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My Escape Plan - Insights Wanted

14K views 89 replies 31 participants last post by  eric-the-red 
#1 ·
Hello everyone, new to the forum and excited to see all the great posts and information!

So, after 9 years I've decided living 8 hours a day in a cubicle just isn't cutting it and I think I've stashed away enough money that I might be able to buy a boat, head south and self sustain for quite a while.

I want to lay out my plan and hear from those of you with actual experience living this life what I may be missing. so please feel free to give your insights on my thinking around boat, destination, route, financials, or any other areas I'm maybe missing something.

Background: single guy, 40ish, no kids, raised sailing/racing a 35 footer on Lake Erie, 7 years in the Coast Guard, lived on my 37-foot Islander in Hawaii 2 years and a 35 Cruisers power boat for 2 years in North Carolina. Currently don't have a boat and live in Pacific Northwest.

The Finances:

Since I need the prep time in a number of areas, I'm giving myself 11 months to prepare.

I'll be selling everything - house, car, motorcycles, etc and if I wait to leave after our annual bonuses in Sept, I'll have just over $300k in various accounts, including 401k.

I plan to spend about $50-60k on a boat and $25-30k outfitting it. I'm thinking I'd buy it outright to avoid need to carry insurance. Currently liking the 80's Moody 37 or 376s. Seem well-built, comfortable cruiser with decent speed/sailing manners and a solid reputation.

That'll leave me about $200k in the bank. I'm thinking at 5% returns, I'm bringing in $10k a year. While I know you can spend a fortune cruising, I'd like to stick to a $500/month living budget = $6k year. Is that realistic?

I'm also thinking about $4k/year maintenance/repair budget.

So $10k a year incoming and $10k a year in expenses and I wouldn't have to touch my principle balance. This makes me think I can be pretty self-sustaining for quite a long time without having to work. But maybe I'm deluding myself. Is this a realistic budget for a 37-foot boat?

Insurance is a major concern. I'm thinking I won't get it on the boat, and I'm not sure about getting it for myself. I'm pretty healthy and don't typically need doctors. Do most cruisers have health insurance? How does that work in Mexico/Bahamas/Caribbean? Seems like this expense alone could blow my budget. Maybe Obama care will help! Or maybe I don't get it?

Escape Plan:

Use the winter prepping myself - diesel repair, first aid, spanish, SSB and navigation classes. Plus reading books on cruising - good books I should get? Plus finding the right boat.

I'll sell the house, buy the boat and move aboard next spring.

Spend the spring and summer prepping the boat, testing and practicing and leave in late Sept/early Oct and head straight down the West Coast stopping in harbors along the way so I'm doing mostly day trips.

Probably start off with a friend helping me make the passages so I can have some extra safety margin as I acclimate to the boat and long sails. Ideally hook up and shadow some other cruisers along the way so I can learn from more experienced sailors too. Is there an annual southern migration from the PNW I could join?

Goal is to get down to Mexico by end of October and then spend the next year or so cruising the Baja Peninsula & Gulf of Cali.

Then thru the Panama Canal and cruise Caribbean for a year or so.

Then probably a major haul out and head to Europe/The Med.

So, that's the plan so far. What do you think?
 
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#3 ·
If I had that financial set up no one would ever hear from me again. I've done it a long long time on not nearly a fraction of what you have. Never had insurance on my boat and only recently have health insurance, I still get my dental done in Honduras because it' cheaper than my deductable.Go for it!
 
#4 ·
That'll leave me about $200k in the bank. I'm thinking at 5% returns, I'm bringing in $10k a year.
Where do you get 5% from? I like the plan but you are not going to get more than about 1.5% on any "safe" investment. You might find an introductory rate a bit higher but even then, not 5%. The only way you might realize 5% will be by accepting some risk and actively manage your money and, if you have the skills and the risk tolerance to do that, think about the mechanism(s) you will use to keep track/trade from a boat. Or think of what else you can do along the way to make some extra money.

Good Luck to you!

BTW, if you have a safe way to make 5%, I'd REALLY like to know.
 
#65 ·
Who do you bank with?? You might want to shop around some. Just saying. this is my rate of return in a low to Mod investment 401-k nothing risky. Its not earning as well as mi wifes.

3 Months-- YTD-- 1 Year --3 Years --5 Years--- 10
3.89% --11.38% --9.20% ---9.84% ----2.10% -- 5.47%
 
#5 ·
Also , look into penalties for early withdrawal from your 401k. I'm not a tax expert by 10% + income tax comes to mind.

If you have someone local who can help out, look at the numbers for renting out your house - still not risk free though!!
 
#9 ·
Also , look into penalties for early withdrawal from your 401k. I'm not a tax expert by 10% + income tax comes to mind.

