Saturday, July 23, 2011

What is the Real Cost of Boat Ownership versus Renting?

By Stephen Daniels


If your idea of the ideal vacation is water-skiing, fishing, or partying on the water, you may be thinking that purchasing boat would be a great investment. Before signing on the dotted line though, you should consider whether or not boat rentals might make more sense over the long haul.

Let's do the math: The typical cost of a new family outboard motor boat is in the $70-$80,000 range. Once you've thought about that a while, there are some additional costs that should be factored into your final expenditure such as state and federal taxes, dealer processing fees and interest on your loan. All this adds up to around $600 or so a month. Do you already own a car or truck that can transport your new boat, along with the trailer to transport it on - or will you need to buy or rent that equipment as well?

But wait - there's more! Think about:

Insurance

Maintenance

Depreciation (even higher than a new car!)

Transportation and storage (unless you are able to park it in your driveway or garage - or have a boat slip

Licensing for both the boat and the trailer

Safety items such as ropes, anchor, life jackets

Toys like wake-boards and water-skis, or scuba diving gear

The increased cost of gasoline to haul the boat wherever you are going. Your typical economy car isn't capable of transporting even a small boat.

Since the average watercraft owner actually uses their boat only 14 days a year, the average cost per day of use is around $692, or almost $10,000 per year. On the other hand, daily rental charges usually considerably less than this number - plus you skip the hassles of getting the boat to your vacation spot, storing it in the off-season, and dealing with a world of maintenance chores. Not only that, you're not tied to one type of boat. Think about it - you can investigate a fishing boat rental one day for you and your buddies and rent a gentle pontoon type vessel the next day that can accommodate family and friends for a picnic and laid back day of sunshine and swimming.

Often a day's fun on the water includes jet-skiing. Rather than jump into ownership, consider Jet Ski rentals. Styles vary significantly as to size, horsepower and safety features. Hiring one can save some costs, and also give you a an opportunity to try out a variety of models to see what works best for you and your family.

Now, if you either live on the water or own a vacation home on a lake or river and you're not in the habit of choosing a different vacation spot with each outing, then buying a boat or jet skis might make sense for you. The probability is you will use it considerably more than two weeks a year. Nevertheless, it still is practical to rent first to discover precisely what you want, and then possibly checking out some well maintained used boats before you commit yourself to a new one.

The answer to the question, should you rent or buy a boat depends on your vacation practices, your family and your finances. But perhaps the immediate answer is, "try before you buy" and rent several boats as part of your purchase research. After all, the majority of people don't trade in their boats every year for another model, so investing in a souped up Miami Vice type cigarette speed boat and then realizing what you really want or need is a 4-bed floating motel or a pontoon party boat could be a pricey mistake.

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