General Costs to Know Before Purchasing a Boat
If you are thinking of buying a boat, you may be wondering how much does a boat cost on average? The price of a boat depends on the type of boat you’re interested in, as well as its size, brand, condition, and features. A new boat averages about $42,000. However, for a more luxurious model, you can pay well over $100,000.
In addition to the cost of buying the boat, you should also factor in the boat maintenance cost and insurance, as well as yearly costs like taxes. How much does it cost to maintain a boat? In general, it’s a good idea to plan for a yearly maintenance cost that’s about 10 percent of the cost of the boat, depending on the type of boat and your maintenance practices.
Tax laws vary by state. In some states, you’ll pay a boat tax equal to a certain percentage of the boat’s assessed value.
How Much of a Boat Can You Afford?
First, figure out your budget. Then determine how often you’ll use the boat and what you’ll use it for. Will you mostly use the boat for fishing? Or do you intend to use it to travel? If you plan to use the boat frequently and/or use it to cruise from place to place, it may be worth it to you to spend more on it.
If you don’t have enough cash to cover the cost of buying the boat, you could finance the purchase. For instance, there are top personal loans available that you can use to help buy a boat.
One of the benefits of personal loans is that they can be used for virtually any purpose. Personal loans can even be used for boat repair financing.
Boat Maintenance Costs
An ongoing and significant expense of boat ownership is the boat maintenance cost. Boat insurance, fuel, a trailer, storage, licenses, and repair costs are all things you should factor into your budget.
Read on to learn the answer to the question, how much does it cost to maintain a boat?
Boat Insurance
Boat insurance is a requirement, and for smaller boats, it averages about $200 to $500 a year. If your boat is bigger, insurance will generally run 1 to 5 percent of the boat’s value. That means insurance for a $42,000 boat might range from $420 to $2,100.
Boat insurance prices vary depending on the type of boat, how old it is, the condition of the motor, the boat’s intended purpose, where you live, and your driving record.
Fuel
Fuel costs depend on what type of fuel your boat uses. Regular or premium gasoline fuel may be fine for smaller boats, but larger boats may need diesel fuel, which is more expensive.
Keep in mind that the faster you drive your boat, the more fuel it will use. Also, buying gas at certain marinas may cost more as well — 50% more, in some cases.
Trailer
If you’re taking your boat out of water for storage or transport, you’ll need a trailer. A boat trailer can cost anywhere from $500 to $10,000, depending on the size of your boat.
In addition, you’ll need to add in the cost of upkeep for the trailer, including the tires, brake repair fees, and regular upkeep fees.
Storage
You’ll probably need to pay for storage of the boat during the winter. You have a few storage options, including your garage or driveway, an outdoor storage facility, or an indoor storage facility.
Storing your boat in your garage or driveway is usually the cheapest option if you live in a single-family home. However, you’ll have to winterize the boat. You should also check to find out if there are any rules in your area about parking boats in driveways.
Outdoor marina storage is more expensive, but it offers convenience and security. Outdoor marina storage costs between $20 and $50 per foot of boat. However, your boat is still exposed to the elements. Again, you’ll need to winterize it.
Indoor storage is the most expensive option, and costs from $50 to $200 per foot. But you’ll have the peace of mind of knowing your boat is protected from the elements and secure.
Equipment, Accessories, and Toys
You’ll need boat equipment and accessories. This includes the necessary safety equipment like life jackets, a flotation device, horns, signal flares, and a medical kit. You’ll likely also want some fun toys and water sports equipment such as scuba equipment, snorkeling gear, or fishing equipment. Be sure to budget for these items.
Education and Licenses
The requirements to register your boat and become licensed to drive it vary by state. The cost involved usually depends on the type and size of your boat. You may need to pay for certification classes to operate the boat, a certification cost, and a yearly renewal cost.
On-Water Towing Fees and Emergency Fix Funds
If your boat breaks down while you’re out on the water, you could have to call for a towing company. Most water towing companies charge by the hour for travel to and from the port. It can be expensive.
