Why Your Next Boat Should be Someone Else’s

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Boating for fun was once a rich person’s passion. “Yachting,” they called it. The boats were big and lavish. The costs were astronomical.

Sailboats and powerboats eventually became a middle-class pastime in the U.S. But the Great Recession and the rising cost of fuel made clear just how expensive boat ownership can be.

That made it clear to many that the next boat they own should not be theirs alone. Money Talks News finance expert Stacy Johnson explains how that works in this video. Check it out, then read on for more details about how you can substantially cut the cost of your boating pastime.

You couldn’t give your boat away

After the economy crashed, you couldn’t give away a used boat. In the recession, broke boaters dumped vessels in harbors, rivers and waterways, causing environmental and navigational hazards.

Today’s boaters are wiser about the costs. Many conclude that they don’t need to own the boat to enjoy boating and that cost-sharing options make much more financial sense. After all, 12.2 million boats are registered in the U.S. and the average boat is used just 26 days a year, according to the Miami Herald.

How much can you save? For starters, check the NADA boat guide for new and used boat prices. Used boats on eBay go for a few thousand dollars to $100,000 and up. There are other costs to consider, too: moorage, dry dock, fuel, repairs, upkeep, gear and engines or sails.

Boat Club LLC in Washington state estimates that (without specifying a boat size) the first-year costs of boat ownership amount to about $11,235, including a $3,500 down payment and $375 in monthly loan payments. In comparison, the club’s fees run $2,550 a year for a midrange membership.

Boating without buying

There are many ways to get on the water without buying a boat.

  • Rent through one of the new peer-to-peer marketplaces that bring owners and renters together, making boating potentially cheaper for both.
  • Share the costs of ownership through a time-share arrangement.
  • Join a club that owns a fleet of boats.
  • Charter a boat, with or without the skipper and crew.

Peer-to-peer rentals

Peer-to-peer boat-sharing companies match boat owners with renters. Both national and local companies are entering the market.

Owners who rent out their vessel for one or two days a month could cover the boat’s costs, one company claims.

Boatbound, a peer-to-peer company, takes a 35 percent cut. So, if you rent your boat for $300 a day, you receive $195. The company’s fee covers insurance, towing, listing, promotion and support services.

Another company, Cruzin.com, charges owners 40 percent. Along with other services, it conducts credit and fraud checks and requires renters to have a minimum of two years’ boating experience.

Are you crazy?

Is it crazy to give a stranger the key to your boat? Some owners wouldn’t do it. But others are happy to let a company manage the risk.

“His boat sits at the dock most of the time and [he] would love to offset the cost of ownership,” the New York Boating Club writes of one member who’s interested in the option.

The Miami Herald says of Boatbound:

All potential renters go through a vetting process. Every boat gets checked out before it is listed, and for boats over 10 years there may be additional underwriting requirements, Boatbound says. And if something should go wrong, Boatbound carries Lloyd’s of London insurance — $1 million for liability and $2 million for hull.

If you do offer your boat for rent, make sure to clear the details of the arrangement with your insurance company.

Like VRBO

For renters, selecting a peer-to-peer boat to rent is like choosing lodging from Craigslist or VRBO. You look through the listings and read user reviews until you find a boat and price you like. Renters and owners rate their experiences and each other on the site.

Depending on the company, the inventory of boats might be huge, including kayaks, yachts, powerboats and sailboats, from 15-footers to 50-footers or larger. Some boats come with a captain. Most you operate yourself.

Prices range from $200 to $14,000 a day. You’ll pay extra for things like a late return, dirty boat, no-show, damage, refueling and rental reservation. Some larger companies provide the insurance. Others offer it through third-party companies.

Before hopping aboard

With peer-to-peer renting and the other options below, basic due diligence will prevent ugly surprises. Policies, fees and rules vary by company and sometimes by state. Ask questions before hopping aboard, including:

  • Will I need a license or proof I can handle a boat?
  • Do you provide training? If so, what does it cost?
  • Who pays for the gas? If I buy it through the company, what’s the price?
  • Who will I call if the engine breaks down or something goes wrong?
  • Does the rental fee include insurance for accidents and damage? If so, what’s the deductible and who pays it?

Time shares

You may have heard of time shares for vacation lodging. Some CEOs use them to share private jets.

For some vacation time-share owners, time shares have been a source of disappointment and regrets, as Stacy Johnson explains in this post.

