Your Financial Planning Guide: How to Save to Buy a Boat

Boating is a booming industry. US boat sales reached a 13-year high in 2020, and the boating boom continued surging through 2021.

As more enthusiasts looked into buying boats, prices soared. If you’ve been planning to buy a boat for a while, you’ve probably noticed the rising costs. The pandemic fueled boat purchasing as people sought different recreational activities.

That’s great for the boating industry. However, the price changes present challenges for aspiring boat owners.

Higher demand for boats isn’t the only contributing factor to higher prices. Supply chain issues took a toll on inventory. When you buy a boat, it can take over a year to arrive.

Inflation has also contributed to higher boat prices. Higher prices of goods and services leave boat owners one of inflation’s many victims.

These obstacles present challenges to buying a boat. However, there is hope for aspiring boat owners. Financial planning can help you overcome obstacles and buy a boat that’s right for you.

Let’s discuss some of the strategies you can use to save money when buying a boat. We will focus on establishing criteria for your boat and preparing for your purchase.

 

Establish a Budget

Boats are expensive. If you do not buy a boat with proper financial planning, you can land deep into debt. Establishing a budget allows you to address this concern.

It’s critical to set a budget before you start searching for boats. A budget helps you avoid excessive spending.

It also helps you prioritize critical boat features and accessories. The cost of boat ownership does not conclude upon buying a boat.

Reviewing the average price of different boats helps you establish a realistic budget. To buy a boat, you may stretch out of your budget, but avoid stretching out too far. This practice will help you eliminate several boats from your list.

 

Determine the Type of Boat

Buying a boat requires an understanding of the different types of boats available. Some boats cost a little over $10,000 while others exceed $100,000.

Three of the most common boats are sailboats, powerboats, and human-powered boats. Powerboats move through the water quickly.

Sailboats allow riders to enjoy the sport of sailing. A human-powered boat gives you access to deeper parts of the ocean.

If you want to explore, consider the latter boat option. Knowing different boat types will help you make a better decision.

Ask yourself how you will use the boat. Knowing your lifestyle preferences will help you avoid overpaying for too many features. If you only want to fish, focus on buying a fishing boat.

This background information will eliminate boats with insufficient capabilities for your needs. Some boats may have too many features for your preferences.

 

Determine Your Boat’s Size Range

It’s no secret that bigger boats cost more money. A big boat provides more space for each passenger. These boats come with higher price tags in exchange for the extra space.

Buying a smaller boat costs less. However, crammed passengers won’t enjoy riding on a small boat. When buying a boat, strike the proper balance between price and size.

Most boat enthusiasts will recommend at least a 25-foot boat. This size provides sufficient space for offshore travelling adventures.

Many boat buyers aim for a width below 8.5 feet. Boats more than 9 feet wide require special permits to travel on public roads.

Obtaining special permits is challenging enough. However, driving on the road with these boats won’t be enjoyable.

Many boat buyers can get by with 25 feet by 8.5 feet. You can opt for something smaller or larger depending on your needs.

 

Boat Accessories

No person will only buy a boat. They also purchase boat accessories to enhance the experience. You can select from many boat accessories, but some are more important than others.

Sun coverage and air conditioning will make a hot day more enjoyable. Not carrying these accessories on a sweltering day can make the ride unenjoyable.

Many boat enthusiasts purchase a GPS for their boat. Boat owners can select from a handheld, portable, and dash-mounted GPS for their boats.

Some boat owners also invest in storage because they cannot fit their ride in their driveway. These boat owners look for a dock or storage facility near the shore and park their boat in the area.

Investing in a boat sound system will help you alert others of your presence. Some people buy an over-the-top boat sound system. These people want to ensure everyone knows of their presence.

When purchasing accessories, consider your other passengers. Some boat owners take a bathroom in the ocean. Other passengers may not feel comfortable relieving themselves in that manner.

You can invest in a bathroom for your boat. Having the bathroom also helps if you want to live in your boat.

Create a list of accessories you want in your boat. Identifying these expenses will assist with financial planning.

 

Browse Through Used Boats

Before you buy a boat, browse through used boats. These boats come already built and at lower prices.

If you don’t plan to ride your boat often, a used boat with high mileage is a great deal. Boat lifespans vary, but most boats last 10-25 years. Proper boat maintenance and light usage can extend your boat’s lifespan.

Buying a used boat can save you thousands of dollars. If you want to stick with the same budget, you can get more space and accessories.

 

Consider Wait Times

If you opt for a new boat, it will take longer to arrive. Supply chain issues can leave you waiting over a year before receiving your boat.

