Total Cruising Kitty

[Crazcarl]

Hi All,

This is my first post so be kind....

My wife and I have started to save for our cruising kitty. We are in the process of ridding our selves of things we do not feel we need anymore (gym membership, cable tv, etc..) to come close to as we would like life to be on the boat.

We (engineer and teacher) are in our early 30s and our son just turned 1! We are hoping to save and invest until we reach our savings goal of around 300K. Buy a 40ish mono or cat the year before we are ready to leave and spend that year outfitting her and selling the house, cars, etc, to put back into the kitty. Hoping the land stuff will pay for most of the boat and outfitting.

We would cruise the Bahamas/Caribbean area for 1-2 years to make sure that is what we want. If its not, then my wife will still have a place in teaching (but they will only save her a spot for 2 years), while I find a job.

We have joined a local sailing club and have unlimited access to some smaller boats in the 25-27 range and have been trying to get on them as much as possible. I will soon be looking for more opportunities to get on larger boats and help out locals if and when possible.

Everything I have been reading seems to make me believe that my family can get around with about 1500-2k / month. That is doing as much myself as possible and anchoring most of the time but still enjoying dinners and excursions. If we decide we really enjoy the 2 years, we may venture to the west coast and head over the the south pacific.

Was thinking with the interest in investing the 300k we can almost survive forever out there and still have enough if we ever had to come back in case of an emergency. If it was just myself and wife, we would probably be gone much sooner with much less.

I was more curious on what people have planned to take in their kitty and if they see it lasting. Does this seem like too much and we should be able to leave sooner, or not enough? Is owning a cat 2x as much as a mono or less to maintain?

Thanks everyone

[zboss]

Ask your wife to pursue her ESL certification while you are saving up. Its a good way to continue making money in foreign countries. That way you do not have to spend as much of your cruising kitty!

We find that 2K a month is just enough for my wife and I on our 38' mono hull. Then again, I like expensive beer and wine.

We have a method to save money in the Bahamas - either sail somewhere there is no opportunity to spend money, or don't get off the boat, or touch land.

Land = Money Pit

[Crazcarl]

Originally Posted by zboss

Ask your wife to pursue her ESL certification while you are saving up. Its a good way to continue making money in foreign countries. That way you do not have to spend as much of your cruising kitty!

We find that 2K a month is just enough for my wife and I on our 38' mono hull. Then again, I like expensive beer and wine.

We have a method to save money in the Bahamas - either sail somewhere there is no opportunity to spend money, or don't get off the boat, or touch land.

Land = Money Pit

She has a specialization in Math and elementary ed, so she has done ESL here in the states, but I will suggest and see what she thinks, thanks for the tip!

Yeah, we like the finer beers, but I would expect that hard to find. I am happy with rum or whiskey. Where do you find that most of that 2k goes towards? Food? Repairs?

The majority of the time we would like to touch land, is to hike the trails and explore local cultures. I agree with the go places that you cannot spend to save. One of our intentions is to find beaches/anchorages to spend a few weeks to a month or so and explore, dive, snorkel, and of course just relax.

[sailorboy1]

Originally Posted by Crazcarl

Was thinking with the interest in investing the 300k we can almost survive forever out there

Where do you have you money invested that now days you believe you can get at least a 6% return?

I remember back when I thought that $1500-2000/mo seemed like enough money. But was before I got a boat and found how much it sucks out of the cruising kitty. There's there the health care insurance costs. Now days I have $3000/mo as the target.

Lots of budget threads and I'm sure you can find one to tell you whatever you want to hear.

[Crazcarl]

Originally Posted by sailorboy1

Where do you have you money invested that now days you believe you can get at least a 6% return?

I remember back when I thought that $1500-2000/mo seemed like enough money. But was before I got a boat and found how much it sucks out of the cruising kitty. There's there the health care insurance costs. Now days I have $3000/mo as the target.

Lots of budget threads and I'm sure you can find one to tell you whatever you want to hear.

I currently am invested in my own real estate company, making much more than 5%, invested in Prosper making 13%+, and do the occasional "day" (couple trades here and there in a few days when I see a deal) trading when I have time. I averaged around 10% returns on that last year. (ATT stock, ticker T, pays out 5.7% dividends now. Not saying its guaranteed, but there are other pretty solid stocks where just the dividends are around 5-6%)

I would like to get out of the real estate as it is too much hands on work and plan on focusing on more trading when I have internet access.

I have heard people mention both sides of the health care. Some say they don't get it and see doctors in local cities as they are much cheaper outside of the US, and fly home if needed. I know that doesn't sound the best, but I am not planning on doing anything crazy with a 5 year old on board. We will sail when the weather looks good and plan sufficiently.

What is the typical cost of health care for a cruiser?

Thanks for the advice as I hadn't thought too much on that yet!

[Kenomac]

You'll need to decide if you want to go camping in a boat, or cruising in a mobile apartment.

Right now.... Your budget screams CAMPING!!!

Unexpected stuff comes up, diesel and food are just a small part of it. Nothing wrong with dreaming.

People think the stock market and real estate only go up... I've been around long enough to see both crash four times.

[MYTraveler]

No matter how much you have, it won't seem like enough, but there will be others doing just fine on less.

