Mid Size Power Boats

The Cost of Boating

Getting a handle on the cost of boating is not easy because it presupposes you know what the expenses are likely to be.

In most cases we know some, but mostly not. The obvious ones are the cost of the boat itself, the cost of finance, insurance, dockage, and fuel. Repairs and maintenance is where we have trouble.

When it comes to fuel, we almost always underestimate how much we’ll spend, so figure it this way: Estimate how many hours per year you will use the boat and divide that by two.

This approximates the actual amount of time the boat is burning fuel. Then multiply that number times the number of gallons per hour both engines burn at cruise speed.

If the engines burn a total of 34 gallons per hour, and you figure you’ll use the boat 100 hours per year, divided by two gives you 50 hours of burn time.

At 34 gph, that comes to 1700 gallons — enough to fill a small swimming pool. At $1.27/gal., that will cost you $2,159.00, not exactly pocket change.

Estimating the cost of insurance is easily accomplished by calling any marine insurance agent who can give you a general idea of what the premium would be.

The same applies for dockage, just make a few phone calls to marinas in your area.

Estimating other costs is a bit more difficult.

Estimating repair costs is not similar to cars, wherein new cars rarely ever have anything serious go wrong with them (at least in my experience).

When it comes to boats, that’s not true. Again, look in that owner’s manual package and note all the equipment that you expect to work perfectly for a long time and you’ll get an idea of why this is true.

Sure, the warranty will cover most things for the first year, but even then, you’ve got all those warranties to deal with.

The fact is that we don’t know if or when something is going to go wrong with anything. The product may work perfectly for a decade, or it could crap out the day after the warranty expires, we don’t know.

Therefore, the best way to get a handle on repair costs is to apply a composite average. We can do that by applying a percentage of the boat’s value, adjusted for age.

Based on experience, I recommend applying the following percentages on a per annum basis:

Boat Age Percentage*

1-2 years 2%

3-4 years 3%

5-7 years 6%

8-10 years 10%

* Warranty coverage not considered

The seventh to tenth year is estimated to be the most costly because this is the time period when major engine repairs are most often encountered, though in reality these costs are usually spread over a period of years.

That is to say, that as there are people who will only replace tires on their cars one-at-a-time as they wear out, so most boat owners will only make major repairs/replacements one at a time.

When one engine wears out and no longer will run properly, most often only one engine gets rebuilt, even though the other will not be far behind.

The reason for that is clear; many people simply can’t afford these major expenses and so try to cut corners.

Another expense that is difficult to estimate is the cost of fitting the boat out.

Fitting out means providing everything you need to use the boat the way you want to use it. This can include everything from galley utensils, to towels and linens, tools, cleaning supplies, hose and so on.

One can easily drop up to $2,000 into general necessities without getting extravagant. This is also included in my percentage for early years.

Beyond extra equipment which we include in the cost of the boat, we have everything from electronics to anchors, there are other needed items which you will probably be adding piecemeal.

These can include anything from a boat hook, to extra fire extinguisher, portable spotlight, fenders, extra lines and a list that is nearly inexhaustible.

If you think of furnishing a new home, you’ll find that buying a boat is not much different; the cost of buying a home is one thing, but the cost of making it the way you want it is something else again.

And though it is very hard to put a price on this additional spending, we can be sure that the cost is significant.

Moreover, as with a home, these purchases, alterations and additions usually go on year after year, so adding an additional 1-2% annually for discretionary spending items is not unreasonable.

Partnerships

Some people resort to various forms of partnership arrangements, from those merely between friends to those that are more or less business arrangements.

Few of these ever have happy endings since buying a boat is not unlike getting married. Boats are simply much too personal to subject to all the problems of joint ownership.

The usual complaint is that one partner is not carrying his load, or is abusing the boat and not treating it with adequate care.

Something very costly happens and the acrimony begins. Think long and hard before getting involved in one of these situations.

Charter Arrangements

Charter ventures have been around for a while, but I’ve never heard a good word about one that involves mid size boats.

Charter deals can and do work for much larger yachts, wherein the objective is to try to offset the huge ownership costs, plus such yachts have much better argument of on the legit business expense angle.

For the average guy that owns a forty footer, that raises eyebrows at IRS. The reason that such arrangements exist is primarily due to a tax angle, yet many actually have visions of profiting.

The reason that they don’t work well is that there usually isn’t enough income generated to cover the costs plus management fees. What they usually end up with is little income and an abused or at least badly worn boat with higher than average repair costs.

If such ideas have crossed your mind, I’d suggest you rethink, or at least talk with a few others who have had experience with such deals.