The Real Costs of Owning a Boat

If you’re considering buying a boat it’s an exciting time, but you’ll likely have many questions. What kind of boat is best for me? Where would I keep it? How much will it cost? Doing your homework is important before diving headfirst in, and figuring out your finances is one of the first steps. Once you know what kind of boat you’re interested in (or have narrowed down the options) you can start putting that all-important budget together. At Rightboat you can search through thousands of new and used boats for sale to get an idea of asking prices to see what suits your needs and budget. Do you want a fun bowrider, or ultra-fast offshore fishing boat? Do you want a cabin cruiser that would offer the chance for weekend cruising? Or perhaps you’d like to learn to sail. You need to narrow down what you want to use the boat for and use that as your starting point for creating your budget. To enjoy your boat to its fullest it’s important to look beyond the initial price tag at what can be hidden costs of owning a boat. 

The Initial Purchase Costs: What Kind of Boat Can you Afford? 

Purchase cost

Buying the boat is the very first step, so what kind of boat can you afford? The answer depends hugely on many factors, from the age of the boat to size, location, style and condition. Use the search tools on boat buying and selling websites such as Rightboat to see what’s on offer in your area and get a good idea of how much different types of boats cost. It’s worth noting that you don’t have to buy your boat outright and there are loans and marine mortgage lenders which will allow you to make monthly repayments over a set number of months or years. 

Survey and sea trial

Depending on the size of the boat you’re buying you might want to consider getting a boat survey and sea trial conducted. This is usually done after offers have been made and is paid for by the buyer. You can expect to pay upwards of $20 per foot for a pre-purchase survey and sea trial. 

Trailer

If your boat can be trailered then factor in the cost of the trailer itself. It can often be negotiated into the sale price, especially for new boats, but it’s also worth asking the seller of a used boat too. The cost of a single axle boat axle can range from $700 to over $3000 depending on the size, while tandem and tri-axle trailers can cost from $1000 up to $8000. 

Equipment

Irrelevant of if you’re buying a new or used boat there is likely going to be some equipment you’ll need to buy. Safety gear such as life jackets, paddles, horn, personal locator beacons, EPIRB, marine radio, fire extinguishers and signal flares are a must, but you might also want to consider investing in or upgrading accessories such as stereos, fishing gear and watersports towing equipment. 

Licenses

In the US most states will require you to have a boater’s safety course and operator’s license as minimum, and the exact requirements vary between states. Check out the National Association of Boating Law Administrators (NASBLA) website for specific requirements. Most courses can be completed online, and while there are some free ones you can expect to pay around $29 to $50. 

Boat registration

Likewise, when it comes to boat registration and titling fees each state has its own requirements. The price you’ll pay depends on the size of the boat and the class. 

The Annual Costs of Owning a Boat

While you can’t put a price on the happiness that boating brings to your life, the initial costs on your dream boat are just the beginning, and the annual cost of owning a boat will vary depending on the size, style and age of the boat. There are a lot of variables that will affect the overall annual costs, and there are some excellent boat cost calculators around, but you’ll need to factor in:

Marina fees

This is likely to be your biggest expense if you can’t keep your boat on your own property. If you choose to keep your boat in a marina then the price you pay will depend on where that marina is (more accessible locations or high demand areas cost more), the facilities on offer, and whether you have a walk ashore marina berth or a mooring accessed by tender or water taxi. In-water dock space can cost anywhere from $1,000 to more than $5,000 per season. 

Storage

How you store your boat will depend on its size and the weather conditions where you keep it. In colder climates winter storage involves winterization of the engine as well as storage that protects it from the elements. Boats can be shrink-wrapped for outside storage a cost of roughly $10-15 per foot or stored on an inside rack for around $50 per foot. 

Insurance

As with all things boating the cost of insurance is affected by several factors; the size, style, age, location, where it’s stored, where it’s used, your level of boat handling experience, your boat driving record and which deductible you choose will all play their part. As a general rule, you can expect to pay around 0.5% of the value of the boat annually. You’ll need at least liability coverage, but most marinas (and certainly lenders) will ask for comprehensive insurance. 

Gas

Trying to calculate the exact cost of gas is almost impossible as, once again, it depends on a whole host of factors. There are lots of good gas calculators online that you can use to help you but you’ll need to know the variables of your boat including:

• Kind of boat: The vast majority of boats in the United States are trailerable under 26 feet in size which means it is likely they are being fueled at regular gas stations which is a cheaper option than fueling in marinas - which larger boats will need to do – and which can cost up to 50% more. Likewise, some types of boats are simply thirstier than others. A pontoon boat will have much lower horsepower and therefore use far less gas than a center console fishing boat for example. 
• Cruising speed: This one is a simple calculation; the faster you go, the more gas you will use. Your cruising speed might vary considerably on each outing too, so calculating your gas usage will depend massively on whether you’re heading offshore on a fishing expedition, or gently cruising along the coast or lake. 
• Location: The same way that regular gas for road vehicles varies from one place to another, so too does marine gas. Where there’s high demand and in peak seasons, expect to pay more for gas and know what the average market price per gallon of fuel is in your region. 
• Type of fuel: The price for diesel and petrol varies quite considerably, so keep that in mind when calculating fuel costs. 

Maintenance and repairs

Boats will always need a lot of care and maintenance to keep them in good working order, especially those which are kept or cruised in the sea where salt water creates corrosion. The best rule of thumb is to keep a strict maintenance schedule as it’s easier to maintain your boat than keep fixing or replacing things that have been left. As a rough estimation you can expect to spend around 10% of the value of the boat on upkeep each year, but that also depends on the age of the boat (newer boats need far less maintenance and it’s estimated you’ll spend around 2% on maintenance each year), and how much you can do by yourself. 

Maintenance will include everything from servicing the engine to cleaning, hull maintenance, winterizing (if you don’t or can’t use the boat year-round) and haul-out (if you’re not keeping it in the water year-round). It is recommended boats are taken out of the water once a year for general maintenance and to get it anti-fouled and the sacrificial anodes changed. You’ll also, depending on the type of boat, need to check the sails, ropes and rigging, do some painting and varnishing, and maintain and service electrical and mechanical systems such as marine toilets, generators and bow thrusters. 

Depreciation

Most boats will go down in value over time, and you need to calculate that into your annual costs because what you get back for it when it comes time to sell it will be a very different price than you paid for it. Brand new boats depreciate the most and quickest, with most depreciating by 40-50% of their initial price over the first 8-10 years (with half that amount lost in the first two to three years). Used boats generally depreciate around 5% each year. 

Cost of Owning a Boat per Size or Type

As we’ve seen, the cost of owning a boat varies hugely and the biggest influencing factors are the size and type of the boat. Ultimately the cost of owning a small boat is generally less than the cost of a much larger one. They will have more mooring and storage options, they can be trailered, lifting them out of the water costs less, the maintenance will be less, as will the insurance and depreciation. Having said that, the type of boat will also play its part, and the cost of owning a 40 foot boat for example, will be very different if it’s a 40 foot trawler yacht or a 40 foot sailboat, or whether it’s brand new or used.

Related article: Top Tips to Lower the Cost of Boat Ownership