Your annual $ numbers

[bfloyd4445]

There is a wide range of a varying scale conundrum regarding using any specific percentage annual use cost “average” (i.e. 10%) to the original “fully paid for” purchase price of a boat; 1st time boat owners need to understand cost comparisons on a similar condition and style used 38’ boat (new boat cost comparisons and financed boat cost comparisons are a whole different boat-cost-game):

1. Used 38’ boat purchase price of $30K at $10K average annual usage cost... i.e. docking, repair, fuel, new items etc fees = 33.3...%
2. Used 38’ boat purchase price of $60K at $10K average annual usage cost... i.e. docking, repair, fuel, new items etc fees = 16.5...%
3. Used 38’ boat purchase price of $100K at $10K average annual usage cost... i.e. docking, repair, fuel, new items etc fees = 10.0...%

I use these simple figures (on 38’ boats that are in similar condition, using same annual use fees, but with widely varied purchase prices) to let newbie boat owners understand that annual use fees as an annual percentage of their original boat cost can vary hugely by their percent yet remain in a basically similar monthly dollar expense range. Today’s unsettled boat-value market can amount to wide swings in purchase price of similar boats, often depending on location of boat and PO’s financial/life condition. However, with that said, the annual use fees may stay in similar dollar-cost range due to pressures on yacht harbors to keep their prices attractive.

On post # 13 of page one in this thread I depict my general expenses that come to Total Annual Cost of $7,700 for $148 Bucks Per Week to own and enjoy our craft out and about on the water. Our Tolly, needing little in upgrades, was in great condition from day one of our ownership and we keep her that way. Our purchase price was affordable... due to PO’s circumstances/events. So, our reasonable $7,700 annual use-cost is far from 10% of the original boat price to us.

she is a bargin at 148 per week. Thats hardly more than a slip rental.

 

[SomeSailor]

~200 hrs/yr

$300-500 fuel
$200 registration
$1200 insurance
$8900 moorage (covered 50')
$5,000 - $10,000 maintenance/upgrades/cool toys

Boat is paid for, but we figure in cost of ownership at about $15K-$20K a year.

Don't smoke or drink so it's a cheap vice.

 

[sunchaser]

Some Sailor

Our fuel bill for about 5 gph, all uses in, is about $17 - 20/hour. Yours is $2/hour. That is one very efficient vessel you have - hybrid via solar panels?

 

[Marin]

Looking at yachtworld, it's easy to find listed boats (same make/model, similarly equipped) where the price of the boat can vary by a factor of 3 to 4. If older boat A is $100,000 and newer boat B is 400,000, I have a hard time thinking that boat A will only require $10K per year and boat B will require $40K per year.

That ten-percent-per-year formula has to be tempered with logic. A newer or better maintained boat will generally require less maintenance and repairs than an older boat that has been neglected or is simply experiencing "older boat" syndrome with issues that have not yet been addressed.

However....... A number of years ago I co-authored a coffee table cookbook with the executive chef of a 120' corporate yacht named Daedalus. (No, I did not write the cooking part of the book). The yacht, originally named A and Eagle, had been designed by Philip Rhodes and built in 1966 by Abeking & Rasumssen in Germany for Augie Busch, the then-CEO of Anheuser Busch. Over the many months I worked on the project I got to know the captain, Hal Burchard, who had hired me for the job and whose company managed the Daedalus for the corporation that now owned it, quite well.

One day I asked Hal if it cost a lot more to maintain a 1966 steel vessel that had, among other things, the first retractable active stabilizers ever used on a vessel this size, two huge Cat diesels, two big Northern Lights generators, a complete restaurant-style galley, regular flush toilets throughout, multiple staterooms, all sorts of electronic entertainment and business systems and all the boat systems associated with keeping all this stuff operational.

Hal pointed to a brand new, even larger yacht that was being commissioned at the next dock over and said, "That boat is brand new. But it has the same pumps and hoses and gaskets and light bulbs and faucet washers and electronics this boat has. So from day one the systems on his boat will start wearing out just like the systems on this boat are wearing out. So the cost to maintain his boat will be pretty much the same as the cost to maintain this one."

