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Old 22-03-2010, 21:47   #1
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Boat as Percentage of Net Worth

I've been a boat owner for 12 years, and am thinking of moving up a little to accomodate a growing family, but I'm not sure how much is "prudent" to spend. I'm a tightwad by nature, so it's hard for me to buy anything expensive.

Our boating is three day weekends, year-round. It's where we spend almost all our family time (three days a week), and we all love it. I read somewhere that a lot of Americans spend up to 5% of their income just playing video games and watching movies, so that made me feel a lot better about my current boat expenses.

My current boat represents 2.0% of my financial networth. My yearly expenses on my current boat are about 2.0% of my gross income.

Is there any consensus on what "reasonable" numbers are for boat ownership (weekend-only cruising) as a percent of networth and income?
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Old 22-03-2010, 21:55   #2
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My boat is about 1% of my worth, 1% of my expenditure but 97% of my enjoyment! The other 3% of my enjoyment can occur on the boat as well! :-)
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Old 22-03-2010, 22:00   #3
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Boat ownership is not "reasonable". If I knew what my net worth was I'd give you a number. But I don't. More valuable might be the cash flow. All the cash I have that does not go to the government or teenager goes to my boating.
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Old 22-03-2010, 23:01   #4
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Everyones financial picture and needs are different. If you don't know what yours are you're probably not using an accountant. You've got to figure out what your fixed costs of living are and then what disposable income you have. Gross income is meaningless, net income is the money that have to work with. Make no mistake about it boating is an expense for nearly everyone no matter how they may try to convince themselves that it's an investment somehow. Only by looking at hard numbers can you figure out realistically how much money per year you've got to throw at boating. Over a longer horizon you can adjust your cost of living to allow more disposable income to spend on boating.
Liveaboards will be spending quite a lot of there net income on their boat as it is their only home and can reasonably justify the expense.
By the way at one point my boat was maybe 80% of my net worth when I was young and single.
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Old 23-03-2010, 05:43   #5
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What's the enjoyment you get out of a bigger boat wort to you? As long as you look at that objectively, I don't think there is any wrong answer.

I own one boat that costs as much as my house, but it also generates income and has no over head. No regrets at all. Everyone's situation is different.
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Old 23-03-2010, 11:06   #6
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Quote:
Originally Posted by safarisailor
Is there any consensus on what "reasonable" numbers are for boat ownership (weekend-only cruising) as a percent of networth and income?
The short answer is, no.
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Old 23-03-2010, 11:18   #7
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I throw money away on boats to invest in my pleasure.

Some would argue that a poor investment strategy...I consider it a knack..throw away all you can...
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Old 23-03-2010, 12:19   #8
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Safari,

You're the ony one who can determine how a boat fits in with all your other financial goals and commitments.
But if your family is able to enjoy a boat 3 days a week year round, you could probably justify treating them to a nicer ride.
Many of us in the NE are lucky to get..7 months a year out of our toy.

I would need a net worth of $ 3,000,000 to own my current boat based on your formula. I'm not even close.

If I followed that formula, I should own a canoe. lol

But, I don't have a growing family, with college to save for etc etc.
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Old 23-03-2010, 12:28   #9
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Thats it...

Quote:
Originally Posted by Portobello View Post
My boat is about 1% of my worth, 1% of my expenditure but 97% of my enjoyment! The other 3% of my enjoyment can occur on the boat as well! :-)
Maybe my numbers are slightly different, but the % of enjoyment is exactly in line. Couldn't have said it better myself. I too am a tightwad, but the enjoyment I get from just seeing my boat is completely worth every dime I spend. Might as well spend the money on what makes you happy now instead of giving it all to the nursing home later.
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Old 23-03-2010, 13:33   #10
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Safarisailor's parameters may very well be different than mine, or other's responding to this thread. The use is restricted to 3 day weekends - so the size of the boat is likely small. Price goes up exponentially with size. The percentage of net income or net worth may vary likely as a byproduct of size and whether the boat is power or sail and percentage of free time (non work time) that its used. In terms of 'prudence' that's personal. I spend way more than 2% (by a significant factor) and I make a pretty good income too... I can't spend any more becasue I'm at the max of my comfort zone. Prudence for me is not a penny more - but I do get significant use out of the boat. Its docked 5 minutes from my home so when my wife and I get a sitter we spend some downtime aboard in the winter, we do day trips in the winter, we're out boating most of the summer and weekends in June.... Safarisailor, get what boat you want - but please remember when on your deathbed you won't be saying, geez I wish I was more prudent and got a smaller boat so I could leave more of an inheritance.... Cheers,
Bill


Quote:
Originally Posted by safarisailor View Post
I'm not sure how much is "prudent" to spend.
Our boating is three day weekends, year-round.
Is there any consensus on what "reasonable" numbers are for boat ownership (weekend-only cruising) as a percent of networth and income?
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