms etc that show "TAXES." Talk about depressing!!

 

[Tom.B]

True, but being on the borderline of income earning that allows us the luxury of our boat, we NEED to stay on top of spending. If we waited until we KNEW we could afford it, we'd never do it. We felt that we needed to gain experience with larger boats now, so that later, should we decide to go cruising full-time, we'll be ready. PLUS, all our friends are jealous.

 

[skipperdude]

You showed the %. How much in the bucks?
SD

 

[Tom.B]

I'd rather not give numerical values. I don't want it to be a d*ck-waving contest and don't want to give you guys a financial statement of my boating life

. More of just a discussion about what percentages go to what categories. Basically where it goes, not how much goes there.

 

[skipperdude]

How long have you had the boat? I see your fuel expens is pretty low. My biggest expense is (after slip fees.) My boat is paid for.

Is the Go juice.

Got all my re's done. required, rewired, repaired ,replaced or repainted.
Guess what last two trips out. Nothing broke.

Now it's jump on and fire that puppy up. I'm a happy skipper.

SD

 

[Tom.B]

9 months (We burn less than 2 gph at cruise, but haven't done a ton of cruising yet. Just out on the river, learning our way around... And lots of that time was winter.

 

[Marin]

GonzoF1 wrote:

In an attempt to control costs, set a budget for next year, and just out of curiosity I went through all of my receipts (I keep them all) since buying our first boat back in July.

Well, there's your first mistake.* If you own a boat (other than a little trailer boat) and you have the delusion that you are going to control costs and set a budget, you've taken up the wrong pastime.* The boat and nature control costs, and your budget is set by the marine stores where you buy your stuff and the yards where you have work done.

Even at today's prices, fuel is such a small percentage of boating costs compared to insurance, moorage, electricity, maintenance, upgrades, and repairs that we don't even think about the cost of fuel.* It's what it is.

Boats have the nasty habit of nailing you with a massive expense just when you think you've got it under control.* Out of the blue, you find you need new engine mounts, or a new prop shaft, or a new exhaust system or a new toilet or..... the list is never-ending because unlike cars and houses and even airplanes, boats are in an environment that is destroying them every minute of every day.

What we've done is set up an account that's the "boat account."* We dump money in it every now and then and try to keep the balance up to take care of any big expenses that might come along.* Some years we never touch it, some years we use a fair amount of it.* None of this has been predictable.* You haul out for bottom paint and find a cutless bearing is working loose.* In the process of fixing that you learn that the shaft is out of true.* Then you learn that the shaft coupler is undersized for the job and that it would be better to install a new, heavy-duty split couple, which will help hold the shaft in true.* In the process of that you learn that the shaft is undersized for the new-style coupler.

So--- you started out figuring a haul out and bottom paint job, and you paid for:* a new shaft, a new coupler, new cutless bearings, a prop tune up (it was off anyway, might as well do it), the labor to tune, install, and adjust all this stuff, an engine alignment to the new shaft---- and a haul out and a bottom paint job.* So instead of spending perhaps $1000 you spent maybe $4,000, maybe more.

Boats are not investments, they're toys.* Unless you have a 1930s Gar Wood or Hacker in which case it IS an investment.* And toys were invented to give you something to do with your excess money.*

A pair of rules I was taught decades ago by a very successful businessman and have followed ever since,* 1) know the difference between essentials and toys and never finance your toys, and 2) don't try to budget the use of a toy.* If you can't afford to use it, you shouldn't have it.

I have no idea how much we've spent on our GB since buying it in 1998.* Probably enough to buy a second one.* But we enjoy the hell out of it, both using it and working on it, and we've met great people like Carey* and his wife because we have it.* So we couldn't care less what we've spent since 1998.* If we hadn't spent it on the GB we'd have spent it on something else.




-- Edited by Marin on Thursday 29th of April 2010 01:58:18 PM

 

[Tom.B]

Well... THAT was pretty friggin' depressing. You are not allowed to talk anymore on my thread! (just kidding, of course)

 

[sunchaser]

Right on Marin. Another one, "Never buy a boat from an accountant."

 

[albin43]

in my opinion you can budget anything, including owning a boat. the only thing your missing is a "risk factor". just like quoting a complex job that you havnt done before, you need that risk factor for when something goes wrong. also if people didnt finance there "toys" i think recreational boating would drop about 90%. let alone everything else ( cars, motorcycles ect)





-- Edited by albin43 on Thursday 29th of April 2010 03:27:53 PM

 

[Marin]

GonzoF1 wrote:

Well... THAT was pretty friggin' depressing.

