... [If] you purchase a vessel that is under state numbering:
If the state is a title state, the title for the vessel would show the lien from any financial organization.
If the state is a registration state, there is virtually no way to determine if any liens or mortgages exist for the vessel. ...

The benefit of U. S. Coast Guard documentation is the fact that the Coast Guard bill of sale bears a warranty statement that the seller sells the vessel free and clear of any encumbrances and should something ever come up against the vessel this is your legal recourse back to the seller.

Vessels are very odd pieces of property. The maritime law states that liens and mortgages do not have to recorded anywhere to be valid. ...
[Seems to be right; see David Brown's "Secret Liens"]

Our fee schedule for a transaction differs from boat to boat depending on many factors. A UCC search may not meet the needs of the transaction if for example the boat was currently Documented. A UCC search usually costs between $25 and $40 per name per search. If a person had more than one address it would be per address. If there is a fear of a Federal Tax lien then that issue should also be searched. ...

[I asked for clarification of the "A UCC search may not meet the needs ..." statement:]

Once a boat is federally documented it falls under federal law and as such null and void state filings. The reason lenders require documentation over state titling is that if they title the boat, then the borrower decides to document the boat on his own, the bank's state lien filing or title in essence becomes voided. Since there is no higher level of law the federal is always the safest for the lender. Also other nations recognize the federally registered (documented) boat since the national registries are a result of internationally conceived laws that most nations will honor.

I hope this offers you a flavor for the scope of the undertaking. It is difficult to cover all aspects of all types of transactions in a few words. ...

The first fee is for our office to handle the closing, or funds on the transaction. This $350 fee includes lien and ownership searches, preparation and filing of the buyer and seller documents necessary to transfer ownership at the state level, and our company's fees. To have a full UCC/Tax lien search it is $85 per individual. If you decide to purchase a documented vessel and choose to keep it documented there is an additional fee of $350. This includes the Coast Guard Filing fees, our company preparing the necessary documents, and transferring ownership with the U.S. Coast Guard. ...

The abstract of title for vessels ... shows all previous owners who documented the vessel with Coast Guard and any mortgages or encumbrances which may have been recorded against the vessel. It also shows when these mortgages were "satisfied". If the present owner has borrowed funds, this First Preferred Ship's Mortgage will show on the abstract. At that point, we would ask the seller to obtain a "Payoff Letter" from his bank showing the amount it would take to clear the title. Once the bank is paid, they would sign a Satisfaction of Mortgage which we would have recorded.

For almost all locations, it's not *where you buy* the boat, but *where you keep* the boat that determines the tax.

Buy a boat in St Thomas and tie it up in Ft Lauderdale, you pay 6% of the purchase price [to Florida]. Buy the boat in Ft Lauderdale and tie it up in Ft Lauderdale, you pay 6% of the purchase price. Buy the boat in Ft Lauderdale and keep it in St Thomas ... no tax!

...

As far as how long you can stay in one place without attracting the attention of the tax police, that will vary from location to location. Florida is 90 days. Maryland is 30 ...

... MD and VA, particularly, hire a lot of dock walkers who record boat names and hailing ports and then check again to see if they've been in the state over xxx months, which by law makes you a resident of that state, regardless of where you domicile, for the purposes of taxes (a lot of people from PA, WV, NC, DE, even NY keep their boats on the Chesapeake full time). OTOH, we were in MD for over 4 years and because we didn't use commercial marinas they'd never caught on to us before that. It's a toss of the dice. [But very expensive if you're caught.]

Florida is really bad, too. But if you keep your boat hailing port from somewhere else (like Texas, or one of the western states) and keep on the move, you can do pretty well at evading the tax man. The rub comes if you're in an accident, have a long hospitalization, a family emergency, or need extensive yard work and you settle in for a while and get spotted or turned in.

The very best strategy is to go ahead and pay a sales tax / use tax / excise tax somewhere. If you are nabbed, you've got something to wave saying you're not a scofflaw. And if you are fined or taxed or both, they usually reduce it by the amount of tax you'd already paid in another state (although if you paid more in tax than that state would have taken, they never seem to offer you a refund).

Taxes and Residence/Domicile - a primer

This primer is very general, but should give you an idea of what you need to be thinking about when you change your residence/domicile, or when you move about and _don't_ want to change your residence/domicile. ...

The examples I've used are based on personal experience. The legal stuff is based on my experience as a lawyer in the Navy JAGC for 30 years and having to deal with taxes and residence/domicile issues as they apply to an extremely mobile military and civilian population!

There has been so much discussion in the past week about taxes on boats, that I thought I'd put together a little summary of how the tax laws work. Related to the topic is the matter of "residence" and "domicile" so I'm throwing in some info about those topics as well.

Legal Residence

You'd best consult a tax adviser or an attorney who's familiar with thi area of the law, but here are a few general rules:

(1) EVERYONE has a legal residence somewhere. Residence is sometimes referred to as "domicile," and although there is a legal distinction between the two, it's not critical for this discussion. (I don't have my Black's Law dictionary with me as I'm writing this.)

(2) You can change your "domicile," but you can't change it to someplace where you do not currently reside. You must have an _intent_ to change your domicile, and you have to exhibit your intent to change when you are in the place you intend to make your "domicile" (if changing from your old one) if you want it to "stick" when push comes to shove with the local tax authorities. On the other hand, if you do *not* _intend_ to change your domicile (when living in a location other than the one you consider to be your domicile), you must avoid doing things which might be interpreted as an indication of your intent to change (for example, you should *never* vote in a state election in a location you do not consider your domicile. (Most big-money legal issues surrounding residence and domicile arise after you're referred to as a "decedent," so by then it's too late to do much to convince the authorities one way or the other!) Examples of not intending to change your residence even after a prolonged stay in one location would be where a person is hospitalized and unable to be moved, or where your boat is subject to some catastrophe that disables it to the point of requiring long-term repairs and you don't have any other form of transportation - both of those situations would result in an _involuntary_ stay in the location, and in the absence of other manifestations of an intent, would not establish a new residency.

(3) Residence has different meanings for different things. For example, states impose their own rules of "residence" for tax purposes - you may have to pay income tax in the state where you reside for a minimum period of time and earn a certain amount of income, even though that state is not your "domicile." States also have residency requirements for voting in _state_ elections.

(4) Various tangible things are evidence of an intent to establish a "domicile." Driver's license, bank accounts, ownership of a home, registering to vote (in a state election - you can vote for President/VP anyplace), titling a vehicle, etc. These things establish your "domicile." They also establish your "residence," but as indicated above, "residence" means different things for different purposes.

Unless you do something affirmative to change your "domicile" it will remain the state where you currently live, even though you might be cruising the ICW, etc. You can keep your driver's license there, vote (perhaps absentee), pay taxes, etc. You can also change your domicile by living in Florida, for example because it has no income tax, and registering to vote, opening bank accounts, paying local taxes, voting, etc - all of which are simply manifestations of your intent to change your domicile.

It's complicated, and at the same time rather simple. You could easily end up with several states claiming that you are a resident there for tax purposes, and more importantly, state inheritance tax purposes!!! It's not something that should be undertaken on a whim - there are far too many ramifications.

If you have a personal situation that requires an answer and big $$$ are at stake, you'd best consult with your attorney or tax advisor who's familiar with this area of the law. Events can be interpreted differently and the legal rules could be different in your state. In the long run, you'll be dealing with the state tax authorities and (the Gods forbid) the legal system!

Taxes

This is a very general discussion of taxes and their consequences for the boat owner, so if you have a real situation, you'd best consult with your accountant or a tax attorney.

States generally impose four kinds of taxes: income, sales, use, and property. There are a few others, such as business taxes, that aren't really germaine to this discussion.

(1) Income tax is imposed on income earned within the state, or by a person who "resides" in the state, wherever earned. (See previous discussion re legal residence.)

(2) Sales tax is imposed on the sale of an item within the state. Generally, the rate is the same no matter what the item within the state, but states may choose to exempt certain items from the imposition of the sales tax, such as food. Other specific types of items may have a specific sales tax imposed, such as the sale of real estate, that is at a different rate from the general sales tax.

(3) Use tax is a tax imposed on items BROUGHT INTO THE STATE upon which no sales or use tax has been paid in any other state. Generally, the rate is the same as the rate of the sales tax.

(4) Property tax is generally an annual tax imposed at a set rate for different categories of items LOCATED WITHIN THE STATE. For example, the property tax on commercial real estate may be different than the property tax on residential real estate; the property tax on cars different than that on trucks; the property tax on boats different than that on cars, etc. Some states exempt certain items, such as boats owned for recreational purposes; others impose a property tax on all boats.

Now that the generalities and definitions have been dispensed with, the real question is - Where are you THINKING of locating? If you have options, you might be able to take advantage of the fact that some states do not have an annual property tax on boats. Other than that, with very few exceptions, you'll have to pay either a sales tax in the state where you buy the boat, or a use tax in the state where you eventually house/keep the boat. While some states don't have a sales tax on certain items (groceries, for instance), they may impose a sales tax on big ticket items like cars and boats. A use tax is sort of a complement to the sales tax. You pay one or the other, but not both, and the tax rate is generally the same for both.

