Jon and I have always tried to avoid debt, and believed that the purpose of money is to have opportunities. While cruising in the 1980's we proved to ourselves we could be frugal and live on a very limited income while still having fun. Back then, we cruised very comfortably on US$10-12,000/year. Even while raising our children in the classic "suburban life" ashore we managed to live below our means, and to save and invest the balance. When our family decided to go cruising we knew that together with investments, savings, and income from renting the house, we'd have the financial freedom to take off for a few years. Every family has to cruise within their own budget, whether that allows them to stay out one year or ten. But we would advise that the boat (and other assets) be paid off. It's difficult enough to manage complex finances from overseas, and it's silly to be paying interest when you have little or no income.
We don't really have a "budget" per se, that we try to stay within. However, several people have asked us how much it costs to go cruising. This is actually difficult to determine, as the first year was full of one-time expenses to get the boat setup the way we wanted it.
We think we put about $40,000 into converting this former-charter cat into a cruising cat (all prices here are in US$). The big ticket items were a new inflatable dinghy and 25hp outboard (5K), new sails (9K), Spectra watermaker (5K), and 4 solar panels (3,500). The added structural aft braces for the dinghy davits and bow pulpits and seats came to 1,500, custom manufactured in St. Martin for us. We also added radar (2K), as well as HAM radio, Pactor modem, Sat phone, storm anchor, tools, and EPIRB (all about $1,000 each, an amount now known as a Boat Buck or BB), new VHF, upgraded GPS, etc., etc. Engine spares can (and probably should) be a chunk up front, but hopefully not much of a running expense. Note that Jon does almost ALL his own work, or swaps time with an experienced cruiser, so there are no labor charges in any of this. Labor charges can add quite a bit, depending on where you are.
Now that most of that is behind us, we can see our monthly expenses a bit more clearly. We have no real budget, spending what we must when we have to. We think we spend about $3,000/month or $36,000/year for the 4 of us, which is cheap next to land-based life, but may be hard to generate from investments only. If we were to figure expenses for just 2 of us aboard, the total would drop to about 23,500, (not 18K, or half) due to fairly fixed costs on boat maintenance, boat insurance, navigation/legalities, and communication.
|Food||US$ 600||US$ 7,000||19|
|Trips back to the US||3,000||8|
|Totals||$ 3,000||$ 36,000||100%|
Food: We seem to spend about the same as we do at home - i.e., about $100-150/week (or about $7K/year) for us 4 on average. This is actually difficult to track, as we try to stock up where stuff is cheap (South America), then live on "boat food" and only buy fresh produce in places like French Polynesia. Teenagers eat a lot. We try to eat what the locals eat - if you want steaks every night, food costs go WAY up. We tried to stock up on cheap beer and Caribbean rum, but of course storage space limits the quantities. Ditto for wine: boxed Chilean was a reasonable value in Panama until we can get to the good OZ and Kiwi wines. These prices go up when we have friends on board as we tend to eat not only more, but better when we eat with others.
Boat Maintenance: This is a hard one to figure, and higher than we thought. Replacing the headstay in Tahiti was a BB (Boat Buck = $1000), as were the (overpriced) sail repairs at the same time. Our engine repairs in Tonga were 1BB and repairs to the Profurl headsail roller gear were another BB. In Panama we had to get a new autopilot for 3BB, and another BB for new anchor chain. Hauling Ocelot in Venezuela and painting the bottom came to about $500. The basic haul-out in Tonga was about the same, but the paint is much more expensive ($100/gallon for 7 gallons), doubling the overall price. Our laptops (about 1BB each) seem to last about 1-2 years before this environment rots them, especially the keyboards. Depreciation on the dinghy is probably $1,000/year, and the sails are probably the same but these numbers are not added into the above budget estimate. In other words, we'll have some high maintenance expenses as the boat and equipment get older. The more use the boat gets, the faster it wears out.
Medical: We have used International Medical Group in case of catastrophic illness. We pay about $400/child/year and about $1,300/adult, with a big deductible. It's only valid for people living outside the US. Canadian cruisers may not have to worry about this. All the medical care we've needed has been so inexpensive in the Third World that we've not even claimed on the insurance, but it does add up. Sue's back-work in Curacao came to $1,000 for X-rays, MRI, medications, and physical therapy. We've probably spent $1000/year on dental work here and there. When we went back to the US in the fall of 2003 we had insurance through Jon's work, but also paid out of pocket another couple thousand in medical care.
Boat Insurance: This is the biggest single item on the budget. Most cruisers pay about 1.5-1.8% of hull value on cruising insurance every year, with additions for passages, dinghies, and personal effects. We're currently paying $4,200/year.
Trips Back to the US: This is another big expense. We find that for mental health we need to get a family and friends fix every 1-2 years. It's not just the international flights that are high ($850/person from the Caribbean and French Polynesia, $1,500 from Fiji) but all the things we end up buying/doing while we're back there!
Entertainment: This is a widely variable expense among cruisers. Having very little earned income, we try to keep this pretty low, but we're also out here to experience life. In Third World countries there is not much to spend money on. We go to local fairs, markets, events. We rarely drink beer in bars, preferring to get together with cruising friends to create our own social events. We probably eat out once or twice a month, maybe more if the restaurants are cheap (like in Ecuador and Venezuela where meals and movies were about $2 each, or in Fiji where $4 gets you a great curry feed). We've splurged on things like 1BB for our Galapagos tour, $1,500 for our inland Venezuela excursion, and only $300 for inland Ecuador. In Tonga, whale watching and scuba diving are each about $40/person for a day's activity, and we've done each a few times. In addition, we may spend ~$100/island on tours or something similar. Again, these activities greatly increase when we have friends and family on board.
