Being a boat owner comes with some prestige and privileges. You can spend time on the water with friends and family whenever you want. In addition, you can also have some alone time with your better half whenever you want.
So, buying a boat is a dream for most people. But when you consider how much boats cost, including their maintenance, repairs, taxes, and other financial implications, you may want to consider investing your money on something else.
Nevertheless, many people would argue that boats are a great investment. They claim the fun and alone time one can enjoy while on their personal boat is incomparable.
Now, here is the question.
Are boats money pits?
Yes, they are. Boats are among the biggest money pits one can ever think of in this life. A yacht costs over $300,000, a houseboat costs $50,000 and above, while the Jon Boats cost $500 to $5000.
Besides buying the boat, you also have to continue financing it. You have to pay for insurance, maintenance, repairs, taxes, cleaning, purchase gas, and pay an annual winter storage fee.
Sum up the total amount you’ll be spending every year on a boat; you’ll understand how big a money pit boat is.
Read on for more information on this topic.
How Much Do Boats Cost?
We have explained that boats are money pits. They are expensive to buy and operate. Now, you may be wondering how much boats cost.
Well, firstly, boats aren’t as expensive as private jets. But they still cost quite a fortune. Regardless, if you were planning to acquire a boat, it would make sense to learn about the average price of each type.
Check out the table below to know the average price of each boat.
|Boat Type||Price range ($)|
|1||Airboats||$30,000 to $100,000|
|2.||Bow Rider Boats||$15,000 to $50,000|
|3.||Cabin Cruise Boats||$100,000 to $500,000|
|4.||Canal Boats||$100,000 and above|
|5.||Catamarans Boats||$10,000 and above|
|6.||Cuddy Cabin Boats||$50,000 and above|
|7.||Deck Boats||$20,000 to $50,000|
|8.||Fishing Boats||$25,000 to $100,000|
|9.||House Boats||$50,000 and above|
|10.||Jon Boats||$500 to $5000|
The others are speed boats and yachts, which cost $75,000+ and over $300,000, respectively.
Are Boat Registration Fees Costly?
Well, it all depends on what you consider as expensive. However, boat registration fees differ from state to state. But in New Jersey, a boat 65 feet or longer requires a $250 registration fee.
In Florida, the vessel registration fee for vessels 65 feet or less than 110 feet cost $152.75 (class 4). So, you can see boat registration fees are generally less in some states. It ranges from $25 to $250.
A Handy Tip: In general, a boat’s registration fee is a function of the length and type of vessel you’re registering.
How Much Do Boats Maintenance Cost Yearly
Boats are costly not only to buy but maintain. You may have to break the bank every year to keep your boat in good shape.
You cannot forgo your boat’s maintenance. You need to carry out routine maintenance every year to increase its lifespan.
In other words, if you maintain your boat regularly, you may last longer than you expect. If you fail to carry out annual maintenance, your boat’s lifespan might reduce drastically.
Now, how much does boat maintenance cost each year? An estimate by Bloomberg is that boat maintenance is a function of its cost price. And it is usually 10 percent of how much a boat costs.
For instance, if you purchased a boat for $30,000, yearly maintenance would cost roughly $3,000. Boat maintenance includes deck cleaning, hull painting, and changing sail yearly. And all of these cost money.
Now, imagine how much you’ll be spending just to own a boat for ten years. You would have spent roughly $30,000+, and what’s more, if you decide to sell it, you won’t make profit.
How Much Is Boat Taxes?
Another thing to consider before splashing the cash on boats is taxes. Just like cars, you have to pay taxes on your boat.
Rhode Island is the only state where boat owners don’t have to pay a single tax. But in other states, the story is quite different.
In South Carolina, boat tax is 10.5 percent of the boat’s value. So, if your boat’s assessed value is $50,000, you have to pay over $5000 as tax. In South Carolina, the boat tax becomes effective if the boat remains in the state for 180 days or more.
A Handy Tip: In the United States of America, federal vessel tax doesn’t exist. So, taxes on boats are generally imposed at the local and state level.
Additionally, three types of boat taxes exist. These include boat sales tax, registration or use tax, and personal property tax.
How Much Do Boat Winter Storage Cost?
Is your boat in an area that’s warm throughout the year? If the answer is yes, then you may not require winter storage.
But then, we all know that’s not possible. Winter will surely arrive. And proper storage is crucial to increasing a boat’s lifespan.
So, if you have a boat, you have to make plans to keep it safe during the winter period. You have to pay the yearly winter storage fee so that the boat can be taken off the water, shrink-wrapped then placed on blocks.
However, this process might seem simple, but it is not. The people moving the boat have to be extremely careful. Otherwise, they could damage something.
Now, here’s the good news. If your backyard is spacious enough, you can pack the boat there and save the annual winter storage fee. There’s no law prohibiting boat owners from storing their boats in their backyards.
Just make sure you don’t make other neighbors feel uncomfortable. And if you have a neighbor, you can discuss your plans to leave a boat in the backyard before you put it there.
Furthermore, besides your neighbors, you should discuss your decision with your wife and children. Otherwise, you may require a marriage counselor to settle the dispute that may result.
So, how much do you have to pay for boat winter storage yearly? Well, it is usually about $2,000.
How Useful Are Boats?
Well, it all depends on the boat owner. The truth of the matter is people’s wants differ. Our preference for things also differs.
Buying a boat may not be a great investment like a mutual fund or real estate, whose value increases over time. For the record, boats don’t increase in value.
But if you’re seeking adventure, alone time, or an opportunity to bond with the family, you’ll find boats useful. Boats are also great for fishing, not only recreation activities. But the question is, do you have to buy a boat to use it? No, you don’t. You can rent or borrow from a friend.
A Handy Tip: It would make more sense to rent a boat than buy one. Boats are expensive to purchase and maintain. And remember that you’ll use it a few times each year.
Are boats money pits? Yes, they are. You’re better off renting than buying one. The maintenance, repair, tax, registration, insurance, winter storage, and gas make boats a huge money pit.
Yacht costs over $300, 0000 which is a large sum. And remember, the maintenance cost is 10 percent the value of the boat. So, imagine paying $30,000 for boat maintenance every single year. It is not a wise investment decision, as you can see.