Property tax is a different matter. Some states have it, others don't. Some tax boats, others exempt boats (Maryland, for instance). As an example, I live in Virginia and keep my boat in Maryland. I bought her in Massachusetts. She's documented with the Coast Guard, and I renewed the documentation in my name when I bought her. I did not pay a sales tax in Massachusetts because I knew I wasn't going to keep the boat there and didn't know where I'd eventually end up. I had the option of keeping the boat in Virginia, Maryland, or the District of Columbia, all of which would have about the same convenience factor. Once I chose to keep the boat in Maryland (for cruising considerations), I had to obtain a Maryland "USE" decal by paying the use tax. Maryland does not have a property tax, so I won't have to pay any other taxes there. Had I chosen DC, I would have not had to pay either a sales, use or property tax. Had I chosen Virginia, I would have had to pay the one-time use tax, plus an annual property tax. Coast Guard documentation does not eliminate the need to pay taxes, although some states MAY exempt documented boats - depends entirely on how the legislature decides to handle the matter.

Once the sales or use tax is paid in any state, KEEP THE RECEIPT. No other state SHOULD require you to pay their use tax once you show proof that you've already paid an amount at least equal to or greater than the tax which that state would impose - you'll normally be credited with the tax (sales or use) paid in another state. If you paid less than that state would impose, you may have to pay the difference; if you paid more, normally no tax would be due.

If you are a transient (not staying permanently in any location), you may be able to "get by" without paying the property tax if one is imposed on boats - but you'll need to keep moving. Most states have a time limit on how long the boat can be in the state without paying the sales/use and property taxes. In Maryland, as an example, it is 30 days (sales/use tax only). States with any sort of transient boater traffic patrol their waterways and marinas to try to catch boats who are not in compliance with their local tax laws.

In short, once you decide what your options are, check with the tax authorities, your attorney or tax adviser. Some states have information about their tax structure available through the internet!

I wouldn't advocate lying or "coming up with a good cover story" in any event in order to avoid the taxes. The burden is on the taxpayer to show that the tax isn't owed, once the state establishes a likelihood that it should be paid. There are penalties for non-payment, and interest that accrues at a steep monthly rate!

If you have a personal situation that requires an answer and big $$$ are at stake, you'd best consult with your attorney or tax advisor.

Budget a hundred grand will get you into a [40-foot or so] boat, and give you options. Figure the first's year expenses to be closer to twenty and the second probably the same even if you attempt to control the bloodbath.

Also figure that it is going to take eighteen months to thirty months to go from purchase to ready-to-cruise. This does not mean you won't be sailing, but if you're smart you won't be sailing far.

There are several categories of vessels for sale. One major category are the boats that have passed from current usage to "for sale" and have sat for a while, sometimes years without use, with minimum maintenance. These boats can survey well. I can guarantee with this category of vessel that systems failures are just around the corner and will be beyond what one would expect.

Cruising is like exercise: you may think that you are using all the muscles you need to play tennis but till you actually play tennis you will never know. And invariably when you do finally play you will hurt in places that you didn't even know that you had. Same with the boat.

Personal experience: I once met a couple who were friends and neighbors of one of my students. They had purchased a vessel, nearly fifty feet, some three years earlier. And over the past three years they spent almost every Friday night, Saturday and Sunday working on the boat. They lived about four hours away and drove to the boat each weekend, and many times during the week, to stay on board and fix up their dream machine. They had not sailed much, but they were now at that point and asked me to help. So I agreed, gave them a reading list. Unfortunately, it took four attempts and six grand to successfully make the trip from their slip to the ocean, about three miles. Now this is a boat that had continuous, enthusiastic maintenance for three years. In that first month of our relationship they replaced or repaired: one head, the fresh water system, a transmission, the fuel system, a starter, an injector pump, one winch, and about twenty little items that were not big enough to mention. They were daunted, and expressed their amazement.

The truth ... this is so common that it could be called normal.

Another student in my inventory of stories, full of enthusiasm purchased a vessel, one that had sat for a number of years without use, the boat was in excellent visual condition. This student spent thousands of dollars of his limited budget upgrading systems and putting on the newest toys. At the time, I attempted, to the point of being a nuisance, to dissuade him from spending so much of his commissioning budget so early in the game. He listened to a minor degree and was glad he did. The first six months he suffered some rather large expenses.

This is a common occurrence, spending too much in the beginning.

Another type of common vessel for sale is the "current" cruiser. This a boat that has been actively used and maintained. Unfortunately this vessel type has its own unique elements. Either the boat is loved and cared for in a professional manner and the purchase price reflects this, the boat does not sell, and then the vessel moves into the category of boats which we already spoke of.

Or the owner knows that any excess expenditure is a waste of good money that he will not be able to recoup in the vessel's sale. So, there are a hundred weak points that he knows of and does not share this information.

Perfect scenario:

1. Find a good boat.



2. Survey it to death. This is the ONLY TIME in your entire boating life that you will be in the driver's seat. This is an opportunity to make the best deal possible. You may not be able to control the price you sell the boat for, or the expenses you will incur, but you can control what you pay for a vessel up front.



3. Go to the yard with a list of immediate problems and tasks. Stay focused and get out of the yard as quickly as possible. This is important; it is so easy for the boatyard to turn into a bloodbath of expenses. Just one more thing, one more thing, one more thing. My suggestion is to work from a detailed list of items. You will have a number of repairs that you will want to take care of after a good survey.
   
   I would like to expand on surveying a vessel. Like I said it is your only time to be in control. You need to be able to work from a list. To this list you will add a number of items that should be done to any new purchase. Change all the engine and transmission fluids, change all the engine hoses, change all the belts, service all the thru hulls, check every single hose for condition and change if at all suspicious.
   
   Changing hose is more time-consuming than expensive but this will be the only time you have the enthusiasm and probably will be the only time you will ever do this. Most sailors move on to another vessel before they ever get to do this task a second time. Which means that when you do this it will be the first time since the boat was purchased by the previous owner, if then.
   
   Vessels now-a-days have ball valves instead of proper seacocks, which last forever and can be serviced. Ball valves cost about a tenth and last only a few years before dying.



4. Go sailing ... after the bloodbath of yard time you will need to go have some fun so that you can remember why you have volunteered for such abuse.



5. You will need to haul again in a year and you will have a list as long as your arm. This second haul out is most important. The first time around you were operating from a position of ignorance, you had no personal knowledge of the vessel. After the first year to eighteen months you are beginning to know your vessel. Her personality, what she likes and what she does not. Her weaknesses and her strengths, what you can adapt to and what has to be changed.



6. During that first year of sailing, stay close to facilities, you will need to be able to get parts and professionals. Being in Belize with an engine that refuses to run, borders on horrendous. Who needs the stress ?



7. At the eighteen to twenty-four month mark you should be in good shape. You have survived screwups, fixed about every thing at least once. Know where your weak spots are. Thrown away some of the whiz-bang, can't live without purchases. Realized why the previous owner did some modification that you have spent money FIXING and now are spending more money putting back the way you found it.

Rosy picture? Not quite. Doable? Yes. Worth it? YES.

... I characterize refit as an over-ripe onion. Peel a layer, then cry. Peel another layer and cry again. Eventually you get down to the good stuff. Every project seems to spawn new projects.

...

If you're using contractors to any great degree, count on your expected expenses in a major refit to be not less than triple your (and their - likely it will require a much higher multiple for yours) worst guess, unless they're willing to make firm job quotes vs time and materials - but very few will, other than for cut-and-dried, simple projects (bottom paint on a prepped bottom, e.g.).

Don Casey, the good old boat writer, says the way he figures time on projects he does himself is this: Break each project down into the smallest envisionable tasks. Assign what you think to be a *worst-case* length of time to accomplish each. Add them up. Then apply the fudge factor. His is 3. He says, for him, that usually works out pretty close.

That's for a guy who makes a living writing about keeping up old boats, and does lots of it along the way. So, unlike us, he doesn't have to learn each job (we don't know how to do this well, since we don't do it all the time) and, just when we get the hang of it, move to the next one. Yet, his jobs usually take three times the worst he can figure. For us, it's probably more like a 5 to 10 fudge factor. For contractors, if it's a T&M *estimate*, I think the Casey fudge would probably be reasonable. That is, whatever a contractor thinks it will take, multiply by 3. ...

I still have on the mast a list of stuff which, when Lydia was here last year, in May, and I went home for a couple of weeks, my contractor said would be finished when I got back. Not one of them was finished, when I returned. And, today, 11 months later, there are still several items left on the second list which he said would be finished in June (another month).

...

... if you're not at the job site at least very regularly, nothing happens. ... if you're going to use contractors, plan on visiting the site daily, if not more frequently ...

...

... if you're talking about equipping (vs refitting), you can probably come pretty close in cost estimates.

...

... if we let it, the boat would continue to generate projects, and it would never leave.

Ok, two years ago Feb I bought the boat. I made a list of 16 things that had to be done before we left to see the world in 6 months. The cost would be $15,000 and we would be on our way by July 1997.

Then I didn't retire but stayed on two more years. The list grew to a max, at one time, of 120 things to do. And the cost was approaching "over run".

Now I am planning on a January 2000 departure (after hurricane season). I finally retired in January 1999 and began serious work on the boat. The cost so far is up to $13,000 which is not too bad from my original estimate. The list is now down/up to 48 things to do from my original 16 things to do.

