Is it possible to live mortgage free? Aside from being the recipient of a hefty windfall of course. We get remarks all the time on our ‘Cost-effective’ lifestyle, and how we must be ‘loaded’ now we’ve chose to live this way. It’s something which came up with a few wines in the Marina last week and something which I feel compelled to cover.
Now don’t get me wrong, if you want to give up the modern world entirely there are undoubtedly ways you could live on the waterways for next to nothing, but I want to cover this practically. I’ve ranted in the past about the wonderful Mrs Beeny, on her mortgage free vision, which usually falls into one of two categories: 1) Be a carpenter who is gifted land on your parents land to build a dream home, 2) Have an asset worth an extortionate amount of money that you choose to sell to buy another property. These programmes are everywhere now, but away from these TV delusions, is boat life a viable option in the chasing down the mortgage free dream?
Well yes and no, helpful aren’t I! We currently have a mortgage against our boat, granted it is going to be paid off in the next couple of years not the next 35, but it is still a mortgage, it is there and it needs to be paid for monthly. Of course this mortgage is considerably less than your average house mortgage, and we have chose to pay quite high instalments in order to see this paid off as soon as possible.
But when this is gone, whilst you gain that monthly amount back, the one thing we’ve come to realise about boats, well they are not renowned for their cheapness it would seem, I mean a decent vintage to lay on the roof with don’t come for free my friends!
When you drill down into it the costs for simply owning a boat don’t differ that much to the costs you face in a standard house. Let’s break it down.
Duck walkways don’t come for free, the Canals and Rivers Trust team need monies to put these in, apparently! Seriously I’m not trying to throw shade on the CRT too much, but I do have to question some of the initiatives that license fee goes to. Anyway, your license fee is calculated on where you go and the size of your boat, based on our boat it’s going to set you back around £900 a year. It’s an essential, it’s not avoidable, you can’t pay monthly, so you get hit with it in one go and without it you’re going to canal jail.
Now of course you have the option to constantly cruise the waterways, which is wonderful, if you have the freedom to do so, but sometimes you need some more home comforts or security, or perhaps somewhere to stay hibernated for the coldest months, which is where you’re likely to be looking for a marina. Whilst we are out cruising whenever possible our jobs see us all over the country so knowing our boat can be left parked up in a marina while we are away helping us to feel secure. Depending on the marina the fee’s you are charged can be crazy, taking a cross section of these you’re looking at around £3,000.00 for a year.
Sadly boats don’t run on thin air, they need a lovely expensive flammable liquid, thankfully boat engines do seem to be fairly economic so this isn’t extortionate but is still a cost to consider.
Your boat is only as good as it’s hull, and you want to keep that hull in tip top condition, to do this you are looking at having the bottom of the boat painted every two years, which involves pulling her from the water and covering her butt in sticky black paint. Of course cost savings can be made here by painting the hull yourself, but I’ll leave my opinion on that to Kimberley Wilkins:
It is a legal requirement to hold insurance for your vessel folks! I mean the possibilities on this are endless dependent on what you want to insure, as a minimum you’re looking at around £200 for the year for a basic level of cover.
Not only does your boats butt like attention, if you want to keep her in tip top shape you need to consider keeping her outside looking pretty. Boat painting is again very much a piece of string exercise, but it is expected that a good paint job will last up to 10 years, and the paint job it’s self can spiral out of control from £8,000 upwards … yikes.
Just because you live aboard doesn’t mean you don’t need to cook and turn a light on. You still use the everyday essentials, and these still cost money. Granted we are lucky that a good amount of our electrical usage is covered through our boat batteries and solar panels, but we do top this up when in the marina with off shore electric. Likewise, we need to cook, and this power presents itself to us in LRG form, so gas bottles are regularly needed. Your water, well that my friends comes for free in the boat world, WINNING!, however there is a good chance you will need to travel six miles along the canal to get it. Do not even get me started on keeping warm, be prepared to sell your soul in return for enough coal and crackle sticks to keep you going.
This one is a bit of a toughie. But as this isn’t the 80’s and we haven’t brought a house we’re not sitting on an asset which in 30 years time will be worth 4 million times it’s purchase price. In fact we would be lucky to ever see back the money we spent on Fantine. We therefore have to factor in that the asset we have chosen is depreciating. I tend to balance this off against the fact we do not have 35 years of interest on a mortgage, which makes me feel a bit better if nothing else.
So lets summarise all of that, I’m not including the fact that we have a mortgage on the boat, as this would make this investigation entirely without purpose.
License Fee = £75.00 per month
Mooring = £250.00 per month
Fuel = £20.00 per month
Blacking = £60.00 per month
Insurance = £16.66666666666666666 per month
Paint = £80.00 per month
Consumables = £36.00 per month
Electric = £13.00 per month
Gas = £6.00 per month
Warmth creation tools = £17.00 per month
Depreciation = Who knows!
Total = £537.00 per month
Now I want to compare this to what I see to be the average house costs, now it has been a little while since I’ve been in charge of bricks and mortar bills so excuse me if some of my figures are a tad out of date.
Council Tax = £100.00 per month
Electric = £30.00 per month
Gas = £35.00 per month
Water = £38.00 per month
House Insurance = £15 per month
Total = £218.00 per month
Now there is a bit of a difference there isn’t there. I mean I have probably missed something which is essential to house dwellers, but sorry I’m out of touch, correct me if I’m wrong. Even if you take out what could possibly consider as none essential, the costs really don’t differ that much.
So mortgage free? Well yes it is a possibility in the driest sense of the term, yes you can own your very own narrow home for a fraction of the cost of a house, that being said they were selling houses in my home town for a £1 not that long ago, and you can pick up a three bedroom terrace with change from £90,000. But if you’re expecting that moving aboard will equal a more cost effective lifestyle, well I hate to be the break it to you, but I don’t think that’s the case.
I’m not arguing the place of living narrow, I totally see it, I’m grateful for it, without it we would still be throwing our money to someone who was lucky enough to be born when houses were 20p, but I’m cautionary to anyone who thinks it’s the answer to living rich. Why am I cautionary? Well because we were naïve enough to think the same. Originally we saw living narrow as a way to purchase an asset and save alongside it with the hope of coming out with a mega deposit in five years time, fortunately we got swept away in the lifestyle and that silly idea was quickly forgotten. But I will be honest in saying, that the costs related to everyday boat life were much higher than I expected.
So mortgage free, well of course it is possible aboard, in a few ways:
- You have £50,000 saved to buy a boat.
- You buy a cheap do-her-up boat.
We’re close to mortgage free, and I won’t argue otherwise, it has of course happened a great deal quicker than it would in a standard house. But is it really the ultimate solution? I honestly think not, if you’re looking at life aboard as the ultimate money saver prepare to be disappointed, whilst I’m sure there are ways for it to be I can’t see it myself.
Take note Beeny and cohorts!
James & Kirsty