If you have someone local who can help out, look at the numbers for renting out your house - still not risk free though!!
I'm looking into rolling the 401k into an IRA, so it wouldn't be a savings account, it'd be a managed portfolio of stocks and bonds. 5% seems reasonable, and yes, i get there are risks, but long-term the stock market has always gone up. I have a money manager who would run the account, and I'm planning to meet with him to discuss rolling it over in the coming week. I get that there may be taxes and penalties. Hoping to do this over years so that I might minimize penalties as I could maybe claim hardship and my "income" is taxed at a very low rate or no rate.

In terms of "escaping" and not living my current life right...that's not really the case. I've actually got a great life, lots of friends, and a job that I enjoy. But ever since I was a wee lad, I've dreamt about sailing and exploring the world. I know there's more out there for me. And my passion for exploring and being free is much greater than my passion for work and a "regular" life. Life is short and I want to do this while I'm still physically capable and adventurous-minded enough to pull it off.

To be honest, I feel like the world has only so many "good" years left before some massive changes start coming down the pike.

And I know I only have maybe 10-20 years to do this, if I'm lucky. No disrespect to those older than that - it's awesome to be 70+ and cruising, but I'm not going to trust my dream to the dicey odds of being physically and mentally fit into my 60s and 70's.

I'll accept having less luxurious elder years with amazing memories of my 40's and 50's, rather than getting to 60 and thinking I spent 20 years in cubeland when i could have been exploring the world.
 
#6 ·
I was about to raise the same question. Ok down here getting 5% is doable on bank deposits but getting harder to achieve. In the US with interest rates much lower than in Oz I'd have thought 5% would be a fantasy unless you ran a very stocks and shares portfolio but that to me doesn't fit in with getting away from it all.
 
#7 ·
I don't intend to criticize here but I've been thru this too. If you feel the need to escape, you are living your life wrong. You need to be doing something about which you are passionate so it become less a matter of escape as simply needing a short change of scenary.
Unfortunately, figuring out how to make money doing what you are passionate about is difficult but attempting to find such might be less complicated than what you are planning. I found my passion by pure luck, becoming unemployed.
 
#10 ·
Hello everyone, new to the forum and excited to see all the great posts and information!

So, after 9 years I've decided living 8 hours a day in a cubicle just isn't cutting it and I think I've stashed away enough money that I might be able to buy a boat, head south and self sustain for quite a while.

I want to lay out my plan and hear from those of you with actual experience living this life what I may be missing. so please feel free to give your insights on my thinking around boat, destination, route, financials, or any other areas I'm maybe missing something.

Background: single guy, 40ish, no kids, raised sailing/racing a 35 footer on Lake Erie, 7 years in the Coast Guard, lived on my 37-foot Islander in Hawaii 2 years and a 35 Cruisers power boat for 2 years in North Carolina. Currently don't have a boat and live in Pacific Northwest.

The Finances:

Since I need the prep time in a number of areas, I'm giving myself 11 months to prepare.

I'll be selling everything - house, car, motorcycles, etc and if I wait to leave after our annual bonuses in Sept, I'll have just over $300k in various accounts, including 401k.

I plan to spend about $50-60k on a boat and $25-30k outfitting it. I'm thinking I'd buy it outright to avoid need to carry insurance. Currently liking the 80's Moody 37 or 376s. Seem well-built, comfortable cruiser with decent speed/sailing manners and a solid reputation.

That'll leave me about $200k in the bank. I'm thinking at 5% returns, I'm bringing in $10k a year. While I know you can spend a fortune cruising, I'd like to stick to a $500/month living budget = $6k year. Is that realistic?

I'm also thinking about $4k/year maintenance/repair budget.

So $10k a year incoming and $10k a year in expenses and I wouldn't have to touch my principle balance. This makes me think I can be pretty self-sustaining for quite a long time without having to work. But maybe I'm deluding myself. Is this a realistic budget for a 37-foot boat?

Insurance is a major concern. I'm thinking I won't get it on the boat, and I'm not sure about getting it for myself. I'm pretty healthy and don't typically need doctors. Do most cruisers have health insurance? How does that work in Mexico/Bahamas/Caribbean? Seems like this expense alone could blow my budget. Maybe Obama care will help! Or maybe I don't get it?

Escape Plan:

Use the winter prepping myself - diesel repair, first aid, spanish, SSB and navigation classes. Plus reading books on cruising - good books I should get? Plus finding the right boat.

I'll sell the house, buy the boat and move aboard next spring.

Spend the spring and summer prepping the boat, testing and practicing and leave in late Sept/early Oct and head straight down the West Coast stopping in harbors along the way so I'm doing mostly day trips.

Probably start off with a friend helping me make the passages so I can have some extra safety margin as I acclimate to the boat and long sails. Ideally hook up and shadow some other cruisers along the way so I can learn from more experienced sailors too. Is there an annual southern migration from the PNW I could join?

Goal is to get down to Mexico by end of October and then spend the next year or so cruising the Baja Peninsula & Gulf of Cali.

Then thru the Panama Canal and cruise Caribbean for a year or so.