I ran a complete audit of the things-to-do list yesterday and the 48 items will require $6,000 and 112 hours of time. If I divide 112 by 8 I find that working 8 hours a day I can be done in three weeks, yeah, sure. Since I have 7 months left it looks like that will be just about enough time ... #8-)

The total cost will come in under $20,000 so I don't feel too bad. Only a 33% overrun is much better than the government does on most of its work.

Much of the remaining work is little stuff such as purchasing an item to be carried so the time involved is not that bad. Many of the things are convenience items or cosmetics so are not so critical.

The two big costs not yet met are the survey and refurb of the standing and running rigging and the purchase of a liferaft. (The life raft I have now is 20 years old and was last inspected 8 years ago. I expect when we open it we will find garbage.) These two items will run about $3,500. The remaining $2,500 will go for a water maker and a hot water heater and some incidentals.

I am hoping to find a used watermaker and a used liferaft but have budgeted for new equipment.

But not included in my $6,000 budget are a few things that are unknowns as yet, such as possibly a new sail or two and maybe replacing the current head.

I figure when I get the list down to about the original 16 items I will be about ready to go and will finish on the run.

Cheers

[In 1996,] We spent 95K for our '86 Wauquiez Hood 38 and then immediately spent an additional 30K on equipment.

The boat I bought [13 years ago] was a seven year old Cabo Rico 38 in quite a state of misuse as it had sat at the brokerage for over two years. The teak was gray, the gelcoat thick with grunge, the canvas faded. It had gone on the market for $98k, and I bought it for $69k. Today [2000], Cabo Rico's of this size and age sell on the East Coast for $125k. I also bought it the last year that sales taxes were deductible.

That said here's a list of things I've done:
The biggest was painting the mast, boom, and staysail boom, installing conduit on the mast interior for wiring, replacing the rigging, installing a RADAR mount and new tri color light, new halyard attachment, new safety lines for the deck and misc. stuff for $12k plus.
Next came the gelcoat job on the hull for blisters and replacing the foam interior in the rudder for about $10k.
Having someone else do a full seven coat varnish job can be had for just under $5k so I only did this one once.
Gel batteries, monitor, inverter, alternator, and regulator installed is close to $5k
Electric windless installed, chain, upgrade anchors $4k
Below deck autopilot installed $4k
Monitor windvane installed $4k
Liferaft $4k
Dinghy, outboard, hoist for motor, swimsteps between $3 and $4k
Then you get into the new 125% jib, new main, asym. spinnaker, GPS, SSB, EPIRB, roller furling. There's about $10k

Or converting from CNG to propane (new stove and heater, tanks etc).
Dodger and sail covers? did that.
Transmission and starter? replaced
Refrig., head, water heater - replaced
Currently replacing cushions $3k

So - I got a good deal on a basic boat, lived aboard for 13 years and have it ready to retire/cruise this fall.

The dream continues.

Refit costs - wow. I added up the refit costs from the last 2 years since I bought Hope, a 1966 Lecomte Northeast 38. She came with a Yanmar motor, good main sail, Newmar electric panel, and good top side and bottom paint. The total cost for everything (including sandpaper) from thru hulls to standing rigging is $22,000 so far plus my labor. I've done all the work including engine R/B myself. I estimate another $7000 for autopilot, windlass, chain, and little stuff this winter. I still want a water maker and ssb but not until I'm ready to leave on the "big cruise".

... what we have spent in the last 2 years upgrading our boat [1979 CSY 44, bought 2 years ago for less than $100k]. Some things are essentials that were noted on the original survey (such as replacing the cutless bearing) and some are luxuries - I have not attempted to segregate out the luxuries, and the numbers are rough round numbers. Things are listed in order of price, and not in order of purchase or importance.

Max prop (feathering prop) $3600
Autopilot $1700
SSB $1600
2 LectraSans $1400
RADAR (Si-Tex) $1000
Dinghy davits from Kato $1000
2 solar panels ($500 @) $1000
New bimini top $800
Wind generator $800
EPIRB $800
Used non-electric windlass $795
Inverter (sine wave) $700
Upholstery fabric $700 +-
Mast steps, ascenders, etc $680
10 PFDs and rebuilt kits $680
Charts/electronic charts $610 +-
Para-tech anchor $600
Tank tender $600
Sewing machine for sails etc. $600
Replacements for motor mounts $600
1/2 barrel chain rode @290 ft $500
RADAR arch $500
ICOM VHF with hailer etc. $480
Computer nav program $480
SuperMax anchor $450
Portabote - 2nd hand $450
2 GPS $439
Spare starter $390
Wire and hose for Lectra Sans $350
Dripless packing $300
2 binoculars $229
Link 20 $200
2 marine toilets $200
New shaft (original scored) $200
13" color TV-VCR - dual power $200
Spare engine cooling pump $150
2 alternators $130
Cushion for helm seat $125
Battery cable and crimping tool $120
2 strainers $120
2 Fenders $100
Wood for projects $100 +-
Cutlass bearing $90
Stainless plate/stern rail Danforth $80
4 dock lines $80
Exhaust elbow $70
2nd hand VHF (handheld) $65
High level alarm $50
Spare exhaust elbow $40
2 bilge pumps and grey water box $40
2 bearings for roller furler $30

Does not count numerous stainless fasteners, or stuff we already had like a pressure cooker, a climbing harness and 4 batteries, or stuff we got out of the city house when we sold it like a microwave, stereo and CD changer. Bottom paint, repainting the trim, purchase of new name graphics, and books bought for each other as gifts amounts are also not specified.

Adds up to about $25,000; a little over 25% of the purchase price.

We have sold our home; we have sold all our cars. Now, how do we get liability insurance while we drive rental cars? In the past, our homeowners liability umbrella and our auto insurance liability covered us in rental cars.

We can buy insurance from the car rental company. The problem is that it is expensive and limited. For example, insurance on the Ford E250 Cargo van we are currently driving, and will drive to California in mid-July, is $24/day and provides only $50,000 liability. We also have a mid-size Hyundai car rented. That insurance would cost us $77 per week with the same liability limit (the car rents for $140/week).

It has been suggested that we keep our old dead Saab in storage and continue to insure it. That way we would have coverage on the rental cars when we drive them. That option would cost us over $700 per year for insurance and licenses and $500 per year for storage costs.

My insurance broker and two others I have called have said that there is no "broadform" liability available for rental cars if you don't own a car.

How do you other cruisers who don't own cars but do rent cars provide liability insurance for yourselves while in the USA ? (I know my USA coverage does not insure me in Mexico, the Caribbean, etc.)

It has also been pointed out that if we cruise for five years without auto insurance and then try to buy auto insurance we will be assigned to a high risk pool for at least a year, even though we have spotless driving records and no claims since 1991.

Has anyone tried to get auto insurance in the USA after cruising for years without it?

[more ...]

I am only concerned about auto rentals in the USA since very few USA insurance carriers provide coverage outside the USA. When I had a real job I averaged over 100 days of car rentals a year for 15 years. I rented in Africa, Europe, Australia and North America. Since I owned my own business I purchased special auto insurance that would cover me worldwide in any car. That extra insurance only cost me $198 per year but it was tied to my business auto insurance. State Farm will not sell me such a policy if I don't own a car.

I have MasterCharge, Visa and AmEx Platinum and have always used them for car rentals all over the world. I talked to all three companies yesterday and today. They all provide SECONDARY insurance that picks up the deductible and other amounts NOT provided by your primary insurance company. If you rent a car thru either AmEx or Visa or MasterCharge and carry NO primary insurance they will provide comp/collison and a very small amount of liability (less than $50,000 which is totally inadequate). I spent several hours on the phone with them - they are adamant that they provide secondary coverage.

It is not possible to purchase an umbrella liability policy (also known as "broadform" liability coverage) unless you already insure either an automobile or a house. The umbrella policy is tied to the primary homeowners or auto owners policy. An umbrella or broadform is what we want, we have always carried an umbrella on both the car and the house insurance. As I said, I have talked to five brokers or agents while trying to buy an umbrella - I can't find a way to do it!

We have had State Farm for 20 years - they will not provide any insurance if we don't own a home or an auto. I have talked to two larger insurance brokers, to Royal and Sun Assurance, and to Blue Water Insurance. They have all told me the same thing - if you don't have a land based asset that is insured you can't purchase any liability insurance.

The policies that Blue Water brokers only provide liablility coverage for damage the boat causes. If I cause the damage when away from the boat - that is not insured.

Yes, I can purchase insurance each time I rent a car - at a minimum of $10 per day and it provides very little liability insurance.

1. Umbrella policies are designed primarily as excess policies. That is, they pick the next million or more after the primary policy is exhausted. If there is no primary policy you are personally exposed for the first $300,000 or more of any judgement.

2. Credit cards typically cover only damage to the rental auto.

3. Keeping a clunker with coverage on it is an option, BUT your policy will only cover the rental car up to the value, and for the coverages maintained on the clunker.

4. Are there solutions? Not good ones, but:

a. We sell Zurich's liveaboard policy which covers your personal liability as well as the yacht liability. No problem, but expensive.

b. Buy the rental car company's coverage. No problem, but expensive.

From my experience with a Wilderness 40 (Gary Mull, Santa Cruz built, 72-81 PHRF), I would guess you should budget at least $10,000 and probably closer to $20,000 per year for the boat (repairs, systems upgrades, cosmetics, insurance).