Yeah, but.....* It's reality.* We were fortunate in that when we were making the decision whether to buy an old*GB or continue to charter occasionally, both the broker we used to find a boat and a good friend with 30+ years in the boating industry told us what we were in for if we decided to purchase a trawler-type boat.* The intent was not to scare us out of it but to make sure we didn't bite off more than we could chew.*

The point of boating is to have fun and enjoy the challenges it presents.* If one is struggling to stay ahead of the*operating,*maintenance and repair bills and the boat becomes a financial drain rather than a worthwhile expense,*the benefits of boating will be swamped by worry and frustration and the overall experience will be negative.



*

 

[Marin]

albin43 wrote:

...also if people didnt finance there "toys" i think recreational boating would drop about 90%. let alone everything else ( cars, motorcycles ect)

True enough.* Financing is a way for people who can't afford something to get it, and for people who are trying to sell things most people can't afford to sell them.

It all boils down to risk--- how much a buyer willing to risk to possess something.** So you bet your income won't go down, or will go up, you bet that your health will allow you to continue earning, you bet that your company or your employer will weather whatever financial cycles they are subject to, you bet on your ability to do what you do better than the other fellow who does what you do and who*would like to have your job.* You bet that your investments for retirement will*grow or at least remain stable. *And you assess whether or not owning the item you wish to possess is worth the risk of putting yourself in*debt to get it.

Every person has their own level of risk they are willing to*live*with. For me, a house and*property*are worth the financing risk.* Flying and boating--- our two most expensive*hobbies---*are not.

 

[Peter B]

Dammit Marin - you've been reading my mail again. My last haul-out - ostensibly for just antifoul and insurance inspection, (which required just the stern tube sleeve be replaced, ha ha), in the end, entailed a new muffler, propshaft, stern tube packing, and the sleeve of course, and what with that and the antifoul, came to a tad over $8000........! But it's all meant to be fun, and we are going out tomorrow in her for the long (Labor Day weekend here is Aus), so yippee....haven't been out in her since Feb 25th, so rarin' to go....now where should we head for....?
Absolutely agree with virtually everything else you all said, and if I ever wonder whether it's all worth it, I just think for a minute about what else I would rather do with my time...or money....NUS-SSING !

-- Edited by Peter B on Friday 30th of April 2010 12:59:28 AM

 

[Keith]

Where's your budget for maintenance?* I use a simpler formula that has seemed to work out well over the years.

1/3 is your payment
1/3 is your insurance, slip rental, scheduled maintenance, etc.
1/3 is unscheduled maintenance - breakdowns, replacements, fixing stuff, etc.

So take your payment and triple it, and that should be your average monthly cost of ownership.

Enjoyment of ownership? Priceless!

 

[Tom.B]

Marin wrote:If one is struggling to stay ahead of the*operating,*maintenance and repair bills and the boat becomes a financial drain rather than a worthwhile expense,*the benefits of boating will be swamped by worry and frustration and the overall experience will be negative.

Or if they spend anytime reading forums posts from a guy that obviously has cornered the market on a "Rain On Someone's Parade" Machine".

*

Struggling? Not really, but we are surely closer to the line than most of you guys when it comes to our finances. However, your assessment can be applied to just about everything and people would never leave the house. That is, if they even HAVE a house. We spent, when you spread it out over the whole year, our boat payment monthly just going to Jamaica the past 3 years. We just diverted those funds to this. The difference is that we now have a liquid asset should the situation change. We are willing to sacrifice what it takes to keep us boating and have the skills (or the ability to learn) to keep her afloat. We also chose wisely when it came time to buy Skinny Dippin'. She's in great shape and needs very little.

Do we worry about catastrophic problems? You bet. Just look at the 'Getting Used To The Fear' thread. Do we let it ruin the fun? Hell no. But we DO have to manage things in order to NOT let it get to a point where it's not fun. We have a free 10 year-old chart plotter that is a backup to our paper charts, we still have a cassette player, no new deck furniture, no inverter... the list goes on and on. So in order to HAVE the stuff we have (and to be quite honest, it's due in no small part to our decision to live our life child-free!) I need to stay on top of what is spent.

This was a total rambling and really went nowhere. Sorry. All I am saying is that if we all listened to your risk assessment musings (which is right), you'd be all alone out there.

 

[Tom.B]

Keith wrote:

Where's your budget for maintenance?

The categories; interior, exterior, engine and labor pretty much combine into that. I wanted to breakdown the maintenance costs to give a better picture as to where it goes instead of lumping it into one giant general category.