Not every boat enthusiast has that type of patience. You will miss at least one boating season. Depending on how long it takes to make the boat, you may miss two boating seasons.

You can minimize your wait time by purchasing a smaller boat or buying a used boat. Purchasing a less popular boat will also lower your wait time. If you need to save up extra funds to buy a boat, you can prolong your purchase.

 

Be Patient, but Pounce on Deals

Great deals will go quickly. However, if you rush to buy a boat, you can end up with a subpar boat. Browse through several boat listings to distinguish between a good and bad deal.

Once you find a great deal, pounce on it. Reach out to the owner and start the conversation. If you wait too long, someone else will buy the boat first.

Before buying a boat, hire an inspector. Inspectors check the boat to ensure it is safe. They will let you know of any concerns about the boat’s structure.

You can hunt for multiple boats at the same time. This strategy will give you backup plans in case you get outbid. Hire inspectors for each boat you consider purchasing.

 

Plan for Hidden Costs

When most people buy a boat, they only look at the boat price. However, boat ownership contains several hidden costs, such as boat maintenance.

Boat enthusiasts clean their boats once every two weeks. You can get away with fewer cleanings if you don’t use your boat often. If you use the boat more often, you may have to clean it 1-2 times per week.

Storage costs hundreds of dollars each month. Unless you have a large driveway, you will need to invest in storage.

Boat owners also need to invest in training. These training courses help boat owners obey laws and know how to operate their vessels.

Each state contains different rules on proper boat training. Review your state’s regulations before buying a boat. These training courses don’t come for free.

 

Build Up Your Cash Position

You can review various boats and establish criteria. These practices help with financial planning. However, you need additional funds to buy a boat.

Building up your cash position will help with buying a boat. You can get boat financing, but cash is king. Paying in cash can knock down the purchase price.

Track each expense to determine where you can cut costs. Keeping track of monthly costs in a spreadsheet will make your data easier to access. You can also review prior credit card statements to see how you spend your money.

Check each of your monthly subscriptions to see which ones you don’t need. Individual expenses won’t hurt you, but they can add up. Stay on top of them as you build up your cash position.

Tracking monthly expenses lets you see how you would manage boat ownership costs. This snapshot gives you a realistic look at your current financial situation.

If you want to raise funds quicker, consider throwing a side hustle into the mix. Working a few extra hours each day will make the boat feel more affordable.

Some people continue side hustling after making a big purchase. However, others stop side hustling after buying a boat.

 

Invest Spare Cash

Your money won’t do anything if it sits in the bank. Some aspiring boat owners will put their money to work. While saving up for a boat, these boat buyers will invest spare cash into various assets.

Investors can select from numerous assets such as stocks, real estate, and cryptocurrencies. Out of the three investing assets, real estate is the least liquid. Stocks and crypto allow you to receive funds if a great deal arrives quickly.

However, investing comes with risks. You can lose money by investing in assets. Some stocks and cryptocurrencies can significantly decline in value.

Not all aspiring boat owners can tolerate high-risk assets. However, they can still achieve returns through low-risk investments. Bonds and certificates of deposit fit this low-risk category.

While you won’t get a high return with these assets, you will make extra money. Investors with higher risk tolerance and timeframes may want to consider stocks.

If you invest $10,000 and get a 10% return, you’ll have an extra $1,000. Portfolio appreciation will increase your possibilities when buying a boat.

 

Build Your Credit Score

Some boat buyers need financing. They can put little or no money down to obtain the boat of their dreams.

Financing preserves funds you can use to cover accessories and other expenses. If you leverage boat financing, work on your credit score first.

Your credit score determines the interest rate on your boat loan. A higher credit score lowers the minimum down payment and interest rates. Lenders will turn you away if you do not have a high credit score.

Consumers with low credit scores turn towards risky loans such as payday and car title loans. A high credit score allows you to evade these scenarios and get better boat financing.

The simplest way to build your credit score is to pay your debts on time. Keep up with monthly loan payments.

If you have lingering credit card debt, pay it off quickly. Credit card debt comes with high-interest rates. Building your credit score will help with boat financing and your other obligations.

 

Buy a Boat with the Best

Many people aspire to buy a boat. They want to travel offshore and see more of the world.

Buying a boat is a significant decision due to its price. However, boat enthusiasts will tell you that buying a boat was a great decision.

If you want to buy a boat that fits your needs, we can help.

We offer boat financing that fits your needs. We also allow you to trade in your old boat to buy a new boat. Contact us today to see how we can help you buy a boat.