Stuff wears out, gets old, gets damaged in use, or needs to be replaced. Sails last 3 years if you really sail, and would cost about $5,000 for a dacron main and a 110% on a furler. Chutes are another $2,200 every 4 years. Rod lasts about 7 years and a rod and turnbuckle rerig is another $5,000. When you replace the rod, you will probably replace or upgrade the furler $2,000. Rebuilding the watermaker is $500 or so every couple years. LP for the decks is probably $6,000, for the hull $4,000, and for the mast $1,500. Heads die, pumps die, autopilots die. Halyards die. You want to upgrade to line adjust lead cars. The cabin sole needs varnish. The interior needs varnish. You want new foam in your bed, and new covers in the salon. The heat exchanger needs to be replaced. The exhaust elbow needs to be replaced. The raw water pump needs to be replaced. All the belts and hoses on the engine and the coolant pump all ought to be replaced. The stainless steel gallery sink pits through from the salt water being used in it and needs to be replaced. You want a new stove. The TV, never designed to be used on a boat, dies. Batteries last say 500 to 1,000 cycles, 3 to 5 years. Rafts cost $300-$500 per year. EPIRB batteries are $300 or so. You need a new awning. The cabin ports need to be replaced. The winches need to be serviced and reanodized. The keel leaks: it needs to be lowered, the bolts inspected, and then rebedded. The anchor windlass self-destructs. You need new Lexan in your deck hatches. You want to upgrade from a folding Martec to a geared folder or a feathering prop. A diver is say $30 per month; a bottom job is at least $1,000. You need to repair water damage to your deck core. The depth sounder stops sounding. The bracket holding the fridge compressor breaks. You are tied up at the end of a dock and the low voltage sensor on your air conditioner does not shut it down fast enough and you need a new compressor. Your fuel tanks are 15 years old and are starting to leak thru pits in the stainless and need to be replaced. I cannot remember whether the J40 uses hydraulics or blocks for the backstay, the vang, the outhaul. Either way, they all go. Etc., etc., etc.

Then there are the inevitable "accidents." Your new LP hull gets massive scrapes from a bumboat. You round down and put the spin pole in the water and need a new tube. ("Let's get a lighter one, like that black one on Steve's boat.") Your dinghy gets trashed at the town dock because someone sandwiches it between the rock wall of the dock and a 20' panga while you are ashore for dinner. Your bimini is blown down in a 60 knot squall, and the same squall mangles your bow roller when the snubber breaks and the chain pulls tight. Some kids are fishing off the dock, and they catch your dinghy, puncturing one chamber and sinking the motor. You are boarded for an "inspection" and the boarders mess up your lifelines and stanchions, oh and by the way, one of them grabbed your SSB whip to keep from falling ("Sir, we are almost done, and if you will just sign this release, you may go on your way ...").

Whatever you do not do as you go along either has to be done when you finish or just lowers the value of the yacht when you sell it.

A guy I know, the chief carpenter on a 100' plus motoryacht, budgets 20% of the new value of the yacht for maintenance each year to keep it "new" (and it stays new). The longer I am at this, the less I think he overstates the real costs. I get similar estimates from the professional captains of sailing yachts (e.g., $60,000 per year to keep up a Deerfoot 2-62, used value about $500,000, and not to such a high cosmetic standard).

Yes, they pay people anywhere from $2 to $15 cash per hour to clean, paint, varnish, sand, and scrub, and they pay the yards and marine specialists to do things. Some of this you may be able to do yourself, but a lot of this you probably cannot, and ought to hire an expert to do so as to not diminish the value of your yacht. (Whatever thoughts I had about LP, I watched a very good painter try 4 times to get a perfect dark blue Awlgrip finish on a Farr 40.)

Your maintenance estimates are too high. If I have to spend 10% of my boats value ($10,000) a year, I will shoot myself. My plan is about $2,000 a year to cover a bottom job every two years and whatever breaks. There might be some surprises but I don't think so. The big cost was getting the boat ready in the first place. I bought it for $52,500 and will have an additional $20,000 in it on upgrades and repairs before I leave. This has been a 3-year project.

I've always thought the "10-15% of boat value for maintenance" was a ridiculous figure. It in no way accounts for an economy of scale. Let's say a 42-48' trawler costs $400K (actually they cost about twice that these days). You would have to perform a major overhaul on both engines every single year to account for the $40K; replacing all the electronics might run you $40K but not every year. You might claim that something costing $40K comes up every year but you'd have to have astoundingly bad luck to string along a series of years like that. I think this 10% figure is probably more accurate for boats that cost under $50K. Sure, larger boats do cost more to maintain, larger bottoms to scrape and paint, larger decks to cover and so on but I think that the actual dollar amounts don't increase at a clean 10% of cost.

The enemy of sails is two-fold: the wind and the real culprit, UV rays.

A full suit of sails for a 40 ft, blue water boat could easily approach $10K-$15K.

If you sail in relatively high latitudes, life of those sails could easily exceed 10 years.

OTOH, sail at low latitudes, say 1,500 hours/year, and those same sails may be rags in 3-5 years.

Assume a worst case of $15K cost and 3 year life and you have a sail cost of $5K/year.

($5K/year)/(1,500 Hours/year) = $3.34/hour of sailing.

BTW, 1,500 hours is a lot of sailing time in one year IMHO.

If you assume 6.68 miles/hour as an average speed, then ($3.34/Hour)/(6.68 Miles/hour) = $0.50/mile.

Sail from San Francisco Bay to Cabo, say about 1,400-1,500 miles, you will have depreciated your sails about $750.

The numbers are quite variable; however, they serve to illustrate the point.

From the day something is created, it starts the inevitable march to the junkyard, and that includes us.

$10K-$15K ??? Absolutely custom made new sails? Maybe.

I can buy a slightly used but serviceable mainsail for my Coronado 35 for under $1000 any time I want. I've been quoted the price by 3 different used sail sources.

I am never going to buy a new sail to depreciate it'd first 59% in the first year anymore than I bought a new sailboat.

So let us recompute the costs.

Let's say I spend a whole $2500 (main and jib only - I ain't flying no spinnakers :-) )

Let's say they last 2 years (I think you are all wet here, too many letters from too many people out there in the tropics. The main cause of sail loss is damage from too much cloth in too much wind.)

So I amortize $1250 over the 1500 hours (never gonna happen - I'm WAY too lazy to sail that much!) at a more realistic 4 knots. I think I got about $0.21 per mile? Maybe my math is bad, or is it really that much cheaper than fuel?

And, as I said, most letters I read from people cruising from Mexico to the South Pacific describe blown-out spinnakers, not mains, usually caused (by their own admission) by carrying the spinner when they should not be doing so (overnight in deteriorating weather).

I'm still using the original sails that came with my boat, a Whitby 42 built in '77. I have had a few repairs made, but the cost of repairs is "in the noise".

I'm about to replace these sails and the price of three sails (main, mizzen and jib) is $3259. Amortize that over 26 years and sail cost is insignificant.

> How much does a non-business mailbox cost ?
Small $10/mo; medium $14/mo; large $19/mo. ALL have a 3-month minimum and a $5 non-refundable key charge.

> What will the mailing address look like ?
Street address with # ---

> Will DMV accept such an address for getting a driver's license and car registration ?
Yes, because it's a street address - also good for accepting UPS and Fed-Ex packages during the day.

... three years later, I've paid more in storage fees than the price of buying all new belongings. I've also forgotten what's in storage. That's how much I miss the stuff.

Down most of the Atlantic coast, transient rates for dockage (per night) vary from $0.75 per foot to $3 per foot, depending upon location, and to a lesser extent, services. Weekly rates are about 75-85% of what you would pay on a per- night basis, and monthly rates are often a great bargain, commonly in the $5 to $20 per foot per month range.

Annual rates, including in-water storage during summer, and on-the-hard in winter seem to be from $900 per year to $5000 per year.

Mooring (as opposed to dockage) is ususally even cheaper, often $15 per night for transient. Unfortunately, I am not thrilled at the idea of leaving my boat unattended at a mooring, so I usually don't look for a mooring if I have to leave the boat for a while. Also moorings available to transients are much more rare than slips.

Anchoring is free, and the most fun. I try to be at the dock if I have to leave the boat unattended, for working on the boat, or in very bad weather.

...

It pays to shop around. I have almost always been able to find slips and moorings at the low end of the ranges described, cos I'm naturally cheap. Skipper Bob puts out some excellent publications describing costs of boating along the Atlantic coast. Get one at any good marine bookstore. I have used them with great success for frugal cruisin.

...

> What is the average charge, per day/week/month/annual, for a mooring?

We have used a transient mooring several times and it was $15/day.

A notable moorage was at the 79th Street marina where for $15/day NYC was our playground.

> When you are anchored or using a mooring buoy, I realize there is often a
> dinghy docking fee at a marina. Is free docking ever available?

We have cruised from Key West to Maine. Key West dinghy dock was $2.50/day, $15/week, $45/month. St Augustine was $7/day, $120/month. Norfolk Waterside at ICW mile zero was $2 day the first year, free the second year, and $2 the third year - guess it depended on who was on watch. Everywhere else was free and varied between town docks, resturants/bars, and Annapolis, where by local law every street that ends at the water is a free dinghy dock. We love Annapolis.

I presume that if you pay for a mooring that includes dinghy dock.

> When paying a mooring or dinghy docking fee, does this fee include use of
> marina shower/laundry/etc services?

Key West and St. Augustine had head/shower/laundry included.