Then probably a major haul out and head to Europe/The Med.

So, that's the plan so far. What do you think?
I think that you have the right idea, I really don't know what cruising costs are but I am planning for it right now. I think you are setting too much aside for a boat and refitting/outfitting. Many many capable cruisers out there for much less.

Good luck on your decisions and travels!
 
#11 ·
I wish you well; Seriously. Just be careful. Although easier now than it used to be, it is still difficult to try to deal with financial matters from the other side of the world. If you have someone you REALLY, REALLY trust, consider leaving them with Power of Attorney.
 
#12 · (Edited)
On a gut feel basis, I'd say your budget is light. Living on $500 a month means you're basically living in poverty...perhaps with a view. Also, dont forget to budget in regulatory fees and such. Entry/exit, visas, registration, etc.

Also, without insurance, you can likely forget about staying at a marina as a minimum of liability insurance is usually required to stay for any duration of time.

Can you save up another $100k and then go? $15k a year seems like its a lot more doable than $10k a year. Also, 5% return on AVERAGE means you'll have years where you'll lose money. If you lose money early in your investing cycle...your LONG TERM real returns will dramatically be lower.

Now, that being said...why do you need to preserve principal? If you're able to get 5% return and then also extract from the kitty, sure you may not have much at the end of your cruise, but you can work for the rest of your life!

Here's a couple that did it and their costs:

http://www.bumfuzzle.com/pages/Main Pages/Cost.php

I'm a big fan of the way they did it...but you can see that they had some means.
 
#15 ·
I did much the same thing when I was 43. best decision I ever made. 7 wonderful years before I went back to work.

Couple of thoughts.

The miles from Panama to the Eastern Caribbean will not be fun.

Refitting in Florida might be a better option. Stuff is generaly more expensive as soon as you leave the USA. There are exceptions though GRP work and paintwork is cheaper in Trinidad.
 
#16 ·
The purchase budget on a Moody 376 seems tight. I tried to get one that I felt would cost $100k after purchase and basic refit (not including all the outfitting I felt I needed) but it wasn't going to happen. There aren't that many on this side of the pond and while they aren't well known over here, people still want a higher price for them. If you're considering looking at the ones on the east coast, I've seen them and would be happy to give you my impressions and experiences. There was one that sold for around 60k that I didn't get to see so it might be possible.

Glad someone else appreciates them too. If you're willing to go a little older, I did find a few Westerlys with similar layouts that were a little older and a little cheaper. None were close enough to see although I did check out a late 90s Oceanquest.

I haven't left yet, so I can't comment on cruising budget. It'll be a few years before we pull our cash together and head off. I would recommend The Voyagers Handbook for a thorough discussion of what you'll need to do and know.
 
#17 ·
Hey everyone, thanks for the great replies, thoughtful insights and links! Please keep them coming!

To answer some of the questions:

I could touch the principle, but every time I do it reduces my annual "income" and shortens how long I can get away with not working. Obviously I will do it when/if needed.

I could also work another year. And then another, and be 50 before I know it. Another year would basically see another $35-45k in savings, so that would still not get me to $15k/ year. Or I can go sooner and see how it goes. There's a slim chance I may wait an extra year anyway, it all depends on how well I pull off this last big project I'll be working on.

I'm certainly open to the occasional odd job to make ends meet. The concept of transporting boats or doing some chartering is very appealing, though I know I'll need a license to do so.

I'm not interested in living the life of a pauper w/ a great view, but I'm also not thinking I'll be tying up in a ton of marinas and eating at fancy restaurants. I like cooking and fishing.

As for the Moody's - yes, I'd be very interested to know what you've found on the east coast. I've seen them for about $80k and figured there's room to negotiate. I may also look at smaller, newer boats. But I do like the Moody's quite a bit.
 
#18 ·
All through the 90's and early 2000's I sailed between the Caribbean and key West. I would work a few months in Key West in bar or as a house painter, save, supply and back to the Caribbean. I've never been a pauper or poor. If you told me I could have 200 grand in the bank and bring in 15 grand year! sh!t, that's more than living large. Even on my pittance of an income I've been eating out and drinking in the clubs, traveling to inland destinations etc. You are more than financially ready to start the cruising life my man.
 
#19 ·
Eric,

Frankly if you thought you could live on $1,000 a month, and you probably can. It would be best to have about 1,500 a month from interest. This way your principle grows faster than inflation, and you can keep ahead of the curve. Alternatively just a little bit coming in each year from paid work can really help add back to the principle.

Just 1,000 a year in paid work is the equivalent of having an additional 20,000 invested (at 5%) if you can pick up enough piece work to make even 5,000 a year, that's like having an additional 100,000 in the bank. Which would allow your principle to grow faster than inflation (this is the real key).
 