Your boat may occasionally need emergency repairs. The boat could become damaged, especially if you store it outside, and equipment or parts may break and need replacing. For example, boat engines last about 1,500 hours. The cost of replacing a boat engine can range well into the thousands of dollars.
Finding a Boat Loan
If you don’t have the cash upfront to purchase the boat, you can apply for a loan to cover the cost. You could look into getting a boat loan or a personal loan for this.
A boat loan is actually a type of personal loan used to buy a boat. Many banks, credit unions and online lenders offer boat loans. With a boat loan or personal loan, you get a lump sum of money that you repay monthly over time with interest. Once you’re approved, you receive the money quickly, usually within several days.
If you’re buying a less expensive boat, you could use small personal loans to purchase the boat. Small personal loans typically range from $1,000 to $5,000. These loans could also help you cover the boat maintenance cost and boat repair financing.With personal loans and boat loans, the interest rate, terms, and how long can you finance a boat depends on factors like your income, your credit score, and the size of the loan.
The Takeaway
Owning a boat can be rewarding, but it’s also expensive. In addition to the cost of buying the boat, you should budget for maintenance costs, fuel, and equipment. And don’t forget the water toys! After all, owning a boat should be fun.
This article originally appeared on SoFi.com and was syndicated by MediaFeed.org.
Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.
Communication of SoFi Wealth LLC an SEC Registered Investment Advisor
SoFi isn’t recommending and is not affiliated with the brands or companies displayed. Brands displayed neither endorse or sponsor this article. Third party trademarks and service marks referenced are property of their respective owners.
Communication of SoFi Wealth LLC an SEC Registered Investment Adviser. Information about SoFi Wealth’s advisory operations, services, and fees is set forth in SoFi Wealth’s current Form ADV Part 2 (Brochure), a copy of which is available upon request and at www.adviserinfo.sec.gov. Liz Young is a Registered Representative of SoFi Securities and Investment Advisor Representative of SoFi Wealth. Her ADV 2B is available at www.sofi.com/legal/adv.
4 ways travel credit cards can really save you big on your next vacation
A travel credit card is a generic term that applies to a type of credit card that offers travel rewards. There are many different kinds of travel credit cards, and each one may offer a different array of rewards, benefits, and perks. Some travel credit cards might earn airline miles, while others offer hotel points.
Finding the right travel credit card for you will depend on your own specific spending and travel patterns.
Prykhodov/istockphoto
There are three main types of travel credit cards: airline cards, hotel cards, and cards that earn generic travel points.
Airline Travel Credit Cards
Many airlines offer one or more airline travel credit cards that earn credit card miles that you can use to fly with that specific airline. With each purchase, you can get that much closer to your next flight. Additionally, many airline travel credit cards offer perks like free checked bags, a way to earn elite status, or discounts on inflight purchases.
DepositPhotos.com
Another type of travel credit cards are hotel credit cards issued by major hotel chains including Hilton, Hyatt, and Marriott. Similar to their airline counterparts, hotel travel credit cards let you earn hotel points with each purchase that you can then use to stay with their chain. Many hotel travel credit cards also offer hotel-specific perks, like elite status, increased earnings from stays, or an annual free night certificate.
DepositPhotos.com
If you like traveling but don’t want to tie yourself to a specific airline or hotel chain, you can consider a more generic travel card. Some banks, including American Express, Chase, and Citi, offer travel credit cards that earn their own proprietary credit card points. You can then use these bank points for many different forms of travel.
DepositPhotos.com
There are a number of advantages to having a travel credit card. Here’s a closer look at these upsides.
Qualify For Significant Welcome Bonuses
Many travel credit cards offer welcome bonuses when you’re approved for the card and meet certain minimum spending criteria. For example, you might earn 60,000 airline miles after spending $2,000 on your card in the first three months.