The city of Key West has recently began a mooring area for about 150 boats. The cost will be $150 per month the first year, $250 in year 2 and $325 in year 3. After that the price will rise based on the CPI. Transients will be charged $12 per day. For this price you get the mooring, dinghy dockage and 3 pump outs per month. Though this sounds good on its face, the down side is there will be no more liveaboard or anchorage in the sea plane basin which is now home to lots of boats and liveaboards for FREE!

I just spent a week doing a marina tour on the Florida gulf coast. I visited marinas from Bradenton to Naples. The average price was $10/ft +/- electric plus $100 - 250 for liveaboards / month for a 40' sailboat. Most of these included such amenities as laundry, showers, pool and sauna or jacuzzi, some even had workout facilities. Every marina I visited allowed liveaboards, although not all of them had slips for a 40' boat.

I would say you are being too conservative in your numbers. ...

1) Why keep a car while you are gone? You won't need it till you get back and it would be better to get a newer one by then. I will be keeping 7 cars so I'm not one to talk, but I have the place and the resources to keep them.

2) Your food will cost less than you think. I plan on less than $300 a month for two people.

...

4) Your maintenance estimates are too high. If I have to spend 10% of my boats value ($10,000) a year I will shoot myself. My plan is about $2000 a year to cover a bottom job every two years and whatever breaks. There might be some surprises but I don't think so. The big cost was getting the boat ready in the first place. I bought it for $52,500 and will have an additional $20,000 in it on upgrades and repairs before I leave. This has been a 3-year project.

5) If you wait till you have a million you will never go.

6) I will be maintaining the boat, my house, my cars, and all my "Stuff" on a budget of $3000 a month and plan on having $1500 surplus every month. So, practically, you could do it on $1500 a month (the guy I bought the boat from did it on $400 a month for 8 years) which at 6% means you need only $300,000 and you need less when you consider that you can use some of the principal if you want to figure how long till you die. But even more importantly, after age 62 you will get a bump in income from SS and a cut in costs from Medicare.

...

BTW, one thing I would do. Don't buy anything till you absolutely have to have it unless it's a used bargain. Much of my stuff I waited on and then found it cheap from someone who was quitting ... ICOM 725, new in box, $450 ... 3KW Isolation transformer, used, $100 ... Davits, used, free ... Water maker, used, $1500 ... 45 lb Bruce anchor $95 ... etc. If I had bought all that stuff new I would have paid more than $6000 and instead I paid $2415. It's worth waiting.

Also, don't do as I have done and build up a big pile of stuff in the garage that on the last day I will be just throwing aboard and will never find it.

I have been a Liveaboard on and off for twenty years. I currently have a boat on the Chesapeake where sailboats for sale are more than plentiful. If all you have is $100K to spend on a boat, you really only have about $75K because the first 12 to 18 months will cost you at least a third of the purchase price.

It's a hellofa jump from a Liveaboard wannabe to being a Liveaboard. It's really not some Polynesian dream. Excluding my note on the boat these are a few of the monthly expenses for a 40 - 45 foot sailboat:
    Annual Slip Fee: $4,400 per year
    Monthly Electricity: $100 month
    Liveaboard Fee: (Yup! Marinas charge a Liveaboard fee) $50 a month
    Insurance: Chesapeake and East Coast Atlantic: $1,550 per year. (And I'm a 100 ton NC/Aux Sail Master with no claims)

That's $604.17 per month without allocating any money for maintenance like:
    Haul out, power wash, launch and 2 weeks on the hard: $400 every 2 years.
    Bottom paint every 2 years (Do it yourself) 2 gallons at $120 per gallon ($240)
    Cetol or varnish every year: $40

Realistically assuming you have a Chartplotter, GPS, RADAR, VHF, SSB, Wind, depth, speed instruments, autopilot, wind generator or solar panels. And then there's the 4 cyl. diesel, possible genset, zodiac, outboard motor, windlass, winches, etc. etc. etc. Your annual maintenance will be at least another $200 per month.

This year my "maintenance" has been almost $5,800. Add that to the $604 and you're at $1,100 per month (NOT COUNTING THE BOAT LOAN PAYMENT).

I'm not telling you not to do it my friend, but this is a serious cash commitment here.

Monthly costs from 2+ years of USA cruising:

Maintenance	$682
Insurance	$299
Marinas	$666
Diesel	$415
Communications	$263

Total per month: $2325

... Dock space and marina space is by far the greatest cost of cruising. and restaurant eating probably second. ...

How much does it cost to live on land? I would bet that no two [people] have the same budget. Neither do any two cruising boats. We have cruised twice and no two boats had the same budget. Can you resist the smell of grilling fish at a beachfront eatery? Can you say no when all your pals hit the bars after a long, nasty passage? Do you need to have lots of people around? That means booze most of the time. Will currency affect your budget? On our first trip to Mexico the peso was stronger relative to the dollar and beer was costly. Next trip the devalued peso meant more to the greenback. Whatever your taste, your cruising budget will reflect YOUR taste and lifestyle. Remember that cruising is life afloat!!!! It would be unrealistic to expect to change your style as soon as you cast off so plan accordingly.

I remember a review years ago that made sense on boat ownership costs. In this, there are three "segments":

1. Cost to buy the boat and sell it the next day; (purchase/sale); plus
2. Cost to keep the boat minimally cared for but not used (ownership); plus
3. Cost to use it in the fashion you desire (usage).

The first relates to the purchase price, taxes on it, sales commissions, any sales advertising, your search and any legal costs.

The second relates to any cartage or delivery costs, various insurance premiums, home dockage and electricity, annual haulouts and painting, opportunity cost if you wish to include it, and change in market price, all in static ownership.

The third relates to dynamic ownership: fuel, replacement of wornouts, upgrades, and other expenses of cruising operations such as transient dockage, mail forwarding, changes in telephone, deposits, etc.

... we have taken numerous courses both on and off the water - we feel full-time cruising is a very serious undertaking.

All of the following is IMHO:

1. Develop a very clear idea of what you want and what you are willing to give up. Many things are mutually exclusive; therefore, every boat is a compromise. If it does one thing then it doesn’t do something else as a direct result/cost of doing that one thing.

2. Physically test out your ideas of what you think you want. Charter, sail on other peoples boats, start out with a smaller boat, etc.

3. Develop your skill levels. We are in our ninth year and know we have a lot more to learn before heading transoceanic. Both of us are fully capable of single handing the boat. If you will cruise with a partner make sure you share the level of commitment to the life style.

The "RULE":

Everything costs - either in terms of money, time or "convenience".

A. The more you can do yourself the cheaper it becomes in terms of money but you will often pay for it in time or even convenience. (check out my earlier postings on pulling the mast - lol)

B. On room - we are going full-time on a Downeast 32 with the Caribbean being our destination. (Our 32, which is a very big 32, is still smaller than some walk in closets.) We intend to move up to a 38-40 if the skill and courage arrive and we decide to head out to the S. Pacific. (A slightly bigger walk in closet with an attached master bath?)

C. Luxuries cost - big time. For us, refrigeration and water making are the two very big ticket items we decided we wanted. Air conditioning is going off the boat and there is no hot water or pressurized system. No tv, video, etc. but a very extensive computer system. Etc.etc. (All this is personal tastes/needs. I think you need to know what yours are before heading out.)

D. Maintenance is a never ending task. You can’t let it go. (On shore, if the basement gets water in it you can get to it someday - on a boat however!)

E. On safety equipment we follow the rule: If we can’t afford the proper equipment - we can’t afford to cruise.

> Can someone give me in round numbers what it would cost to:
> -- completely overhaul a Perkins 50 hp diesel engine
> -- replace the standing rigging on a 39 foot sloop with 54 foot high mast.

There are four questions I have.

1) Will you be doing any of the work?
2) Will someone else be doing the work?
3) Is the one doing the work any good?
4) If that person is any good, does he/she know it and charge accordingly?

The same goes for the rigging.

I replaced the standing rigging on our 39' cutter rigged ketch; wire, sta-locks, a few turnbuckles, and misc. parts for around $1200 USD. (as I recall) ... after paying a 'professional' rigger 300 something bucks for time and materials ... to stop the work we had contracted, leave and never come back.

I learned very early that this fella was a gomer, and just because you're a 'professional' doesn't mean you're any good ... even if other folks pay for your services.

Three observations:

1. Live aboards have to make a basic decision: bring as much of your shore life on board as possible or adapt a much simpler life to the boat. This basic decision will swing your budget dramatically. Both the initial boat costs and annual costs will be hugely different. Just for example we know two live aboard couples each with two kids. Boat #1 who have lived aboard for 8 years spent about $8K on their boat and then put around 2,000 hours of labor into it. Their annual costs have been $6k-$10k. They don't really have an electrical system and they don't have much space, but they very very much enjoy their life and their kids are educated and worldly. Boat #2 who have lived aboard 5 years put $400K into the boat and spend about $20k per year. They have watermakers, microwave, VCR for the kids, etc. They also very very much enjoy their lives, but it is more inward focused whereas boat #1 is by necessity more outward focused. Either approach will work, both are very different from shore life.

2. You don't need lots of gear or strong enough engines to pull away from dangerous weather to be safe and happy at sea. You do need to commit yourself to learning new skills and a new way of life. A landsman will turn his engine on and power toward shore in bad weather, a sailor will turn his engine off and sail away from shore.