Time shares are becoming ​available to boaters. BoatU.S. magazine says: 

In a time share, a fleet of boats is owned by a management company and the consumer purchases a specific block of time each year to use a specific vessel or a fleet of vessels. Time-share agreements usually last for one to five years.

Look for transparency

A search online for boating time shares turns up numerous companies and clubs. But few are transparent about how their deals are structured.

One exception is Spinnaker Sailing, a boat dealer, charter company and time-share operator in the San Francisco Bay area. Here’s how it describes its time-share membership program:​​

  • One person buys a new boat through the company.
  • A limited number of sailors share the craft’s expenses and access.
  • All can use the boat for an equal amount of time.
  • Monthly fees, covering insurance, marina fees, cleaning and repairs, may come to less than the cost of a day’s charter at a local sailing club.

A rental share in one of these high-performance sailboats, including insurance, maintenance and all the rest, costs from $295 to $1,295 a month, plus training fees and a deposit, Spinnaker president Drew Harper said in an interview. Owning a similar, 35-foot, $250,000 boat runs (after a $50,000 down payment) about $2,570 a month, including loan payments, slip fees, maintenance, insurance and other fees.

Approach time shares carefully:

  • Don’t join impulsively.
  • D​on’t sign a contract you don’t thoroughly understand.
  • Hire a lawyer to review any documents before you sign.
  • If you feel pressure from a salesperson or are presented an offer that’s good for one day only, back away from the company.

Boat clubs

Boat clubs offer access to a fleet of boats — often smaller ones — without ownership or long-term commitments.

Prices vary widely and depend on location and types of boats and services. Fees may be charged for sign-up, training, monthly maintenance and refundable security deposits.

Two examples:

  • The Rat Island Rowing and Sculling Club, in Port Townsend, Wash., charges $250 a year for unlimited use of rowing shells together with a crew.
  • Freedom Boat Club, with locations on the East Coast, Midwest, Texas Gulf Coast and California, has monthly fees ranging from $199 to $399. Additional sign-up fees start at $1,200, depending on the boats you’ll use.

Nonprofit small-craft clubs often offer training. They make rowing or sailing accessible and affordable. Ask at colleges, community centers and city or county recreation departments.

With any club, read contracts closely and make certain you understand all benefits, obligations and costs.

Charters

Boaters sometimes fantasize about hiring out their boats and retiring to a life on the water. But it’s not that easy. One former charter boat captain told BoatU.S. that he just broke even.

Says BoatU.S.:

Consult your tax adviser before putting your boat into charter. Federal tax laws apply when recreational boats are used commercially.

Prices for chartering range greatly, depending on the boat type and size and amenities included. Here are examples at the lower end:

Add a skipper, crew and meals — as many do when chartering — and, as you can imagine, the costs can grow and grow.

For referrals to trustworthy charter captains and companies, try local yacht clubs, marine supply stores and bait-and-tackle shops. The American Sailing Association has links to charter companies in the U.S.

Do you have experiences to share with us about peer-to-peer renting and other options described here? Post a comment below or on our Facebook page.

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Comments & discussion

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  • James Hazelton

    Some other ways of boating without buying a boat:
    Network to find boaters with common interests such as fishing or sailing or even resort to putting a note on a public marina bulletin board. Owners frequently need experienced help that wives or kids refuse to provide after the first chaotic outing beyond sunning or swimming. I’m a sailor who also enjoys fishing. If I’m invited to fish, I bring my own tackle and I’m perfectly willing to share expenses; gas, bait, ice, food and drink. On our return to the dock, I’ll clean the catch and help clean the boat. Then thank my Captain/owner and don’t concern myself with docking fees, insurance, boat payments or regular or sometimes catastrophic maintenance or buying seemingly endless must have ‘add-ons’.
    Sailors who own large sailboats or ‘yachts’ have the problem of finding enough experienced crew necessary to leave the dock or tie up safely or certainly to run the boat for a trip as long as or as short as a day sail or long weekend. Cruising for longer periods is even more problematical. Here anyone with some experience goes ‘free’ in return for helping to move the boat in the direction the owner wants to go; following a course without running aground or hitting another boat, working sails and perhaps even cooking.
    I’ve often been asked, “Why don’t you buy a boat?”
    I always answer, “Not while you already own one!”

  • sam

    Join the Navy