One difference Hal pointed out was that his 1966 boat had had all the bugs worked out. Every boat has surprises, he said. But by now he and his crew had experienced just about every surprise the Daedalus could come up with and had long since dealt with them. The owner and crew of the big new yacht next door were at the bottom of the learning curve for their boat, and many of the surprises they were in store for would be very expensive to deal with.

So old does not always automatically equate to more expensive, although there are so many variables it is impossible to come up with a hard and fast rule in this regard.

 

[psneeld]

Some Sailor

Our fuel bill for about 5 gph, all uses in, is about $17 - 20/hour. Yours is $2/hour. That is one very efficient vessel you have - hybrid via solar panels?

Same thing caught my eye...

 

[Moonstruck]

The yacht, originally named A and Eagle, had been designed by Philip Rhodes and built in 1966 by Abeking & Rasumssen in Germany for Augie Busch, the then-CEO of Anheuser Busch. Over the many months I worked on the project I got to know the captain, Hal Burchard, who had hired me for the job and whose company managed the Daedalus for the corporation that now owned it, quite well.

Marin, I was aboard that boat in the early 70s. It was tied up in Morehead City, NC at the Sanitary Seafood Restaurant dock. It was then the A & Eagle. I was talking to the engineer. He asked permission from the captain, and showed me around. They had a big mahogany dining table that must have sat about 16 people. I believe he said that it was around 137'. I later saw it tied up in Annapolis with a bunch of elected members of Congress on board for cocktails and dinner. That was a hard working boat.

In the 60s I was fortunate enough to supply much of the materials that went into A. G. Bush's home in Winter Park, FL. Quite a place.

 

[Marin]

I believe he said that it was around 137'.

The A and Eagle/Daedalus is 119'-3" LOA x 22'-6" beam x 5'-6" draft. Yes, that draft figure is correct and was one of Rhodes' design requirements. How he achieved it is an interesting story in itself.

The boat was sold a few years ago to a fellow in Vancouver who I'm told has or is in the process of totally restoring her hull which was getting too thin (the eventual consequences of that very shallow draft).

The previous corporate owner replaced her with a 150' yacht built in Seattle by Delta Marine. This boat has also been named Daedalus. The original Daedalus was always skating on thin ice with regards to the Jones Act. The new US-built Daedalus has eliminated that issue.

 

[rwidman]

........Looking at yachtworld, it's easy to find listed boats (same make/model, similarly equipped) where the price of the boat can vary by a factor of 3 to 4. If older boat A is $100,000 and newer boat B is 400,000, I have a hard time thinking that boat A will only require $10K per year and boat B will require $40K per year. .....

My thoughts exactly and why I believe the 10% of cost estimate is useless.

A brand new boat should have near zero repair costs while a 30 year old boat might cost as much as the purchase price in repairs over a year or two. Slip costs are the same for a $400K boat or a $40K boat.

Some owners are willing and able to do most maintenance and repair work themselves while others do no maintenance and repair work themselves and may even pay for cleaning. Slip and tax rates vary wildly from one area to another. My 31 day cruise cost me $1K in fuel. If I had gone faster, it might have cost $4K for the same trip.

 

[Andy G]

Coming in late on the discussion, however for what it's worth, we allocate about $22,000 per year to maintain the boat.That's about 13% of the purchase price.

This allows for the smaller unforeseen expenses such as antifoul, replacing pumps, repairing the loos,Eutectics TV antenna's etc. It also covers the annual engine servicing (2) and a generator(1), approx $2500.Also covered is the mooring fees of $10,000, insurance $1,800

What not included in the above are the large one off costs such as the rebuild of the port running gear, engine ,gear box & injectors at about $25,000. Replacing the main deck, which included new core and teak deck at about $15,000(we did all the labour ourselves)

AND if that doesn't scare you off the PO who owned the boat for just under two years spent over $100,000 bringing it up to scratch!

 

[sunchaser]

Andy G, nice to see some real world numbers. Five pages ago the OP was at $4500/year and now you are easily at 4 to 5 times that for a similar sized boat. For the unitiated, once again, this is a rewarding but not cheap pastime.