3. There seem to be four models for financially successful live-aboards:
(a) Those who retire early with a good pension (like after 20 years in the military),
(b) those who own and are renting out real estate (although this group tends to have ocasional emergencies with their tenants),
(c) Those who made a lot of money relatively young and are living off the interest, and
(d) those with almost no assets but have portable skills who work when the case gets low (the three best skills seem to be medical, boat, and restaurant related).

We too, sold our house, bought a much less expensive condo to keep furniture and belongings and have a home base. Put much of the profit from the sale of the house into a heavily built, seaworthy boat.

We learned the hard way that $25,000 per year was inadequate to maintain the boat up to our standard (that means if something is broken it must be fixed - not neglected), keep insurance (health, life, boat) pay taxes, food, clothing, occasional dockage, fuel, etc and fly home once or twice a year to visit family.

We did 90% of all maintenance ourselves, but had to pay for it when it was beyond our skills (not much was, but when necessary, it was very expensive).

As to boat insurance, many cruisers opt to drop this because it can be expensive. Their rationale is that they would rather put the money saved into very good equipment to avoid accidents that could destroy or sink their boat. To my way of thinking that is unrealistic. You can not protect your boat from serious acts of nature or things that can happen to it when you are not aboard or awake. The boat represents the largest portion of the cruiser's assets and should be protected. We came across many examples of what happens to the uninsured, underfunded cruiser in our travels. They are very sad and hopeless stories.

We had owned sailboats for 30 years prior to our departure, so thought we knew just about everything we would need to know to cruise safely. Just to make sure, and to refresh knowledge not often called upon, we read the course material for the Coast Guard Master's License. Lo and behold, there was much we didn't know! We studied and passed the exam.

We also studied for and gained our Ham Radio operator's licenses. We installed a Ham radio and found it be be very useful.

We took our boat to a Community College in Jacksonville, Florida where our old Perkins 4-108 engine was removed and brought to their shop. We lived on board, at their dock, while we attended classes on how to repair and rebuild our diesel engine. The lessons learned there came in mighty handy later on.

We cruised for 4 1/2 years before the money ran out and we were forced to return to shore to make a living.

Bottom line:

1. It is a fantastic way of life. Much to see and do. Much to learn.

2. "Seaworthy" generally (but not always) means "more expensive". That is not to say that all more expensive boats are seaworthy.

3. Falling in love with a boat can be a dangerous thing. I did, and it clouded my judgement. I should not have bought the boat I fell in love with. I should have remained more objective and kept searching for a boat that would require less upgrading and less maintenance.

4. Don't be discouraged by what may appear as negative thoughts in items 2 and 3 above. They are meant to give you some perspective and ideas on how to proceed, not turn you off. I am saving now to do it again.

Re: How much does it cost to cruise?

Seems there are just too many variables to give an answer that is meaningful to everyone. I have picked up a few things from my friends that have gotten away ahead of me.

The statement "It will cost what you have" is only true if you don't control your costs. If you don't do that while on land you probable won't when you go.

"The parts that are not boat will cost about what they do on land." This means food etc don't change just because you move on board. You will continue to eat etc about as before. However this is not true depending on where you are. Some countries are cheaper and some more.

"If you can do your own maintenance it saves a lot." This is also true on land before you go.

Of the 9 different couples that I have been friends with for a long time, that share this kind of info with me, and that are "out there" the average monthly total expense is about $1800. They all have boats between 34 and 42 feet. They all do their own maintenance. They are just down to earth people like me and don't "high roll." They are currently everywhere from South Pacific to Caribbean to DOWNTOWN Paris. That last one says the expenses have become HIGHER lately.

Most like me prefer a "cook out" or entertaining on the boat to a restaurant.

They keep sending me e-mails saying "Wish you were here". They are killing me.

The first thing you have to realize is that you are not on vacation. I took 3 years off to travel and live on my first boat. When I got home and took stock of my expenses, I discovered that I was still alive in spite of the amount of alcohol I had consumed. The first year was expensive because I was on vacation: lots of eating out seeing the sights going to the bars often. Just a big party (loved every minute of it). In the second year friends dropped down and I continued to party because they wanted to see everything and I was their guide; they were on vacation and had the budget to play. I started to run low and didn’t know how to say "Have a good time". In my last year funds were getting low and if I wanted to stay I had better learn how to live the lifestyle I could afford. One thousand, two thousand, three thousand, how about less than one thousand? As I said "LIVE THE LIFESTYLE I COULD AFFORD". How often do you go out now? How much money do you spend now on eating out? Unless you suddenly come into a bundle, look at what your lifestyle is now. In my 3rd year I told friends that if they wanted to have me along at the bars or dances they had to pick up the tab. I was providing them with a bed and transportation to reefs and interesting islands but I couldn’t keep up with their expensive Vacation budget. They understood and to my amazement we had a great time sometimes without me. But I had already been there and done it and the T shirt was getting thin.

What I’m trying to say is it's possible for a couple to have a good time, party once in a while, and generally enjoy themselves for less than $1000 a month. If you are planning to make it a lifestyle. If it's a vacation that includes those that put a 2, 3, or 5 year limit and then plan on going back to home port. You are not really committed to sailing/traveling as a new way of life; you're just testing the waters. Go with the intention of staying and budget accordingly. There are lots of things to do that will entertain and amaze you. How do you do it ? There have been books written on that topic. Every case is different; you just have to answer a few questions honestly. How much money do I have? How often do I party? And on and on; the questions aren’t rocket science, just common sense. The last question is how much am I willing to go without? I decided I needed a larger boat ...

There is a a theory that expenses will rise to meet whatever you have plus 10%, and I have seen many cruisers who have succumbed to that trap.

I hate to be simplistic but it really all depends on a three factors: Mindset, Where you cruise and how you cruise. Sheila and I have seen people spend incredible amounts of money in places that were dirt cheap, as well as people spending hardly anything in places that were absurdly expensive. So it really comes down to attitude and mindset!

Boats with lots of toys and gadgets cost more to run than boats that have less. They also have to spend more time in port getting things fixed.

Everywhere we have cruised we have found that anchoring was never a problem (our total cost for a year in the Med in marina costs was about $750). Down here in the Caribbean there is no reason to do marinas (unless you like bugs onboard). To be honest as our boat is not air-conditioned we find marinas hot and uncomfortable, so much prefer the boat on the hook anyway, and if we find it gets uncomfortable we just move to the next anchorage.

Might want to take a look at the book "Voyaging on a Small Income" by Annie Hill as a reality check; she certainly could teach us all something about cruising in general. I don't agree with everything she says but 80% is right on. Lin and Larry also are a good source (though for some reason even when I agree with them they tend to piss me off).

Our European friends came up with a great term for the style of a lot of the American cruisers in the Canary Islands before our crossing: Consumer Yachting! Sad to say it fits but is easily avoided if you look to what is important to the task at hand and your "REAL" comfort (not what someone tells you you need!).

When we built our boat we had a lot of ideas about what was needed for cruising. Had lists of lists and they all seemed like a good idea at the time. But as our trip went on we found as time went by we shed a lot of excess weight and gear that never got used or systems that were more trouble than they were worth ... evolution of sorts.

Oh, by the way, our average monthly for three years of cruising and 28000 miles came to $387 for food, entertainment, boat systems and repairs. When we decided to stop for a bit and go back to work for a while our boat was in better condition than when we left!

• [From Dan Spurr's evaluation:]
  Expect to lose about 30% of your investment when you sell your boat.



• Maintenance is essential; upgrades are optional.



• Upgrades are most valuable to you if they are in harmony with the common use of your boat.



• To minimize the "loss" when you sell:
  • Don't buy/sell often.
  • Sail often, to get maximum enjoyment for your money.
  • Don't buy bigger than you need.
  • Don't buy upgrades you don't need.

... During the 7 years [1992-1999] we owned our diesel trawler we replaced the Loran C once and the GPS once because of new technology. We even replaced our VHF radio 3 times and our TVs on board 3 times. Our refrigerator was replaced twice and our propane stove once. In short new electronic technology will come and go at an alarming rate. Many boaters replace this stuff routinely at the first sign of a problem because it is cheaper to buy newer electronic technology than repair old. ...

I have found that the cost of living is dependent on the "standard" of living you want to achieve, or better yet what you feel you need to have. I have lived aboard and cruised on $100 a month for a three month period and was quite happy sailing the Chesapeake and NC Sounds. Then again I have spent $100 in one evening on other cruises to the same places, and left a lot fatter from a meal ashore and with a throbbing head the next morning.

Bottom line, once you eliminate boat expenses (I actually mean minimize) you can sail on almost any budget. The more gadgets you have the more your long term cost will be. I say Stay Simple. (could be that boat name I have been looking for, eh). I sailed for four days once with a gallon or two of water, five pounds of potatoes, a can of beans, and only six gallons of gas. So those days only cost me about $10. It was a great time.

Some tips to eliminate some costs are:

- Stay simple. Some ruffles are good and nicce, but choose them wisely.
- Don't be in a rush.
- Sail when there is wind. Anchor and do boaatwork, relax, sleep when in the calm.
- Try to eliminate dockside time. Use your mmandatory gas stops for your service needs/layovers.
- Take a dinghy and some oars. Leave the o/bb stowed (for emergencies only) or onshore.
- Eliminate the unnecessary, consume less, eenjoy/appreciate more.

I am sure there are about a thousand others that I can list, but I think you get the idea.