#66 ·
Eric,

Frankly if you thought you could live on $1,000 a month, and you probably can. It would be best to have about 1,500 a month from interest. This way your principle grows faster than inflation, and you can keep ahead of the curve. Alternatively just a little bit coming in each year from paid work can really help add back to the principle.

Just 1,000 a year in paid work is the equivalent of having an additional 20,000 invested (at 5%) if you can pick up enough piece work to make even 5,000 a year, that's like having an additional 100,000 in the bank. Which would allow your principle to grow faster than inflation (this is the real key).
Great point
 
#20 ·
I doubt the refitting costs are too high if you want to get it right before you set off.

Whether that is really necessary is debateable, refitting as you go along may well work provided of course boat is basically sound to begin with. OTOH, if you need new standing and running plus new sails and a major engine overhaul then that budget starts to look sensible.

While I would be prepared to head off without comprehensive insurance no way would I go without third party property and public liability.
 
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#21 ·
First of all... I am 41, and doing it. Not my first time though. We had our kids aboard at 5 days old. We have known little else than the boat, though we have been through several. I need to start off with many disclaimers: we have cruised on and off for over a decade, owned fixed keels since circa mid 90's, and had the benefit of sailing on boats long before that.

Now, next disclaimer of sorts: Capt Aaron is one of a handful of posters on SN that I highly respect. I really like his advice. I find it typically right on target and he and I generally agree on most things. I really think it is a case of one who has made his dreams fit into his checkbook. BTW, Aaron, hope to meet you soon. We are Tortugas in a few weeks, and likely keys thereafter. You buy the first round!!!

THat being said, I could not live and cruise like Capt Aaron (CA) does. THis does not make my way right or my way wrong. It is a difference of opinion. That is all. I repect his opinion immensely... but I prefer refrigeration, a variety of meal, and what I consider a comfortable lifestyle for my family.

Your $500 would not even cover our food budget. We push clost to $800/month. Food in Florida is much more expensive than PNW. I know that because I just got back from there. My Pops keep his boat there. We spent considerable time there abd we love the people, but with the exception of housing, found it relatively cheap compared to FL. Just one of todays examples is that I went to Publix today ad got a great deal on a whole chicken for $1.89/lb where that same chicken in WA for sale is $.89-.99 lb. Double your food budget in the south.. with a big exception to be read shortly.

We had good friends that were going to sail out of Vancouver (CA), then south through Mexico, then the canal, then the carrib, etc. God love them, but they met the folks in the baja and never left after five years. But you will have a LOT of adjustment being from the PNW. THe heat is one thing. WHen the low is 85 at night, you better get used to it real quick. If you plan on outfitting in FL (which is a great idea), I can give you a LOT of advie. I love this state for the cruising (as does Capt Aarron), but many things have changed. Insurance is one. A decade ago, a cruiser could get away without insurance. However, any marina that I would stay at anymore requires insurance. In the islands down south... I have no experience. But most of the US marinas now require insurance... and they require you listing them on the policy. Just a warning!

In Florida, we pay between 10/ft - 20/ft for a month.

My maint bill realistically runs $150/month. I can give you a better idea if I add it up, just pulling this off my head.

My insurance, $225k incl. Bahamas is $2700/year. You can get less... or you may pay more. A friend of ours had his similar policy dropped and Boatus wanted roughly $5000/year for the same (actually less) coverage. We have never had a claim and I have over 15 years with them.

THe marinas are great. You meet some incredibly well traveled people and it is a great camraderie. There is no way I could anchor out 24-7 like others do. I enjoy camraderie and dock partys, group destinations, internet access, access to h2o and elec, groceries, pumpouts, etc. Remember, in the gulf, you are 3 miles out to pump out (though I think they havre changed this to 12 nm... whatever). So the thought of just anchoring off an island and enjoying its benefits without any negatives are not legal unless your holding tank can accomodate a good bit. We go through 45g holding in about a week if we are really conservative. Now you can jump pump it out into the bay, but that is another discussion.

We try to spend a good portion of our time anchored out. We love living off the anchor. I put in 4-kyocera 130 watt panels and 4 4d lifeline batteries for 840ish amp hours on the batts and a realistic 200 ah/day on the solar. Many days it is less. Your budget for elec will run a solid 100ah/day unless you are a minimlaist. Realistic is 150-180 ah/day. How are you going to generate that? I have over $7000 in my solar arrays (the best investment I have made). A diesel generator like mine (Mastervolt 3.5) sips the fuel at .25/gallon.hour. However, it is 15k installed. You can go with a Honda, but the fuel will eat you up over time. I can get you exacts as that is what most cruisers here use, reluctanty. They often found that the cost of running it equaled out very close to a marina and ended up going there.

My bottom line is that I can give you exacts on what we cruise on, but rememebr we have two kids on board. Our cruising local is FL and Bahamas. Carrib is coming up if we dont do the East coast hitory tour first. My numbers and yours are very different.