These welcome bonuses can be worth hundreds if not thousands of dollars, and they can be a great way to boost your travel budget. That’s why it’s important to understand how a credit card works when you sign up and what requirements there are to make the most out of your card.
MStudioImages
If you love to travel, you’re likely to be excited about the possibility of earning airline miles or hotel points with each purchase. The miles and points that you earn while using your travel credit card can help fund your next vacation trip.
Depositphotos.com
Some travel credit cards offer different types of insurance that you might find valuable if you’re a frequent traveler. Some credit card travel insurance protects you if you are delayed or an airline loses your baggage. Other credit card insurance might cover you while renting a car, allowing you to decline the rental car company’s high-priced insurance offerings.
DepositPhotos.com
Perks like elite status, free checked bags, or an annual free night certificate are other potential benefits of having a travel credit card. If you’re traveling outside the country, you might also consider an international credit card that you can use while abroad.
RossHelen
While travel credit cards can come with many benefits, there are also some disadvantages you’ll want to keep in mind.
Limitations in Travel Choices
If you have an airline or hotel credit card, you will likely only earn airline miles or hotel points with that specific airline or hotel chain. This can limit where you can use your travel rewards. As one example, if you have a Delta Air Lines credit card, you won’t be able to use your miles if you want to fly United or Southwest.
Not as Flexible as Cash-Back Rewards
Earning airline miles and hotel points can seem fun and exciting, but it may not be the best way to maximize your earnings. You’ll want to carefully consider the benefits of credit card miles vs. cash back to decide which type of reward makes the most sense for you. You may find that you’re better off with a cashback credit card like the SoFi credit card.
Potential for Annual Fees
Some (but not all) travel credit cards come with annual fees. These annual fees may be waived for the first year as an incentive for you to sign up, but you’ll be on the hook to pay the fee each year you continue to have the card.
While it is possible to get more value from your travel credit card than the amount of the annual fee, you’ll want to make sure that’s the case for your situation. Otherwise, you’ll want to focus your search on no annual fee credit cards.
AaronAmat / iStock
Whether a travel credit card is worth it will depend quite a bit on your own specific financial and travel situation. There’s no denying that there are many people who have used travel credit cards to great effect, traveling around the world at a discounted rate thanks to miles and points. Others have signed up for travel cards and continue to pay annual fees, even though they aren’t traveling as often.
DepositPhotos.com
You do have other options you might think about if you’re not interested in a travel credit card.
If you’re intrigued by earning rewards with a specific brand but don’t travel often, you might consider a private label credit card. These types of cards can offer benefits at a specific store or retail establishment.
Another option could be a cash-back rewards credit card. This would allow you to earn cash as a reward, which you could use for travel or anything else that suits you.
DepositPhotos.com
Travel credit cards are a type of credit card that offers rewards, perks, and benefits for frequent travelers. You might earn airline miles, hotel points, or more generic bank points that you can use for a variety of different types of travel. While it is possible to use travel credit cards to rack up airline miles or other travel rewards, you’ll also want to keep an eye on any annual fees that you’re being charged.
Learn More:
This article originally appeared on SoFi.com and was syndicated by MediaFeed.org.
Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.
Communication of SoFi Wealth LLC an SEC Registered Investment Advisor
SoFi isn’t recommending and is not affiliated with the brands or companies displayed. Brands displayed neither endorse or sponsor this article. Third party trademarks and service marks referenced are property of their respective owners.
Communication of SoFi Wealth LLC an SEC Registered Investment Adviser. Information about SoFi Wealth’s advisory operations, services, and fees is set forth in SoFi Wealth’s current Form ADV Part 2 (Brochure), a copy of which is available upon request and at www.adviserinfo.sec.gov. Liz Young is a Registered Representative of SoFi Securities and Investment Advisor Representative of SoFi Wealth. Her ADV 2B is available at www.sofi.com/legal/adv.
DepositPhotos.com
DepositPhotos.com
Featured Image Credit: Popartic/istockphoto.