[Crazcarl]

My wife does have her TESL/TEFL which would be used to teach English overseas. Closer to getting there!!


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[a64pilot]

Originally Posted by MYTraveler

No matter how much you have, it won't seem like enough, but there will be others doing just fine on less.

I agonized on "how much does it cost to cruise" myself for a considerable time. See I'm older once I go, there is no coming back to work, so I figured I had to get it right.
I finally came to the conclusion MYTraveler posted, or to look at it another way, however much you have, you will spend.


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[Crazcarl]

Agreed ken, but everyone needs a place to live, and stocks "always" come back. I am just living off of dividends and not too concerned if the stock goes up and down.


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[travellerw]

Like already posted. There is no answer. Everyone is different.

A blog (husband and wife) I follow recently posted that they originally budgeted $3000/month but dropped that to $1500 after being out there 6 months. It will probably change again as they move around.

[Mark Stillwell]

Of course 5-6% of $300K is $15-18K which is $1,250-$1,500/month, so your investment income puts you below your targeted expenses.

I've run some investment numbers and figure I'd need closer to $500K if I just live off investment income...$25-30K.

Fortunately for us, we are close to the retirement end of the timeline, so will have pensions to cover most of our costs.

Good luck...keep planning...Go For It!! Worst case, you sail until you run out of money.

[robert sailor]

These cruising kitty's are all over the map and for some very good reasons. If your idea of cruising is hanging around the Caribbean or Mexico then your costs should be lower. If you are crossing oceans your costs will be higher. If you are a world class drinker your costs will be higher. If you have fixed costs back home like insurance/storage fees or a home then your costs will be higher. If you actually only cruise 6 months of the year like most do in the Med/Caribbean/Mexico then your costs will be higher. If you are not all that mechanical and have to pay for most/many repairs your costs will be higher. If you add complicated gear to your boat your costs will be higher. If you like to land travel a lot and rent cars your costs will be higher. The longer you cruise, especially if you are putting on some miles, the more it will cost due to higher maintenance and replacements. If marina life is part of your plans your costs will be much higher than just the marina fees because it changes your lifestyle.

[zboss]

Originally Posted by Crazcarl

Yeah, we like the finer beers, but I would expect that hard to find. I am happy with rum or whiskey. Where do you find that most of that 2k goes towards? Food? Repairs?

Our monthly budget at home at the dock in Saint Augustine or when out cruising (and we are new to this as well BTW) is 2K a month. This does NOT include "refit" repairs, which can be significant, but does include all the repairs and maintenance we have to do when out sailing - ONLY because I carry a huge stock of spare parts and I can fix just about anything myself.

When we left for the Bahamas we stocked up at CostCo and Trader Joes and spent about 2K for 3 months of provisions. This included lots of beer and wine... all the way to toilet paper and paper towels. We learned a lot about provisioning since then; we still have lots of stores left two months after returning.

The two largest line items in the "regular" budget are food and eating out. If we shopped more carefully and planned our meals with more precision, we could cut our food bill pretty dramatically. Eating out is completely controllable... maybe $800 a month. If we ate four $50 meals on the boat a month we would drop that expenditure by 25%. BTW - on the boat we ate like kings. I think I have developed gout

It really doesn't take much discipline to not eat four meals out... but as you will learn some cruiser somewhere knows where all the best happy hours and lunch specials are; you need to ask around because this can also save you a ton of money. Also, do not go out for dinners. Stick with lunches if you go out.

FYI - some places in the Bahamas had surprisingly good selections of IPA beers.

Originally Posted by Crazcarl

I currently am invested in my own real estate company, making much more than 5%, invested in Prosper making 13%+, and do the occasional "day" (couple trades here and there in a few days when I see a deal) trading when I have time. I averaged around 10% returns on that last year. (ATT stock, ticker T, pays out 5.7% dividends now. Not saying its guaranteed, but there are other pretty solid stocks where just the dividends are around 5-6%)

I have been doing the Lending Club thing for a long time now... maybe 4 or 5 years. You will NOT continue to make 13%. People in that category stop paying. I changed to only investing in Grade A paper and my investment returns are much more steady... but they are closer to 5%.

Also, those high dividend plays are going to bite you. They are that high because the banks and the big paper holders are trying to attract "investors" so they can dump it. I find that intermediate term bond funds with very low costs, like Vanguard funds do much better over the long run. However, everyone has to choose their own strategy.

[Crazcarl]

Thanks for the info everyone! Yeah we wouldn't eat out much. Maybe once a week on average. We eat out much less now on land.

I use prosper right now and have a quick invest criteria setup. So it automatically invests and only when it meets certain criteria. Only have had it for about 14 months.

As far as the dividends I am not sure I agree. I try to only invest in S&P 500 companies that haven't lowered their dividend in the past 10 years. There are actually funds out there that follow this, but thanks for the concern. I am always looking for new investment ideas and even more now to hit my magical number. For a while it was closer to 500k but thinking I might be able to do 300k. As I get closer I may have to change again, but all I can do now is save and sail when and where possible!

Anyone near the Buffalo, NY area that needs a crew member for the day, please let me know!




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