ALl that said, you can do it and I think you should leave sooner than later. It is a wonderful life. You will finally be a part of a community, something many Americans have lost sight of. My best friends I meet on the water. They are incredible people and will do anything for you. Land based, it is a wonder if you even know your neighbors. And when you get tired of your backyard, you can change it at a moments notice. It is wonderful. Words cannot define how great it is.

Brian

PS September is really pushing the departure date to head out of the PNW. Get your boat south or in FL.
 
#22 ·
CD, I'll keep an eye out for you. I'll buy the first couple of round's. I'm thinking Dante's, pool w/ waterfall for the kids and umbrella tables with service for the big kid's and close to the dingy dock.
Insurance, it's true I got away with it for over 20 years, but will probably buy some sort of minimal package this year (reluctantly) as I know insurance company's generally find a loop hole to not pay anyway's. At 41 and 3/4's I am now becoming a more responsable citizen ( reluctantly). as a singlehandling dude, who finds comfort in dim light, soft jazz music a good book and a bottle of rum, and as long as the rain is only falling on my feet and not dripping on my head, I am as cozy as can be. the amount of electricity I don't use would astound most cruisers. The freedom I have due to the lack of need's has been the foundation of my ability to live the life for so long. This bare bones type of adventure cruising is not for every body. I feel guilty, like I'm betraying myself when I get on the cumfy gadget yacht's that I deliver, that's just me. I think Eric the Red, (ETR) will find a nice balance and seem's to have all the right finances, training, and attitude to be quite successful as a liveaboard cruiser. best of luck to you man.
 
#27 ·
Cant wait to meet you. There are actually several cruisers I look forward to meeting. Do love St Pete though. Ever been here? Wow... I was wrong to miss it for so many years. Great, great people, lots to do, most everything is bikeable, reasonable costs, etc.

We are in te Tortugas Nov 26-1st week of December. If youa re free and open for a sail, look for Sea Mist IV. You come, I buy the first round! Well go snorkel the windjammer together.

BTW, your attitude is exactly what I love. Does it all work for me? No. So what!?? It works for you and that is all that matters. It is also great for other cruisers or would-be cruisers to hear it. Some will be more like you, some more like me, and some off what I consider the deep end (lots of money and never leave the docks). I see them all. You do too.

Take care CA! Look forward to meeting you.

Brian
 
#23 ·
Thanks Brian and Aaron! And thanks Christina for the long and informative email about the East Coast Moody's.

Since I'll just be supporting myself and the boat (at first anyway, never know who might end up joining), I'm assuming I can cut the numbers Brian spends by at least 2/3 since he's got 4 people (figuring in some economies of scale on his side).

It's those monthly fees that turn into the real deal killers, and insurance is looking to be an issue. $5000 a year is literally half my budget! For what amounts to nothing but the protection of some weak words on paper that apparently I'll need to get into a marina? Do I need that just to moore up overnight or is that more of a long-term thing?

Will have to check into that more closely. This could really push me to working & saving a couple more years, depleting savings and expecting to need to go back to work after a few years, or needing to work while I cruise, which isn't exactly part of my current dream, but I suppose sacrifices must be made. That comment about how earning just a few grand working is the equivalent of mass quantities of saved money was an interesting one.

Clearly I need to put some more thought into how I can generate cash. I know I could rent my house, but that would add risk and take some of the interest earnings away as well.

I speak w/ my financial advisor tomorrow, and I may find tapping my 401k will be a big hit to my numbers too.
 
#28 ·
Thanks Brian and Aaron! And thanks Christina for the long and informative email about the East Coast Moody's.

Since I'll just be supporting myself and the boat (at first anyway, never know who might end up joining), I'm assuming I can cut the numbers Brian spends by at least 2/3 since he's got 4 people (figuring in some economies of scale on his side).

It's those monthly fees that turn into the real deal killers, and insurance is looking to be an issue. $5000 a year is literally half my budget! For what amounts to nothing but the protection of some weak words on paper that apparently I'll need to get into a marina? Do I need that just to moore up overnight or is that more of a long-term thing?

Will have to check into that more closely. This could really push me to working & saving a couple more years, depleting savings and expecting to need to go back to work after a few years, or needing to work while I cruise, which isn't exactly part of my current dream, but I suppose sacrifices must be made. That comment about how earning just a few grand working is the equivalent of mass quantities of saved money was an interesting one.

Clearly I need to put some more thought into how I can generate cash. I know I could rent my house, but that would add risk and take some of the interest earnings away as well.

I speak w/ my financial advisor tomorrow, and I may find tapping my 401k will be a big hit to my numbers too.
If you cruise like I do, you will not cut your numbers by 2/3. That is just food. THe only other exception is Live Aboard fees. If you sign a L/T contract (non-transient), they generally hit you for $50 the first person, then $25 each person thereafter. That is per month. THis is more prevalant down south (Ft. Myers Beach and Keys) than further north. In Pensacola they couldn't give a crap and it was a lot cheaper. But up north, you get a "winter" (not to be confused with a real "winter"... snicker).