Today, if you buy a new vessel, figure about 25 -30% depreciation in the first two years and 35 - 45% after 5 years. That is what is coming out on my current boat search. So depreciation, if not yet figured into your yearly costs, is a very big number.

 

[baldpaul]

I posted earlier, but my annual numbers are $26,400 which I have going into a completely separate account. This represents about 5.5% of my purchase price. My boat is a 2005 with no known deferred maintenance as I try to keep things current. In two years I have spent every penny of that. However, I did a number of upgrades. Going forward for the next couple years, I am confident I can build up a war chest which I fully intend on having to spend in the future. There will come a time when I will have a $10,000 unknown expense and will be glad I have the money set aside in a "boat account". This is psychologically less damaging than having to come up with the funds from my general cash flow or investments. Kind of like a good Strata, start the contingency fund now.

 

[Moonstruck]

OK, Andy G and Sunchaser smoked me out. Here is the skinny on Moonstruck's budget.

• Annual slip rental with electric depending on where we are $7 to 9.000.00
• Insurance depending on where we are $4-7000.00 per year
• Haul outs, diver, and zincs $2,500.00
• Capt. to look after the boat in our absence $1,500.00

Fuel is not included here as we sometimes make some long legged runs of from 300 to 1,500 miles.

I figure our average budget for the boat at $22 to 25,000 per year.

Of course sometimes I will treat myself to some new equipment. Sometimes it is really not even necessary.

Now, why did you guys make me do this?

 

[Art]

OK, Andy G and Sunchaser smoked me out. Here is the skinny on Moonstruck's budget.

• Annual slip rental with electric depending on where we are $7 to 9.000.00
• Insurance depending on where we are $4-7000.00 per year
• Haul outs, diver, and zincs $2,500.00
• Capt. to look after the boat in our absence $1,500.00

Fuel is not included here as we sometimes make some long legged runs of from 300 to 1,500 miles.

I figure our average budget for the boat at $22 to 25,000 per year.

Of course sometimes I will treat myself to some new equipment. Sometimes it is really not even necessary.

Now, why did you guys make me do this?

Cause you actually like it!!!

 

[SomeSailor]

I'm noticing most do not include the payment for the boat itself in their annual cost although most are making them. Are we kidding ourselves a bit?

 

[Moonstruck]

I'm noticing most do not include the payment for the boat itself in their annual cost although most are making them. Are we kidding ourselves a bit?

The answer is probably yes. I go under the philosophy, like Marin, of not making payments on toys. This has worked for 40 years for me. The boat is not my main residence, so it is a toy. It is also a depreciating asset that can get upside down on a loan. If I were a live aboard, it may be a little different. However, yes if we considered all the costs. it would probably not seam worth it. So, I guess we just kid ourselves a little.

 

[ksanders]

I'm noticing most do not include the payment for the boat itself in their annual cost although most are making them. Are we kidding ourselves a bit?

Its funny but I mentioned that exact same thing earlier in this thread but had zero responses.

I know that most large boats are financed, at least from my discussions with marine title folks, boat brokers, other owners, etc... over the years.

It almost seems like a taboo subject for people online, and I don't know why.

Personally I do not feel bad about my boat mortgage. I'm not well to do enough to buy my boat outright without robbing the retirement funds. No problem there so I have a mortgage.

 

[MurrayM]

We had a small mortgage for a small house, and paid it off early. When we had enough money cobbled together, we went shopping for the boat. The banks make enough in profits that they don't really need help from me

 

[sunchaser]

Some Sailor

Following up with what Don said and going back to my post 100, depreciation/boat payments are a huge cost.

Assuming one pays $2M cash for a new 60' Nordhavn and sells it after 5 years at a depreciation loss of 35% or so for $1.3M. This is a depreciation "rough" loss of $140K per year. Figure in a 6% sales fee and it gets worse.

The OP's question is on a 10 year old Mainship (egads - without an AP so he takes 10% more fuel/time to get there) that is purchased for $160K cash. After 5 years he sells his vessel which is now depreciating at 4% per year or a "rough" loss of $6400 per year.

