From all of the resources we've been able to find, plus analyzing our own spending habits, we are budgeting $20,600 per year for the trip. This amount of money, short of a major catastrophe, will supply us enough funds for boat maintenance, food, clothing, education, and other life necessities and conveniences that we are accustomed to.
To arrive at our number, we took the per year average of what we have spent for living over the the past 3 years and subtracted out 2 components: our monthly rent payment and the boat acquisition cost. This average came out to around $14,000 USD. We then tacked on 40% (a nearly arbitrary number) to arrive at our $20,600 target.
Our family of 4 lives quite comfortably on $14,000 per year, or $1,166 per month, before housing costs. This figure is everything we spend to live our life: food, clothing, health care, gifts, entertainment, car stuff (insurance, maintenance, tags, gas), electricity, etc.
$20,600, per year, will enable us to sail around the world. If the journey takes 3 years, we are looking at $61,800 not including boat acquisition.
Here are some assumptions and notables you must consider when constructing your numbers:
- Our cost of living is based on Atlanta Georgia, USA figures. In most places around the world, we assume, it is cheaper to live. In some places, we assume, it is more expensive.
- We have zero debt.
- We assume that our lifestyle expectations on land will translate to the water. For example, we eat in a lot, we assume we will eat on the boat a lot.
- We assume that the upkeep costs for our 2 cars per year will apply in great measure to our boat (gas, maintenance, insurance, etc.).
- We assume that we will be able to fix most of the boat issues we will face ourselves.
- We will have our boat in super shape the first day of the voyage.
- We are assuming the amount of inflation we will face will be negligible over the years of our journey.
So, how much does it cost to sail around the world? In the end, it really depends upon you. Study your land behavior, and use that as your guide. We believe it is an error to assume everything is either cheaper, or more expensive, to live on the boat sailing around the world.
Our conjecture is that the cost to sail around the world will turn out to mirror your daily land life. If you eat and drink out a lot, own all brand name things, one up your neighbor, pay for services, etc. you will carry that with you and you will live accordingly. Should someone reading this think I'm implying otherwise, to be clear, there is nothing wrong with such a lifestyle. If it is you, then be you. If you want to move aboard a boat and sail around the world, you be you and budget accordingly.
In the final analysis, the most powerful message that this posting can give you is that financially, whatever it is your doing on land is what you will do on the water. This means, financially, it is simply a matter of choice to be on land or on the water.
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I couldn't agree more, the other day I said, " I never hear anyone saying I can't afford to live on land". You live on land according to your income. You chose a smaller place to live, cheaper food, less "eating out", lower insurance premiums, you spend less on communications, entertainment and education costs according to your income levels. If you make the lifestyle choice to move onto a boat you will adjust your living expenses to meet your income.
ReplyDeleteHaving 4 children myself (oldest currently in university and youngest in grade 3 level) education is by far my highest monthly expense. This is the only "Not-negotiable" (and most expensive) expense on my monthly budget as I do not want my children to suffer in the future because I decided to go in "pursuit of my dream". They will return to land life at some stage and they need a comparative education to succeed there.
Congrats on learning to live on a small income, I have no doubt that your expenses will remain relatively constant and your budget will be sufficient, for the following 3 years at least!
Planning is the hardest part of any successful journey!
@Lola: Thanks Lola! The adjustment to living on a small income has opened our eyes to so many things we wouldn't have seen otherwise. As we simplify, life feels easier and easier. It has been a super journey.
ReplyDeleteYou are right on about the land equivalent. You don't hear people say, "I can't afford to live on land!" Awesome point.
You live on land according to your means. The same applies to the boat and living aboard one. Your money priorities are really no different. In your case, as in ours, the children come first.
There are a lot of misconceptions about living on a boat from a financial perspective. The emails I receive and comments I get are proof. The mis-information, I believe, comes from a number of sources to include the boating industry (selling an image of exclusivity), the movie industry (all the romance with this "exotic" life), and people themselves. In the later case, many people want to live this life, but cannot bring themselves to doing it. A portion of these people rationalize it to themselves with "well, it is too expensive anyway." In reality, it is no different than on land.
Good luck on your journey Lola! We will see you out on the water!!