ANyways, the killers are the insurance. However, My boat values at 225ish (maybe 250, I cannot remember exact). So, you could see your insurance costs less. However, the couple I am quoting was for a trawler of 125-150 value. They were Canadian, so maybe that effected it? Also, was a trawler. However, they were very experienced boaters.

Now, some good news. We are also part owners (my pops boat) of a Tayana 42 Vancouver. Insurance coverage is 150kish. He pays 1400ish/year for PNW. Because I have been patron with BoatUS, they wrote him under me (and since I own part of boat... so yours might be more). However, the point is that the cost for PNW is quite a bit less than down south. I do not know your rates in Mexico or S Ca. Other might help. However, even in the PNW (Olympia - Swanstown Marina), he had to provide insurance. I think the days of avoiding insurance are coming to an end in the US unless you really anchor out all the time. Was not that way IIRC 10 years ago. They couldn't care less. Problem with the PNW is that you really only get about 4-5 months max for sailing unless you are a harbor seal. Even they head south for the winter. Also, when you get to the Baha, there simply isn't a lot to spend money on. Food (if you will buy it) is reasonable. People are super friendly. This last part is hear-say from friends of ours that spent 5 years there.

What is going to kill your budget is the marinas and breakage. They go about hand-in-hand. Major breakage is a marina or a yard. For example, our neighbor across the slip had to replace his lifelines on a Crealok 37. THey were aluminum and he changed to SS. That was $5,000. Would have been a month in the yard too. Just one of those will screw your budget for the year.

The trick to all of this is learning to do things yourself. Aaron has mastered that, but has grown up with it. Those that have not have a steep learning curve. Yeah, any moron can duct tape something together, but when you get offshore, that is when your duct tape will be tested - not the marina. SO learn to do things right, the first time. THere is a reason sailors do things the way they do and have done for hundreds of hears. The newer boats have a lot more systems and things to break, but the lesson is the same: Learn your boat and your systems yourself. Money has less to do with it than the reality that in some places, it is only you to fix it.

Now you may be thinking a lot of negatives. I hope I have not provided them. I am giving you my perspective on things. THere are a million things to learn about being a Mobile Live Aboard. That is what we all are. But I wake up to the sea and gorgeous sunrises. I am with my kids all day. I am in an atmosphere of people that will do anything for you. I have control over my own life. It really is what you are talking about - a great life and wonderful reminder of what living is all about. The only real caution is that once you come here, it is hard to ever go back to where you left.

Let me know if I can help with anything.

Brian
 
#24 · (Edited)
For Eric:

I think you are probably fine on the $10k per year. It's not a lot. Many are on three times that amount and quite impoverished.
But if you stay in Mexico and the Caribbean it's fine. Good life and can be cheap.

I doubt you'd need $30 k to outfit a boat. Whadda ya gunna do? Put a jacuzzi on it? You would be better IMHO to pay more for a fully fledged boat... The $70k mark is good to get a vastly more modern boat... Maybe ex charter from the Carib. Start there, perhaps.

If your idea is to escape and doodle about the coast doing overnighters and gunk holing for 5 to 10 years in South America and the Caribbean you do not have to outfit for ocean passages.

I agree you don't need insurance. You wouldn't get it for solo sailing anyway.
Medical insurance is the same. As soon as you are out of the USA medical prices plummet. I got a sun cancer cut out of my back in St Martin by a proper surgeon for the price of a consultation in the USA. And if you really get sick you go to panama or Cuba, lots of cheap, GOOD, places.

The only drawbacks to your plan is its no escape. If you are running away from life you will fail as life is all around. If you are rushing to "find yourself" you can do that at home.
Also as a 40 year old intelligent, single person, you may find cruising in a sea of old people, with little mental stimulation, to be BOOOOOORING after a few years.

So make sure you have a plan (that bulltwaddle: " we have no plan and are sticking to it" is a recipe for dementia.) that's going to challange you and your intellect. It could be history, geography, whatever, but it must be something.


Mark
 
#25 · (Edited)
CruisingDad hit the nail on the head with his last comment about buying the boat in South Fla. We have a surplus of seaworthy used boats selling for a song. Don't get all caught up on a specific boat brand, rather look for a specific design. Blue water, reasonable draft,5 feetish or so. And the Caribbean is our back yard. It's true marinas in Fla. generally want insurance, but not down south. Liability is kind of an American thing. Mexicans don't sue eachother like we due. Central and south Americans shrug their shoulders at disaster and move on. Anchor out anyway's and you won't need the insurance, don't let that be a deal breaker dude.
 