No matter how you look at it Some Sailor the cost to own for depreciation alone is big. If financed at X% it is even bigger. You can cut your loan interest in half if you and your banker can work out a line of credit which is LIBOR based.

 

[rwidman]

You can borrow money to buy something you don't need (a boat) or you can take money that would otherwise earn a profit when invested amd spend it on something you don't need (a boat). I am like a few others, I wouldn't finance something I don't need. Either way owning a boat is costing you $XXX per year.

At this point in my life, I don't care. I put in my time and saved my money. I am now rewarding myself with a boat and some other things. As long as the money going out doesn't exceed the money coming in, I am fine. I have a cushion for unexpected expenses.

 

[bfloyd4445]

first of all u are forgetting that in todays world unless you micro manage your investments you are making far less upoon them thaqn the current inflation rate. Plunk the money into a nice toy like a boat and or a 2nd, 3rd home and u have a tax deduction and tons of fun and recreation which does has real value in todays world. Extrapalate it out to include decreased health costs, possible tax deductions depending upon use, and then of course the estimated value of the relaxation and fun factor which I'm positive will cancel out all this negitiveisum regarding cash flow and boats.

bottom line is I'm sure your return for dollar will be greater than the current rate of .02 percent interest om bank savings accounts.

Me, i just wanna have fun

 

[Art]

We live 45 minutes north of central SF, on a small mountain's side, in a legally development protected county-style RE area, looking down over a really cool and locally renowned 18 hole golf course in the valley and its good sized clubhouse, restaurant, and bar. Town population 250. Other small towns surround our protected area and we can drive to visit Point Reyes or famous Sir Francis Drake Bay in minutes. Owe just enough on one of our rural based homes to work as tax deduction... NO other debt. Decent income with $$$ back up. For me: More inventions and processes to complete and sell - what fun! Love having a boat; our minimal ($8K+/-) annual cost for SF Bay Delta’s covered-docking, cruising, hooking, swimming, and playing (that's less expensive than any other form of full-tilt-boogey enjoyment - IMO) is our pleasing expense to have healthy R&R available - at any time we want, for as long as we want, with little to no planning required. Due to very reasonable purchase prices for an extremely good condition and simple to care for "classic" 1977 Tollycraft Tri Cabin having all extended-cruising/live-aboard features, and a cool tow behind Crestliner o/b runabout, that both have decades of future in their useable life spans, there is no appreciable $$$ down side to be seen. If playing poker... you could call our Tolly TC and Crestliner o/b runabout purchase costs, in regard to their future sales potential values, a virtual "PUSH"!

Fun for All... Yeah Baby!!

 

[SomeSailor]

No matter how you look at it Some Sailor the cost to own for depreciation alone is big. If financed at X% it is even bigger. You can cut your loan interest in half if you and your banker can work out a line of credit which is LIBOR based.

That's the reason I ask I suppose. I intentionally only bought the boat that I could pay for from the proceeds of my last boat and a draw from my savings. I don't have a boat payment, but I have much less boat than many others.

So, when I see my costs in the $20K-$25K a year range, and others with boats that cost multiples of 4-5 times what I paid for mine who claim to only spend $10K a year for their addiction, the numbers don't add up in my old nugget.

I think it's partially what Kevin mentioned. It's a near taboo to talk about "owing money on a boat", but my view of these beautiful boats says they must be some working stiffs out there that chose to borrow that cash to buy the toy, but just don't include it in their conversations.

Me... I could only justify the boat if I owned it outright, and that leaves me with an older gal that has good bones, but needs a lot more of my attention than others I slip with. As far as depreciation, I don't have to worry about that. I paid less for the boat than the running gear worth.

I still never look forward to paying that moorage bill though.

 

[bfloyd4445]

That's the reason I ask I suppose. I intentionally only bought the boat that I could pay for from the proceeds of my last boat and a draw from my savings. I don't have a boat payment, but I have much less boat than many others.

