Chartering vs. Owning: Why Many HNWIs Prefer the Freedom of Chartering

You're dreaming of sailing the high seas, and you're loaded. Whether you purchase a yacht or simply rent one for a while is the key question. Although owning a yacht seems like the ultimate flex, many affluent people are choosing to charter instead. It gives you a lot more freedom, is less trouble, and ultimately costs less. Here's why, broken down so you can see what's what, chartering frequently outperforms ownership for the ultra-rich.

The Money Trap of Ownership 

Let's discuss potential problems before you even consider writing that check. The cost of a yacht, which starts at a million dollars and quickly rises, is only the beginning. The maintenance is where the real suffering occurs. The annual cost of crew pay, dock fees, insurance, and repairs can amount to 10–15% of the yacht's value.

Even if your $6 million yacht is just sitting there looking nice, that's still $600,000 to $900,000 a year. Does the engine give out, or is it hit by a storm? Put another large bill on it. The difference with chartering is that you pay a single amount, perhaps between $30,000 and $300,000 for a week, and it takes care of everything, including crew, fuel, and maintenance. There are no lingering expenses; you're in and out.

Choose What Is Effective for You 

Being stuck bothers wealthy people. When you charter, you can choose any yacht that appeals to you. For a large party in the Mediterranean, you might want a 200-foot beast with a personal chef. Perhaps a fast 50-footer for a peaceful weekend off Bermuda the next time. It's similar to choosing the appropriate attire for the situation.

But owning a yacht? You are limited to a single boat, which may not always suit your needs—it may be too large for certain harbors, or it may not have the infinity pool you have been longing for. Because chartering allows for flexibility, every trip is flawless.

Read: Why A 70 Ft Luxury Yacht Is Perfect For Your Next Celebration?

Avoid the Trouble of Managing a Yacht 

It's like taking on a full time job when you buy a yacht. You must find a reliable crew, maintain the boat in excellent condition, and deal with a confusing set of regulations that may vary depending on where you dock. Are you chartering? The game is completely different.

All of that is handled by the professionals, who also fix the boat, hire the right people, and handle the paperwork. Simply roll up, relax, and take in the atmosphere. It's the simplest method to prevent a careless mistake from ruining your entire trip.

Go on Your Next Journey 

The excitement of exploring new locations is the main attraction of yachting. You select a boat that is already parked where you wish to go when you charter. Drag an owned yacht around the world doesn't have to take weeks or cost a fortune in fuel. Transporting a vessel from Europe to the Pacific?

That's at least $150,000 in expenses and a headache for a month. Chartering breaks through that oversized vessel. Wherever you're going, you board a ready-to-go yacht so you can spend your time sailing and not get bogged down in details.

Try It Out First 

Hold off if you're desperate to purchase a yacht. Chartering is similar to trying out a boat without making a commitment. Try something larger or smaller after a week on a 100-footer. You'll discover your true needs; perhaps you'll find that a submarine is overkill or that you want a sundeck for parties. It's a low-risk method of getting a feel for things without spending millions on a yacht that doesn't work out.

Conserve Cash and Maintain Your Sanity 

Yachts can lose 10–20% of their value every year, so they aren't exactly investment gold. By chartering, you can save your money for more intelligent investments in the stock market or real estate. It also relieves you of the burden of maintaining a boat that you hardly ever use.

Although most owners only sail for a few weeks each year, they pay for maintenance all year long. In addition to the guilt of an idle yacht, that is stressful. Are you chartering? You enjoy yourself without having to worry about money or your mental health.

Based on the Data 

Assume that the annual expenses of your $8 million yacht come to $1.2 million. After five years, you have spent a total of $14 million. A comparable yacht can be rented for $150,000 per week for three weeks out of the year, which comes to $2.25 million over five years. With none of the drama associated with maintenance, that is a fraction of the price. 

Start Now 

You can enjoy all the boating excitement without having to deal with the hassles of ownership when you charter. Are you prepared to go out on the water? To find the ideal boat for your upcoming vacation, give a charter broker a call.  

It's Your Turn: Have a dream location for your yacht? Leave a comment with it!