#26 · (Edited)
One more comment. $5000 a year for insurance is *RIDICULOUS*...that amount is likely for an agreed value yacht insurance policy with a low deductible. I have a $126k agreed value policy with liability/indemnity for *FLORIDA* with navigation up to the Northeast and out to the Turks/Caicos and it costs me $1700 a year for a 34-35' sailboat docked behind my house. Older boats, of course, will pay more...but then you dont need a full agreed value policy on an old boat because they're just not worth that much and you're better of "self insuring".

For you, who would likely just get indemnity/liability coverage in case you hit someone, or you case some kind of environmental disaster with your fuel spill. Liability insurance with a good umbrella policy of $1MM should be much much much less. I got a quote for a umbrella policy for $1mm coverage for $300 today from Geico...just required my yacht liability policy to have a $300k minimum coverage.

Now, you could also play all sorts of asset protection tricks. The worst that would happen then would be that you lose the boat in case of an accident. IE, form a Florida LLC ($125 up front + $138 a year) and put the boat title in the LLC name. Now, if you're willing to lose the boat (which if you have liability only, would happen anyway)...you're pretty much scott free except your PERSONAL liability for causing damage (again get a good umbrella policy to protect you there).

There are ways for those that are savvy to deal with the liability bugaboo...doctors are really good at this.

Its the rest of your budget that concerns me.

Also, *DO NOT* withdraw from your 401k early. If you do, you'll get whacked with a 10% penalty and pay taxes on the withdrawl. If you can, take "DISTRIBUTIONS* from your 401k. There is a subtle difference. Distributions of "substantially equal periodic payments" are not hit by the 10% penalty...just ordinary income. And if you're taking less than $15k a year, well, you'll pay some taxes, but likely get it back in credits. Welcome to being one of the "47%" Basically, you need to "annuitize" your 401k

See this from IRS site on retirement plans here: http://www.irs.gov/Retirement-Plans...garding-Substantially-Equal-Periodic-Payments

Is there an exception to the tax for distributions in substantially equal periodic payments?
Yes. If distributions are made as part of a series of substantially equal periodic payments over your life expectancy or the life expectancies of you and your designated beneficiary, the §72(t) tax does not apply. If these distributions are from a qualified plan, not an IRA, you must separate from service with the employer maintaining the plan before the payments begin for this exception to apply. If the series of substantially equal periodic payments is subsequently modified (other than by reason of death or disability) within 5 years of the date of the first payment, or, if later, age 59½, the exception to the 10% tax does not apply. In that case, your tax for the modification year is increased by the amount that would have been imposed (but for the exception), plus interest for the deferral period.
 
#29 ·
Thanks Mark and Aaron, you guys are giving me hope that next fall could work!

I alluded to this before, but to be clear, I have a pretty great life right now. Great friends, good job, lots of activities that I'm passionate about, and the money to pursue them. So, escaping was perhaps a poor choice of words. But after working in cubeland for 15 years or so, I'm ready for a life change. I'd be escaping a perfectly fine "normal" life for something more exotic. And I'm not looking to find myself...I know who I am. I love exploring. I love challenging myself. And I love sailing. And I love not working. Actually, sometimes I love my work too, but the idea of having the freedom to go where I want, stay as long as I want, and explore ot to my heart's content is very appealing.

A "sea of old people" is both hilarious and enlightening. I imagine many have some fascinating tales to tell, and that I'll find some younger interesting people exploring local towns.

And if I do find I don't like it, I can always sell the boat and go back to normal life, right? I do get that simply stepping back into where I was is not likely to happen. I'm ok with this.

I've read that you typically need to put in about 30% of the cost of a boat to equip it for extended cruising. Thinking I'll need a pretty good solar power system, watermaker, maybe wind gen, and great nav electronics and a powerful and super reliable engine - not neccessarily repower, but have a mech go through everything. I can see all that running 25-30k. But you're right, I can probably find most of that on a used cruiser.

Hadn't thought about buying in Fla, but maybe I'll start looking there as well. No reason I couldn't just live in a tent while checking out boats for a couple weeks. I'm not really planning on ocean transits. Maybe after a few years try to get to Europe. Maybe. Primarily coastal cruising. I guess "gunkholing", which is a new term to me. That's when you just find a spot to anchor that's not a port or harbor? If so, yeah, that's the plan. Writing, reading, photography, windsurfing and snorkling will all be done in mass quantities. Add to that biking and busing to explore inland.

So, couple questions about "the life".

When you're outside the US, do small towns and small ports typically have anchorage spots to throw down for free or do they charge? If they have moorage bouys, what do those cost typically? What about tying up for a few days down in the Carribbean and S. America? How much is that usually?

Also, what do you guys do during hurricanes? Outrun them? Ride them out in a protected anchorage? Anchor and get a hotel? Put the boat on the hard?
 
#32 · (Edited)
Thanks Mark and Aaron, you guys are giving me hope that next fall could work!