The overall cost analysis breaks this issue into the following elements:

(1) Capital Expenditure
Building or purchasing seaworthy boat at minimum cost in reasonable time frame.

(2) Maintenance

(3) Operating costs
The low-cost voyaging should be based on minimal operating cost, parking on bilge keels, not entering marinas, using as little as possible of diesel, relying on alternative energy.

(4) Subsistence
Purchasing, fishing and foraging to provide a heathy diet at reasonable cost.

(5) Income
Generating an income stream while cruising to nurture the financial resources.

... the cruiser usually lives happily without many of the trappings of life on land. The key to a moderate cost of cruising is cost avoidance. By giving up expensive clothing, high-priced restaurants, real estate, telephones, cable TV, furniture and household goods, vehicles and the associated upkeep, taxes and insurance, many of the land costs simply go away. ...

... you can make some of those unnecessary land costs go away long before you go cruising. ...

Ways to reduce costs:

• Own the best possible boat: no larger, more expensive, or harder to handle than necessary.



• Do as much maintenance as possible yourself, and plan routine preventive maintenance.



• Ignore advertising intended to make you add expensive gear such as instruments and sails that may make sailing easier and faster, but seldom in proportion to their cost and complexity.

Use the boat. It is one thing to get continual real pleasure out of owning a boat that extracts a hefty toll in time and money. But it's quite another to face that toll and leave the boat neglected, tied securely to her expensive dock.

I remember one of the sailing magazines conducting a fairly serious survey of cruising expenses. They broke it down into budgetary cruisers, middle of the road people, and top end people who could pretty much do whatever they wanted to.

For some reason I remember it averaging:

Low - Less than $1000 per month - No eating out, small boat, no docking except when you have to, low to no overhead of equipment.

Middle - $1500 to $2500 per month - Some eating out within reason, docking some more along with a fair amount of equipment to maintain.

High - Over $3500 (more like $5000) per month - Full-bore eating out, dock all the time, full complement of sailing gadgets and trips home to vacation from the cruise.

In a lot of fora people say they did or do it more or less spartan on 1000 USD a month. Last januari I spoke to a cruiser who had been cont. cruising from may 1999. He had registered all payments. Amounts are euro's. This cruiser was underway with a 49 ft steel sloop with his wife and 12 yr old daughter. He never tied to a pier, stayed on anchor. He summarized his exp with: "Europe is two times as expensive as wherever on this planet".

	may '99 to jan '05	per year
Marina's / mooring	0	0
Fuel	3.876	684
Butane	268	47
Lubricants	473	83
Petrol	989	175
Maintenance +haul-out	8.712	1.537
Clothing	1.341	237
Out to dinner	2.865	506
Education	489	86
Entertainment	1.034	182
Food	23.709	4.184
Harbour-fees	10.354	1.827
Immigration	1.707	301
Laundry	686	121
Permits	61	11
Medical	2.220	392
Misc(flying, water)	3.693	652
Paper, printing	524	92
Telephone, internet	2.864	505
Transp,rent,fuel,fedex)	4.751	838
Total	70.640	12.466

Another cruiser gave me this. 2 persons, in USD, 6 times haul-out and flown home. Part of boat-equipment bought after departure.

	per year
Boat Equipment	5.270
Food & Beverage	4.496
Maintenance & Repair	2.975
Transportation	2.383
Gifts & Souvenirs	1.928
Boat Insurance	1.913
Restaurants	1.802
Moorings	1.652
Medical & Insurance	1.370
Charts/books/film	1.312
Clothing & Personal	1.260
Hotels/Sights./Entert.	991
Communication & Postage	882
Membership Fees	670
Operating Costs	634
Miscellaneous	527
Cruising Fees&Licenses	428
TOTAL COST	30.493

Myself (we want to start our trip with a 50 ft alu sloop in 2007). I plan on *having room for* 2500 euro's a month and that's (I hope) not synonymous with actual spending. With that amount we will have to pay for *all* expenses. We do want to insure medical costs (600 euro's pp/year, all countries except usa) and we do want our boat insured (2000 euro's/year, with 2500 own payment when there is a claim). This is what our budget looks like:

harbour-fees (incid. marina)	3.500
Immigratie,in-&exit-fees	800
Fuel	1.200
Maintenance&Repair	7.500
Insurance boat	2.000
Medical costs	1.500
Clothing	1.000
Food	4.000
Out to dinner/entert.	2.000
Transp.(car-rent,fuel,fedex)	700
Comm.(Internet/Tel/Sailmail)	500
Travel(tickets)	800
Misc.	4.500
Total	30.000
per month	2.500

Re: Costs?

From experience I know that the answer to your question is difficult to answer with much accuracy, but here goes.

The larger the boat the more it will cost to maintain, insure, obtain cruising permits, dock, haul, and provision. A good rule is for every 10'/3m over 25'/8m the costs double (e.g. if your costs are $5000/year for a 25', then you could expect to pay $10k/35', $20k/45', etc). The average size of a cruising boat is around 35-40' which is a good compromise between living space, costs, and comfort. The type of boat you buy is not something you asked about.

The type of lifestyle you choose will affect the cost of cruising. If the boat is "bare-bones" then the costs will be the lowest. Costs will multiply (e.g. satphone vs mail, satphone vs SSB/HF, genset, AC, water maker, dining ashore, not having a love of fish and crustaceans, dock vs the hook, flights home, extensive travel in remote locations, rental vs walking, running the genset/engine to produce ice for drinks, etc) as you add creature comforts and enjoy living aboard rather than camping aboard.

Cruising the temperate climates will cost less than going pole-to-pole. Putting your boat on the hard to build the kitty will cost money.

Provisioning costs will depend on your willingness to wean yourself from meat and become more vegetarian, rice and beans will replace potatoes, fish will become the predominant protein, and in general eat what the locals eat. Provisioning has changed more than cruising and most large ports have good supplies so the idea of carrying 100 rolls of toilet paper are largely gone. These costs can be offset by buying what's available locally at cheaper rates than other areas, knowing that certain areas (Tahiti for example) are very expensive except for subsidized items. Stolen items will be costly to replace and major problems require setting aside a portion of your kitty for emergencies.

When I started cruising on my 37' sloop in '92 I got by on about $500/mo by anchoring out, using a wind generator to charge the batteries, and enjoyed catching and eating seafood. I ate ashore seldom (generally rewarding myself one night ashore during my stay, never on the first night, for the passage), did my laundry in a 5-gallon bucket, took sun- showers, and read. My largest expense was for my camera (I'm a semi-pro photographer and dive instructor), my dive gear, and dive instructor fees/insurance, my laptop (for correspondence, route planning, etc) and my SSB (for WeFAX, ham-assisted calls home, and listening to the world). Along the way I added a tape recorder to record music in places I visited knowing that tape was cheaper than pre-recorded cassettes). I also added a car stereo/CD player for nights when HF wasn't coming in well.

I have no TV/VCR but I do have a 2000w charger/inverter. I sailed with a GPS, depth sounder and knotlog. If given I'd gladly take a radar and chart plotter but the cost of those items (and their power requirements) would allow me to cruise for many months. The plus is that the passage would be less stressful. I have added wind instruments and a windvane (to complement my autopilot). I carry charts (swapping along the way for the next leg), use a sextant for GPS verification, and am a voracious reader. Discretionary money usually goes for cruising guides, pilots, weather GRIB files, email, and the occasional souvenier.

In 2002 my tastes had moderated some (still no genset, water maker, freezer, unplanned trips home, etc) and I averaged about $1000/mo. In the last ten years my dinghy motor was stolen ($1200 for a 15 hp), my new/used 10' inflatable disintegrated after years of use ($1000 for a newer/used one), an engine overhaul due to defective anti-siphon valve ($2400 for parts, postage, phone calls, and a mechanic to check/bless the repairs before I started the engine), new rigging ($2000 upsized one size, new ends, and a good quality rigging cutter), a set of sails ($3500 and they need to be replaced in the next year or so), a new water tank when the original one gave up the ghost ($700), and a cutless bearing ($800 for haul, pressure wash, week on the hard, bottom paint, and relaunch). Add in $500 for a GPIRB to replace the old 121.5 model and a new pair of high-quality binoculars, $1200 to replace the deep-cycle batteries twice due to age, and a set of solar panels (lower charging power but far quieter and safer than the wind generator) and not much else has changed.

I had budgeted money for rebuild kits for the windlass, roller furling, winches, stuffing box, hoses, wiring, switches, clothing, new chain, new lines, and other maintenance items.

If I amortize the big-ticket items over the ten years I averaged about $850/mo. If I start from the loss of the outboard (first major unplanned item) then it's closer to $1200/mo. I'm back in the States rebuilding the kitty and will be leaving again in 2008. I figure that I'll be in the $1200/mo range when single-handling and $2200/mo with my partner.

My lady likes to paint so that'll add to the cruising costs. I've gone digital and that'll be a new expense (hopefully cheaper and easier to produce high-quality images). I've replaced the underwater housing for the camera after 3000+ dives, and am giving serious thought to a satphone for emergency communications.

As I reread this I'm getting a bit disillusioned. I know I'll have to work harder and longer to build up the kitty if I'm to do the circumnavigation, but I also know it'll be worth it. The friends you make, experiences you enjoy, cultures you meet and interact with, and the enjoyment of something new over the horizon or in the next anchorage, and old friends you meet in the most unexpected places more than compensate.

