I spent 3 years writing about yachts, and owning one takes way more money than you think

Hillary Hoffower

Jul 27, 2018, 17:45 IST

I spent 3 years writing about yachts, and owning one takes way more money than you think

R_Pilguj/Shutterstock
Really, yachts are just floating money.

A yacht costs a lot more than the price its owner bought it for.
There are additional expenses, like yacht crew, dockage, fuel, and maintenance, that many people don't think about.
Even many yacht crew wouldn't own a superyacht if they could afford it because they're so much money and work.

If there's one thing I took away from spending three years writing for the yachting industry and attending the Monaco Yacht Show, it's that buying a superyacht is the absolute pinnacle of indulgence for the 1%.

You see, these behemoths of the sea cost a lot more than the price tag they come with thanks to the upkeep they require - it's a series of neverending expenses. There's what I like to call the Big Four that will easily wear down an owner's black AmEx: yacht crew, dockage, fuel, and maintenance, among a host of other eye-popping costs.

Just ask the crew who work on yachts.

I once spent a day running up and down the docks at the Fort Lauderdale International Boat Show asking crew one question: Would you buy a boat if you were rich? The answer, overwhelmingly, was no. Those that said yes were new to the industry - my guess is that they just didn't know better yet.

Because, really, yachts are just floating money.

Here's how much it really costs to own a superyacht, which is generally defined as a boat at least 80 feet in length.

Generally, yachts over 100 feet cost $1 million per 3.3 feet — and that's not counting costs for upkeep.

Some older yacht models around 80 feet may sell for six figures, but a superyacht will most likely set you back by at least a few million. An 84-foot yacht can cost $1.74 million, while a 295-foot yacht can cost $45 million.

But that's just the beginning — owners can expect to spend about 10% of the purchase price annually on operating and maintaining a yacht. That's $1 million a year for a $10 million superyacht, although it varies.

The bigger the boat, the more crew — and salaries — you need. A 130-foot boat with five crew members can cost $32,500 a month. Deckhands earn an average of $3,083 to $3,574 a month, depending on the boat size. Captains get paid more, earning an average of $7,750 to $19,961 a month.

Yachts in Florida's Broward County, a hub for for yachting, account for $3 billion yearly in wages and earnings, reported Kate Lardy of the Sun Sentinel, citing a survey by the Marine Industries Association of South Florida. That's not counting yachts based internationally.

And don't forget payment for dayworkers, who are hired temporarily for onboard services. A captain of a 178-foot yacht told Lardy he spent $14,255 on dayworkers during the yacht's two-month visit in Fort Lauderdale.

There are also other crew costs, like medical and liability insurance, training, and uniforms, the latter of which the captain told Lardy he spent $11,190 on over two months.

In the two-month span, the captain also spent $50,000 on provisioning for the upcoming charter season, including bounty for the yacht's wine cellar.

When owners aren't busy yachting in the Maldives or cruising to the Seychelles, they need a place to dock the boat — and fuel to get there. The captain also told Lardy he spent more than $100,000 on fuel and dockage during the two-month visit.

Fuel and docking can get even more expensive during an event like the Monaco Grand Prix.

Fuel can cost roughly $400,000 a year — and that's not just for the boat, but the toys that go along with it, like Jet Skis.

Dockage varies on how big the boat is and how desirable the marina is. An 80-foot boat can run $1,200 a month, while a bigger boat in a more coveted slip can cost as much as $6,000 monthly. A superyacht owner can expect to spend $350,000 on dockage a year.

Like many things, yachts get wear and tear — they require regular maintenance and repairs. Routine maintenance can cost roughly 2% of the boat value after the yacht's first year, and around 7.5% of the boat's value when the yacht is 10 years old.

The captain of the 178-foot yacht takes the yacht to Fort Lauderdale twice a year, where it always gets work done. In the two-month period, he spent $142,746 on repair and maintenance, which he told Lardy is "typical."

And regular maintenance doesn't include the cost for periodic refits. One owner told Superyacht News he refitted his 98-foot yacht for more than $1.1 million.

There's also insurance, which can cost roughly $240,000 a year, according to a report by Towergate Insurance.

And don't forget miscellaneous expenses, such as communications (like navigation and Satellite TV) and administration (mail and office supplies, to name a few). The captain told Lardy he spent more than $6,000 on admin costs during the two-month stay.

Overall, he spent $643,164 during his stay in Florida. That's nothing compared to the $1.5 million he anticipated to spend for the yacht's next stay in Fort Lauderdale, during which the yacht would undergo a condition inspection.

All of this doesn't count the cost of fun — superyacht owners love to throw soirees, especially during events and boat shows. During the Cannes Film Festival, Paul Allen traditionally throws a party on his yacht, Octopus, complete with guests like Kate Moss and Jake Gyllenhaal.

With superyacht parties, you can usually count on costs for food (or hiring a celebrity chef), alcohol, a DJ, and décor.

Owners can recoup some of these expenses by chartering their yacht. A 205-foot yacht with a $3.5 million annual operating budget can charge $425,000 a week. The price can vary on season and yacht size and includes costs for food and drink, fuel, harbor fees and dockage, and delivery fees.

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