I alluded to this before, but to be clear, I have a pretty great life right now. Great friends, good job, lots of activities that I'm passionate about, and the money to pursue them. So, escaping was perhaps a poor choice of words. But after working in cubeland for 15 years or so, I'm ready for a life change. I'd be escaping a perfectly fine "normal" life for something more exotic. And I'm not looking to find myself...I know who I am. I love exploring. I love challenging myself. And I love sailing. And I love not working. Actually, sometimes I love my work too, but the idea of having the freedom to go where I want, stay as long as I want, and explore ot to my heart's content is very appealing.

A "sea of old people" is both hilarious and enlightening. I imagine many have some fascinating tales to tell, and that I'll find some younger interesting people exploring local towns.

And if I do find I don't like it, I can always sell the boat and go back to normal life, right? I do get that simply stepping back into where I was is not likely to happen. I'm ok with this.

I've read that you typically need to put in about 30% of the cost of a boat to equip it for extended cruising. Thinking I'll need a pretty good solar power system, watermaker, maybe wind gen, and great nav electronics and a powerful and super reliable engine - not neccessarily repower, but have a mech go through everything. I can see all that running 25-30k. But you're right, I can probably find most of that on a used cruiser.

Hadn't thought about buying in Fla, but maybe I'll start looking there as well. No reason I couldn't just live in a tent while checking out boats for a couple weeks. I'm not really planning on ocean transits. Maybe after a few years try to get to Europe. Maybe. Primarily coastal cruising. I guess "gunkholing", which is a new term to me. That's when you just find a spot to anchor that's not a port or harbor? If so, yeah, that's the plan. Writing, reading, photography, windsurfing and snorkling will all be done in mass quantities. Add to that biking and busing to explore inland.

So, couple questions about "the life".

When you're outside the US, do small towns and small ports typically have anchorage spots to throw down for free or do they charge? If they have moorage bouys, what do those cost typically? What about tying up for a few days down in the Carribbean and S. America? How much is that usually?

Also, what do you guys do during hurricanes? Outrun them? Ride them out in a protected anchorage? Anchor and get a hotel? Put the boat on the hard?
From Isla Mujeres to Cartegenia to Port Antonio Jamaica there are many small town's to anchor off for free. South America is Generally agood place to stay out of the Huricane belt. Rio Dulce is a good place to stay protected, cheap Marinas. Most things that have broke on my boat I've tossed and realized I never needed rather than replace. I broke a life line stantion 20 years ago and just got rid of the life lines, I wear a harness. My engine sh!t the bed so I tossed it. Boat sails better. My delfatable dinghy puntured so I started paddleing an old windsurf board like a sit on top Kayak. it stows well on deck, no one wants to steal it and I'm healthier. My centerboard popped a hole in my hull 200 miles off shore so I stuck a chop stick wrapped with a sock in the hole and it stayed that way for 6 months untill I careaned my boat on a beach and fixed it with some epoxy. There is alway's a way.
 
#30 ·
DIDO.I delivered a columbia 38 from passe-a -grille to K.W. last Feb. and fell in love with the place as well. I get off the tug on the 21'st and go back on the 4th so yes indeed I'll be around. I don't know where you are staying in Key west but my charter boat is at Safe Harbour Marina on stock island. Nice funky little marina 4 miles from down town and close to the reef. Probably a little cheaper than down town. Cool bar and rest. at the dock, the Hog Fish. It's like what the key's used to be.
I'm just glad there is a bunch of us out there catch'n some wind and going places. Weather it's around the bay or around the world. On a yacth or in a dory. Would I rather cruise on 50 foot Cat with a big budget? ofcourse. I wasn't going to let lack of oppulance and funds stop me is all. I'll P.M you my phone # when I get to land. Looking forward to hang'n out.
 
#31 ·
You're getting some great cruising advice and different perspectives. Since we don't really know you, all we can offer are different perspectives. You'll have to sort out what is best for you and I wish you well in the adventure.

The financial part does seem very shaky to me, so pay close attention to it. There is no way on earth to rely on 5% per year after taxes (perhaps penalties in your case) not to mention foreign exchange risk. Not to mention that over time, inflation makes things more expensive, but your principal isn't growing to provide a higher cash flow on your return. Not talking you out of going, but I'm pretty certain the math doesn't work.

Further, your brief description of your current lifestyle might suggest that living on the absolute edge of your resources would be a serious adjustment. Again, only you can know. But one thing missing from your budget that most cruisers seem to budget is a periodic flight home to see family or friends. Often annually while you get maintenance done.

As far as maintenance goes, single items can cost your entire annual budget and eventually will. You can't sail forever with the same sails or rigging. I'm sure you can scrounge and save.

My financial advice would be to save as much liquidity as you can, outside of your 401k. Go cruising until it's gone. Keep it invested safely (low return) and try to supplement with odd work, if you can. Let your 401k continue to earn untouched and build tax free. When you're out of everything else, its time to go back to work. Not a bad deal really.

Best on your adventure. (p.s. you did make one mid-life crisis comment above, but I'm not going to dwell on it. It's for you to sort out)
 
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