So, when I see my costs in the $20K-$25K a year range, and others with boats that cost multiples of 4-5 times what I paid for mine who claim to only spend $10K a year for their addiction, the numbers don't add up in my old nugget.

I think it's partially what Kevin mentioned. It's a near taboo to talk about "owing money on a boat", but my view of these beautiful boats says they must be some working stiffs out there that chose to borrow that cash to buy the toy, but just don't include it in their conversations.

Me... I could only justify the boat if I owned it outright, and that leaves me with an older gal that has good bones, but needs a lot more of my attention than others I slip with. As far as depreciation, I don't have to worry about that. I paid less for the boat than the running gear worth.

I still never look forward to paying that moorage bill though.

Yep. thats me. Toys are never financed but hate to pay the insurance and slip rental

 

[Pineapple Girl]

whether a person will have a boat mortgage and if so the size of the payments is something they need to figure out and factor in on their own--that's going to depend on the price they pay, the amount they put down, the interest rate they pay, the length of loan they choose... so it doesn't seem relavent to this dicussion for anyone to add in their boat payment when discussing what they spend on maintaining and mooring their boat. IMO.

 

[Art]

whether a person will have a boat mortgage and if so the size of the payments is something they need to figure out and factor in on their own--that's going to depend on the price they pay, the amount they put down, the interest rate they pay, the length of loan they choose... so it doesn't seem relavent to this dicussion for anyone to add in their boat payment when discussing what they spend on maintaining and mooring their boat. IMO.

Jennifer Pineapple Girl - Correcto Peal!

You statements are Right - On!!

One Sharp Cookie!

 

[Marin]

I'm noticing most do not include the payment for the boat itself in their annual cost although most are making them. Are we kidding ourselves a bit?

As it was explained to me by the GB dealer when we first started looking for a boat, and I have also read this in various places since, annual ownership costs are defined as everything it costs to own the boat each year--- fuel, moorage, insurance, upgrades, repairs, maintenance, etc.--- EXCEPT finance payments if you're making them. Finance payments do not seem to be considered part of the actual cost of owning and operating a boat.

I expect this is to enable people to compare apples to apples since someone who is financing x-make and model of boat will pay a lot more each year for his overall boating than someone who also has x-make and model of boat but paid cash so is only dealing with the actual costs of having the boat. So if a potential boat buyer asks, "How much will it cost me each year to own a GB36?" they can get a reasonably applicable answer. They can then add on their finance cost if they are going to finance the boat.

We paid cash for our GB so before we bought one we wanted to know how much it was going to cost us to own the boat itself each year, not own the boat plus pay for it.

 

[Pineapple Girl]

Thanks Art and exactly Marin! That's a great explanation of what I was trying to say.

Someone mentions keeping a separate boat account. We do something similar but it's all on paper (actually electronic file but whatever) with allocations to different large budget items like the boat. Works for us but of course personal finance is very, erm, personal and to each his own.

 

[Marin]

Like Jennifer and others, we have a "boat account" that we add to from time to time that is intended to pay for things like bottom paint haulouts and the other hired-out expenses that crop up. But like the US government and Social Security, we find the "boat account" is easy to rob if we have to replace a refrigerator in the house or fix a car or something.

 

[skipperdude]

Finance it or buy it outright. It all comes down to one thing.

Quality of life.

When I wake up in some sheltered cove with an Eagle up in the tuna tower and the sound of an Otter hammering a clam shell on a rock on it's chest. tap tap tap tap.

It is worth every cent I pay for my boat.

Even at the cost of a nicer house. Or a newer car.

To me life just wouldn't be worth living if I didn't have a boat.
You just gotta love it.

Sd

 

[Art]

Finance it or buy it outright. It all comes down to one thing.

Quality of life.

When I wake up in some sheltered cove with an Eagle up in the tuna tower and the sound of an Otter hammering a clam shell on a rock on it's chest. tap tap tap tap.

It is worth every cent I pay for my boat.

Even at the cost of a nicer house. Or a newer car.

To me life just wouldn't be worth living if I didn't have a boat.
You just gotta love it.

Sd

Sd -