The stages of ‘Yachties’ financials
Do you remember when you first arrived in Palma and realised what a great city it was? Let’s reminisce for a moment – You found the Corner bar, Mojo´s and Cuba bar. You became an expert on the local eateries around Santa Catalina and La Lonja and, very soon, were able to inform any “newcomers” where they could go to eat, drink and spend time…
Sound familiar? Then, very soon after, you realised you were living like a student again – sharing a flat and no longer able to enjoy the local restaurants every night. This is when you had to take a deep breath and find some work.
You clean, you scrub, you polish, you chamois, you hang upside down in stinky bilges… you do any job you can, in order to keep adding experience to your CV and show willing to potential employers.
Then it pays off and one of the boats that you do day-work for agrees to take you on for the season. You are now a “Yachtie”, which you post in dock-walking forums, telling people in the bar “what worked for me was…”. Plus, you also start to realise how much hard work you are expected to do.
Hopefully, you don´t envy the Captain too much when he gets in his own car and drives back to his house and family where it’s quiet with a nice community and, which most definitely, does not have a sea view. The people he now drinks with talk about dock-walking in their former lives as if they are bad childhood memories.
During the season, you probably hit the south of France, Monaco and Sardinia. The prices in the local bars are ridiculously expensive but you don´t care! You are well paid and you can afford it, you have no expenses and you were tipped €1,000 last week, which is burning a hole in your pocket. The guests on the boat spend €100,000 just to charter it for a week, so what is the harm in you spending a couple of grand during a two day leave?
The season then ends and you use what is left of your season’s earnings to go and do some travelling. When you get back you realise you need to earn money, so you need another job! Dock-walking is a thing of the past, so what can you do? You are no longer on the lowest rung of the ladder and so you recruit the help of a reputable Crew Agency to assist you.
You make sure this season counts; carrying out your duties diligently and even trying to behave yourself. Well at least whilst “on board”. Instead of blowing all your money this time, in an effort to further your career, you wisely invest in courses to become more qualified.
End of the third season is usually the breaking point. This is a time when you decide whether you can deal with the wobbly legs every time you go ashore or not. If you continue, the one big change in your attitude to this world of glamour is that you realise you are not the ‘one’ chartering the boat, you are part of the hard-working crew ensuring the boat runs smoothly.
Despite the Med being a large place, it’s a relatively small community that you work in, and so experiences are shared and compared with fellow crew members.
The next objective on the agenda is to buy an apartment. You don´t exactly know why, but all the other senior yacht crew own apartments and so, therefore, it has to make sense. Yet, you have no idea on how to get a mortgage. This could be complicated due to the fact that your Tax returns need updating and you don´t have time to follow any markets apart from the exchange rate to your home currency.
Eventually you find a Mortgage Broker or Bank that will offer you a mortgage on your international assets and, if you´re lucky, they will understand to a certain degree your unusual tax situation. You succeed and buy your first property, most likely without comparing whether this was the right route to take or whether you could have considered alternative investments.
Maybe you could have used your deposit money differently, in a more simple and effective way for your tax situation? But, the good news is that your hard-earned money is now working for you.
From this point there are normally two main routes to follow; for the guys, it is Captain or Engineer (Chief Engineer if it´s a big boat) and, for the girls, it is usually Chief Stewardess or Head Chef (the most important person on the boat!). Although, to be fair, this has seen a bit of a turn-around in recent years.
This is the good stage in your career – a time when you get to choose the boat rather than the boat choosing you.
You may, without taking stock, be on your second or possibly third property, and perhaps you have or are talking about settling down and having kids, quite likely with someone you met on board or within the industry. This stage is also referred to as the “sea sick” stage.
For you, “home” is now often nowhere near the sea, hence the stage name (“seasick”). Many head inland towards Alaro and the surrounding areas where there is a wonderful community of like-minded people (interesting point – did you know that Alaro used to have its very own Yacht Club? My parents were members!). Seasick stage is also when you are starting to communicate in the local shops and bars, in Spanish.
However, most of your compatriots and the people you eat and drink with are English speaking. Your children translate for you when you have difficulty changing your phone. Your Facebook is no longer full of yachting agencies and crew placement agencies but contains the many friends you’ve made along the way.
Would you agree that by this stage in life you´ve probably realised that;
1) Properties are not the only investment as they take up a lot of your time and money to maintain.
2) Boats can offer you a great living, but they offer you no pension or provision for retirement.
3) Boats offer no medical insurance or life insurance when you are ashore.
4) Kids are expensive – especially if they attend an international school (fees usually start at €700 a month for 3 year old).
5) Dealing with your complicated Tax situation is becoming more and more urgent.
6) The Yachting World is a demanding industry on family life, but the benefits make it difficult to breakaway in the future.
7) Finding a good boat to run is essential and is a little similar to owning a successful business.
8) If you have kids and/or a spouse, Inheritance Tax is a real issue and something to be addressed.
9) Capital Gains Tax and Stamp Duty begin to affect the true value of your property/properties in a depreciating way.
10) Keeping your money safe has become one of your primary objectives – the future for you and your family is a main concern.
11) Local Banks might not completely understand your situation and so therefore there might be better options out there.
In order to help people with their finances someone has to understand who you are, what you do, what you want and what might happen to you in the future….
If you want to talk to someone who understands your history, goals, ambitions, and the position you are in… someone who can help you with the complications that come with working on super yachts and how to make your hard earned cash work for you, you need to talk to me … – let’s have a chat, it’s free!