Local Transportation: For daily errands, we walk almost everywhere - it's great exercise. We carry day packs and load them up with food, often shopping for a few small things every few days. In the eastern Caribbean islands the local busses (vans, really, with very loud Reggae music) were about $1/person. In Venezuela the shops were miles apart but taxis were only $1.50/trip. In Tahiti we used Le Truck, $1.25/person to Papeete from the anchorage, but there were good stores within walking distance. Tonga was so small we had no transportation expenses. In Fiji, anchored outside Suva, we spent about $5 per day in and out of the city, sometimes more.
Fuel: Our 48hp Yanmar engines each burn 2-3 litres/hour and we add about 200 hours/year to each engine. That is probably low compared to other boats because we use solar energy to charge our batteries. Diesel prices have swung from $0.25/US gallon in Venezuela to over $2/gallon in French Polynesia at the duty free price. Diesel has probably averaged about $1.25/gal for our trip so far, but I'm expecting it to go up. Dinghy gas is about $10/week except in French Polynesia where we did lots of dinghy exploring and diving, and the gas was over $6/gallon. Cooking gas is about $25 every 6 weeks. Call it $1,500/year all up. Note that all of these numbers go up significantly when we have friends on board as we do much more moving, exploring, ferrying, and cooking.
Inland travel: (see also Entertainment, above): We often rent a car or a taxi for a day or two to explore a new island. We did this all throughout the Caribbean ($30-80) and once in Tahiti ($110). In Venezuela we flew to the Andes ($170/person), then stayed for 2 weeks because the meals and lodging were so cheap and wonderful (about $40/day total for the family). Our trip to Los Llanos was $35/person/day all inclusive (van, English speaking guide, lodging, food, and excursions - what a deal!). In Ecuador the buses came to $1/hour of riding, so we traveled for 5 days. Lodging and meals in all of South America were incredibly cheap. Tonga was so small we didn't rent a car. In Fiji, we rented a car for 2 days, at $50/day. To all excursions you have to add entrance fees and gas expenses. BTW, we use Lonely Planet guide books for all our destinations. They are invaluable.
We almost never go to marinas, preferring the solitude of anchoring. Marinas
are a bit like going camping at a KOA - who wants to live in the middle of a
busy parking lot? We even avoid moorings if we can, as we prefer to spend
our shore $ on better things. In Tonga, Jon did some work for The Moorings
charter company, and they let us use their moorings, as Neiafu harbor is too
deep for anchoring. In Fiji, moorings in Savusavu come to about $5/day. In the
Mamanuca Islands of western Fiji you pay the same in Musket Cove, but other resorts let us use
their moorings for free, assuming we'll buy drinks or dinner ashore. While
this may cost more than $5, we get something tangible for it, so we usually buy
some drinks now and then, which also leaves a "clean wake" for other cruisers
who may follow us.
Most clearance and port fees are fairly nominal and hardly show up: $45/month in Tonga, nothing in the French territories, perhaps $30/island in the Caribbean. Our Panama transit was about $650 plus a deposit of $850 which we got back. Extended visas - say, longer than 3 or 4 months - can begin to add up. To stay 6 months in Fr. Polynesia we spent $400 on visas, plus $200 on translation services required by the consulate in San Francisco. In Fiji, to stay over 6 months becomes so expensive most cruisers either fly or sail to Fotuna or back to Tonga then return to start the immigration clock again.
Almost everyone out here swaps electronic charts, but we insist on having paper as well. We used our 20-year-old charts in the Caribbean, and (legally) copied charts for the Pacific ($1.50 each in Panama) but originals are expensive. Up-to-date cruising guides for each region are a must as they tell about changes to ports that won't be shown on charts, recent changes in clearance policies, and great info on where to anchor, find good stores, etc. Some can be bought outside the specific cruising grounds, but it's better to pick them up before you get there. They cost about $25 to $50 each. Just about all our navigation includes all three media: electronic charts, paper charts, and cruising guides - they overlap a bit, but each provides essential information for us.
Souvenirs: This is another expense item that will vary greatly from one cruiser to another. We long ago decided that the best souvenirs are experiences and memories. Experiences include our inland trips, diving, car rentals to explore islands, and special things like our Galapagos or Venezuela tours. We save our memories on digital cameras, both above and under water. Despite the fact that we absolutely LOVE good slide film (and the slide shows that come afterwards) we experienced the expense, hassle, and potential for ruined film and lenses aboard a boat in the tropics on Oriental Lady. We are 100% digital now and loving it. We do pick up small souvenirs like baskets, small pieces of art work, jewelry, etc. Other cruisers go for big carvings, paintings, and things that might cost hundreds of dollars. The sky is the limit.
Communication: Most of the expense is in the equipment, outlined above. A 200 minute SIM card for the Satellite phone used to cost $360 and lasted us all year. As of 2005, this plan is no longer offered, and so we don't know what we'll do in future. In Tonga and Fiji we bought phone cards to place the occasionally needed calls home, for about $50 to $100 in each country.
Other: I'm sure we'll think of other stuff after we post this. In 2003 we spent 1BB on scuba certification for the family, and another 2BB on dive gear to have on Ocelot. High school tuition for Westbridge Academy is $1K/student/year, plus we spend hundreds on books (school and reference). It all adds up. I'm not sure we'll ever have a "typical" year!
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