 

[sunchaser]

Conceptually, we all want to have enough money in the bank to take early retirement to go boating, flying and/or other seemingly useless endeavors. No parade raining here, but the missing link in the budget traking is lost revenue from applying "take this job and shove it."

I just told my boss I'm quitting, so lets see how long the toy money and personal good health last. SE Alaska, here I come

 

[Marin]

GonzoF1 wrote:All I am saying is that if we all listened to your risk assessment musings (which is right), you'd be all alone out there.
*

Not true.* Or it shouldn't be true.* There's a big difference between having a realistic idea of what the true cost of boating is and the financial risks that may be imposed by it, and simply cowering in fear and doing nothing.because "Something" might happen.

Everything in life is a risk.* Even going to bed at night is a risk because what if you don't wake up in the morning?* But just because something is a risk doesn't mean it shouldn't be undertaken.

My only point is that boats incur unexpected costs, often big ones.* So one should be prepared--- however they want to be prepared--- to deal with this.* You can say, "We'll worry about it when the time comes," or* you can set up a "boat maintenance" bank account, or you can list worst-case scenario costs to make sure that whatever happens with the type of boat you've selected you will always be able to pay for it.* Everyone has different ways to prepare for and deal with risk.

In the case of boating, the objective is not to avoid the financial risk by not boating, but to have a realistic idea of the costs that can be incurred so that you don't end up living in a box under the freeway.

"Don't finance your toys" is a rule we've chosen to live by.* That doesn't mean I believe people who do finance toys are wrong.* It's whatever works best for the person.

Keith's breakdown of ownership costs seems pretty accurate to me on a general basis.* But there is one other thing you need to factor into your cost calculations.* It's another downer but it's generally true---- whatever a yard, mechanic, electrician, or shipwright quotes you as an estimate to do a job on your boat, double it.* Because nine times out of ten, the final bill will be 150% to 200% higher than the estimate, so you might as well be prepared.* The same thing applies to their time estimates, too.

Alan Mulally, a past president of Boeing Commercial Airplanes who is now CEO of Ford had a saying that he felt expressed the attitude we should all take toward our business, even when things got frustrating.* It applies equally to boating.* "Remember, this is supposed to be fun."

 

[Tom.B]

See... Now I think that if someone quotes you a price, unless they can give a damn good reason the job will cost twice the estimate, I WILL hold them to it! That being said, however, unless something is completely out of my skill set (and not much is TBH) I do all my own work. At the VERY least, I may hire someone to assist me, or teach me the skill.

Otherwise, I do understand your risk versus reward argument. It's valid for sure. The real way to play it is to maintain it properly and that is, by far, the best way to control catastrophic costs. But more to the point is whether or not my current budget expectations - based on the graph - are nearer to what others are paying. Granted, my mooring costs are probably WAY lower than yours at $6.75/ft./month. I guess I was trying to see if 50% in the three fixed costs was about right.

 

[Marin]

I believe our moorage costs are 6-something dollars a foot right now. Maybe seven. I can't remember, they raised them recently.

And my wife and I do as much of the work on our boat as we can, which is most of it. It's one reason we bought an older boat--- so we'd have a sort of "hobby" fixing up the things that need fixing up. Things like new engine mounts, exhaust systems, new shafts, couplers, valve adjustments, the installation of a whole new battery setup, we leave to the local pros. But everything else, from engine servicing to wood refinishing (my wife has become an artist with a Makita heat gun), to toilet rebuilding to electronics installations to window rebuilding to canvas work, we do ourselves. This does a lot to keep ownership costs down, and for the most part (for us anyway) it's part of the fun of boating.

 

[Peter B]

It's all about being realistic, but without freaking out. Like Marin, I bought an oldie but goodie, which was basically sound, but tired, and needed work. I was able to purchase therefore with cash, but in the knowledge I would spend quite a bit of time and money on her doing her up. Now you may find this hard to believe, but a recent valuation has her now at twice what I paid for her. True. In our market here is Aus, one of these CHBs in good shape is regarded like an old but well maintained Queenslander house - a bit of a classic, and always sells and holds value well. I knew that when I went looking. However, I've got to get my fun out of her before I retire, because I had to use some super to buy her, and realistically, I doubt I will be able to afford the maintenance and those unexpected repair bills when no longer earning. That's the way the cookie crumbles I guess. A bit frustrating, as when one retires is the time in life when yah got the time....right? 'course I might win lotto - you never know. But I'm not holding my breath, and trying to get the most out of her while I can.
Hey Gonzo, that's one nice looking boat you have there. What design is it? If I was able to up-size, a sundecker with nice big aft cabin AND a decent outdoor covered living area instead of cockpit, is one way I could be tempted to go.