Pick up Beth Leonard's "The Voyager's Handbook", Jim Trefethen's "The Cruising Life", Nigel Calder's "Cruising Handbook", Dave and Jaja Martin's fine book to get different but remarkably similar opinions and real-life cruising experiences. Join the SSCA/CCA or whatever cruising club you know of and read their cruising reports/letters. Talk to the folks at Bluewater Books, Armchair Sailor, or any good nautical supply store. Many of the employees (particularly at Bluewater and Armchair) are cruisers who have either swallowed the hook or are building the kitty. Their knowledge and those of boat-specific support web-sites, cruisers you meet on the docks, and articles you read will help you get a handle on this tough subject.

And remember, whatever style you choose can be modified as time goes on.

We spent two years sailing west from Guam to the Caribbean via the Red Sea. We figured it cost us (the wife and me) $750 USD per month and we weren't consciously trying to be frugal. We did, however, avoid marinas.

We always ate well, always had cold beer in the fridge and a bottle of wine to share. And, I'll admit, we cranked-up the engine whenever our speed dropped below three knots.

Oh! ... and we had a LOT of fun, too!

Our boat was a 37' cutter and (luckily) we suffered no major break-downs along the way. The only thing we're gonna do differently next time we set out is take more time to travel inland ... and further off the rhumb line.

$750 per month for two people - easy!

The cost of cruising depends on how much or little money you have to spend. Using marinas eats very hard into the kitty, as does motoring when the wind isn't good enough to sail. Food costs, fuel and just about everything else varies so much from place to place it isn't possible to give a 'basic costing'. I eat a lot of fish and buy local produce where I can and don't hang out at marinas or drink more than the odd one. I can live on about 30% of what I 'needed' on land. But again it all depends on how you want to cruise. If you want to it can be done very economically with a little thought about preparation and where you buy WHAT you need. For example an oil filter in Australia for my yacht motor is bought at an auto shop and not at a chandlers, saving about 40%, and is the same filter number and listed for the motor.

Have you ever made a list of what you spend on your land life? Telephone, electricity, heat/aircon, mortgage, property taxes, TV, ... ?

Not much goes for food compared to everything else, eh? Get rid of all those expenses and life is easier right away!

• "Too many people spend what they 'have to' on the boat and use whatever's left to go cruising. All too often, that means spending more than was necessary for the boat and cutting the voyage short when the funds run low. Given that many inexpensive boats safely complete major voyages every year, a better approach is to allocate money to the cruising kitty first, then decide how much boat you can afford."



• • Living expenses: provisions, entertainment and excursions, dockage, communications, fuel, customs fees, laundry, charts and guides, etc.
  • Boat expenses: maintenance, repairs, upgrades, boat insurance.
  • Discretionary expenses: souvenirs, travel home, health insurance, health care.


• "Around $4000 [per year, for a couple] in living expenses [doesn't include boat expenses and discretionary expenses] is the absolute minimum we've heard of to keep body, soul and boat together, with the vast majority of that spent on food."



• "It's almost impossible to pay out less than [the low-end couple] spends on annual expenses - $8000 - without cutting corners on boat maintenance or nutrition."

Re: Costs for cruising couple:

FWIW, we cruised for slightly more than a year for $1200 including all boat expenses, souvenir purchases, occasional meals out and bar tab, in short, everything. We had the boat thoroughly stocked when we left so didn't have to reprovision for quite a few months and that was largely replacing small consumables like popcorn, hot sauce and peanut butter. Boat was new so didn't have any significant expenses there. We caught/shot/speared much of our protein and bought fresh produce from the locals where available. Our alcohol consumption was minimal, mostly an occasional beer on a hot day. We hiked, snorkeled, and explored on our bikes for entertainment and never ran out of things to do. One of the few times in my life haven't had to watch my weight.

Now for the caveat. That was 30 years ago so you have to multiply that figure by at least 5 to get today's dollars. If you are content to anchor out, stay out of tourist-trap shopping centers, eat most of your meals in, and live off the local economies, you can cruise very cheaply. I would also add, a lot more enjoyably than playing marina on the left and hanging out with the marina crowd. To each his own, but cruising doesn't have to be expensive but you have to do it simply.

From Rosalie B:
From Jeff & Judy Wahl:
From Rit:
From Normandie Fischer:

We have lived on a 45 footer for 2 1/2 yrs including last winter in the Eastern Caribbean and we are starting a circumnavigation in the fall. We tend to live quite simply on the boat - for example, no nights in marinas in last 6 months, eat out about once every 2 weeks on average and eat whatever is available locally at a decent price - sometimes this is quite like North American food, sometimes not, either is fine. Our boat is quality-built but almost 30 years old. We spent close to $60k getting it ready for extended cruising (don't assume that because the boat you are buying is newer that there will not be considerable expenditures to be made, but that is a different topic.

So much for the context. Our spending in Caribbean averaged about $1200 a month not including insurance. One month it was closer to $4000 because we decided to upgrade the windlass and get a new laptop and prices in St Martin were excellent. We had no significant breakdowns on the boat with something over 6000 miles travelled so boat expenses each month were modest. We did have contingency funds available but did not have to use any. Previous messages mention $100/ft/month, in our case that would be $4500 per month. I don't think that anyone we met in the Caribbean was spending nearly that.

Cruising in the Med and other parts of western Europe is a different matter entirely. Many of the Europeans we met in the Caribbean said they were there because sailing was so expensive in their home countries. For example, apparently there are no (as in none) places to anchor on the Med coast of Spain and dockage for a 40-footer for one night is generally around 70 euros. Also other things are very expensive as well.

You also mention going back and forth across the Atlantic. This is not a casual undertaking and will be hard on the boat even with crossings in the best seasons and best places. Most people sail to Europe and stay there for some time (2 to many years) before coming back to the Americas. Our original plan was to sail to Europe this summer and stay there for a couple of years but it seemed to be out of our budget range.

...

Our insurance was around $4300 a year for a boat worth $180k. We are likely not going to keep full insurance for next year and have only liability insurance. This will be much less money. We do not have health insurance. We are Canadians and have some overseas coverage from this (depends on how long we are out of the country at any given time). Also, the cost of paying for any needed health costs are manageable anywhere but the USA - we heard of people getting treatment for a major laceration in Grenada (3 visits to a clinic) with a total cost of $15 for the medication used.

Last summer we delivered a Lagoon 50, a 50-foot catamaran, from La Rochelle France (on the Atlantic coast) through the Med to Port Said, Egypt and on to the Red Sea. On board we generally had 6 to 8 people (crew and guests). Over the years we have heard how expensive cruising in Europe is and we budgeted accordingly.

The reality ? Cruising in Europe is as expensive as you want it to be. Our most expensive marina cost was 180 Euro/day with metered electric and water and Wi-Fi charge on top of that. That was in Palma de Mallorca and we could have avoided those high prices if the owner's rep had been willing to moor a little ways out of town and reserve a space in advance. Our cheapest marina cost was 0 Euro/day. We tied up to a barge in a deserted marina in Greece. No water or electricity available. Most often we paid from 35 Euro to 60 Euro/day (and that was with the extra tariff for catamarans).

What we learned (and were pleasantly surprised to find out) was that it is still possible to anchor throughout Europe with only a few exceptions. We met cruisers who regularly anchored out for a week or two and then came into a marina for a day or so to top up batteries and water tanks, do laundry and provision ... the usual chores.

Food costs are similar to the USA and often cheaper. If you shop in local markets you can eat like a king. Eating out never cost us more than 25 Euro a person for a 3-course meal with wine. But we like to ask the locals where they eat and to try to avoid "touristy" places when we can.

If you put solar panels, a wind-generator and a watermaker on your boat, you can save yourself money by being able to avoid the expensive marinas. (We had to pay 50 Euro for water in Palma de Mallorca because we arrived on the weekend of the biggest race and all the berths were full. If we had had a watermaker - which the owner refused to buy - we could have saved the money and agravation and anchored out.)

We set sail last August, 2009 from Hawaii and are now moored in Duxbury, MA. Our boat is a 52' Motorsailor and cost in the range you are planning [$300K ?]. Jungle was sailed from New Zealand to Hawaii by the previous owners. All totaled: 12,392 miles sailed since last July, of which my wife and I sailed over 8,000 miles, with crew for the longer trips. We spent 6 months in San Diego readying Jungle for live aboard cruising at a rough cost of $70K (I planned $30-40K). We left mid-March and basically sprinted from San Diego to Boston in 3 months. This jacked up costs and we now plan to slow down to enjoy and reduce costs.

My experience is 10 months living on board and taking into consideration the first year incurs the highest costs:

Rough monthly costs:

- Boat Ins: $750. Currently using Lloyds for ocean crossing.
- Health Ins: $600. Will most likely increase year to year.
- Food, drink: $400. Five crew from HI, three crew from San Diego.
- Entertain: $300. We like to eat out, may be low.
- Fuel: $700. We've been on a mission to arrive Boston.
- Maint: $450. Eng/Gen on high usage, always work to do.

Total/month: $3200. I'll argue with myself - this is low.

Emergency funding: $20,000 (major failures).

Additional comments:
- the "make ready" will be much higher than you think (a la home remodel).
- do as much yourself as possible - critical for cruising (when no help around).
- the frequent visitors will get old and expensive - it did for us.