The Hidden Expenses to Owning a Boat

It’s easy to get swept up in the excitement of buying a boat, but the process should be deliberate and careful, not least because of the financial implications. To fully anticipate those, you must go beyond the obvious costs of buying — and, as needed, financing — the boat.

Taking to the water in your own vessel requires outlays that some boat beginners may not know about, or at least haven't yet quantified. You may need to buy a trailer, for example, along with safety and recreational gear for your passengers to use. Ongoing obligations can include insuring the boat, not to mention keeping it fuelled and paying its marina fees and maintenance bills.

It’s best to think about these expenses ahead of any boat purchase, since the type of vessel you buy will affect their cost, potentially by a lot.

Let’s review some hidden costs of owning a vessel, and how they vary by the boat you decide to float.

Storage and docking

Mooring costs at a marina can be expensive, especially if you own a larger boat. Many marinas charge by foot, so if you want to moor your 16-foot boat at a marina that charges $25 monthly per foot, you can expect to pay $400.

Dry slips, which store your boat in a scaffold-like structure out of the water, are generally cheaper. However, your dry slip may charge a launch fee each time you take your boat out onto the water and a haul-out fee each time you return.

Even storing your boat on your personal property isn’t without additional costs. If you live away from the water, you’ll need a way to transport your boat. Boat trailers can be expensive, starting at $700 for a single-axle trailer. You’ll also have to own a car that is powerful enough to pull a boat.

You’ll also have to consider where you’re going to keep your boat in the off-season. You’ll generally want to keep your boat dry during winter to prevent ice damage and mold. Indoor storage units are considered safest, but are also costliest. Indoor storage can cost $50 monthly per foot of boat length.

Insurance

Boat insurance isn’t required in most states, but you’ll have to purchase insurance to dock at most marinas. Additionally, if you’re financing a boat, your lender will require you to buy insurance. Even if neither condition applies, insuring a boat makes good sense financially.

The premiums typically run to $200 to $500 per year. The exact amount will vary based on the type of boat you have, its age and the horsepower of its engine. Insurance companies will also look at your personal profile, including your boating experience.

Registration and taxes

Boat owners are required to register their vessel in the state where they boat. Fees will vary by boat size. For example, in Virginia, the three-year registration for a boat less than 16 feet costs $32, while boats 40 feet or longer cost $50. (In most other states, the registration is also for a few years at a time).

Most states also charge sales tax on boat purchases, which can significantly increase your initial cost. You may even find yourself paying local sales tax in addition to state tax, depending on the state you live in. For example, California is infamous for its local tax rates on boat purchases. In some areas within the Los Angeles area, boaters can pay a total of up to 11.25% in sales tax.

It’s important to note that sales tax also applies to used boats, and even if you purchased your boat directly from the previous owner. When you register your boat, you’ll have to bring proof of tax payment. You may also pay sales tax when registering your boat.

Some boaters will have to pay a use tax if they didn’t pay a sales tax at the time of purchase. Use taxes are often charged when a boat purchased in a state that doesn’t charge sales tax is transported to another state for use. Its purpose is to ensure boaters can’t dodge sales tax by moving a boat from one state to another.

There's more: certain states also charge an additional annual tax on boats. For example, Massachusetts charges an annual excise tax, of $10 for every $1,000 of your boat’s value.

Maintenance and repairs

A rule of thumb is to set an annual maintenance budget that’s equivalent to 10% of your boat’s initial value. You’ll also want to keep an emergency fund for any significant and unexpected repairs, like replacing an engine.

Maintenance costs are higher for certain types of boats. For example, saltwater is harder on a vessel than freshwater, so saltwater boats require more care. Additionally, as with a car, a used boat may require more frequent maintenance than a brand-new boat.

It’s also important to change your oil regularly. You’ll want to change your oil after every 100 hours of use or once a year, whichever occurs first. A professional oil change can start at $160.

Another annual maintenance task boaters need to familiarize themselves with is winterizing. This is the process of preparing your boat for colder temperatures during the off-season, which can be done yourself or by a professional. Costs to professionally winterize your boat will depend on its size and the type of motor you have, but you can expect to spend as much as $500.

Fuel and operating costs

Your fuel spending will naturally vary with the type of boat you own. Most powerboats will consume six to eight gallons of fuel per hour, while sailboats running on their motor will use one to five gallons per hour. Smaller boats generally require ethanol, while larger boats often require diesel. The average cost of ethanol as of September 2025 was $3.17 per gallon, while diesel cost $3.73 per gallon.

The bottom line: budget for fuel costs of at least $25 for each hour you plan to use your powerboat.

Onboard equipment

To use your boat legally, plan to acquire the required safety equipment. While the precise list will depend on the type and size of boat you have, the Coast Guard typically requires the following:

• A personal flotation device for everyone on board
• A throwable flotation device, like a ring or cushion
• Visual distress signals (three for day-use and three for night-use)
• Fire extinguishers
• A sound-making device
• Working running lights
• A backfire flame arrestor (for powerboats with inboard gasoline engines)

Boats, both new or used, often come with the required items, but don’t count on that. You’ll also want to consider additional equipment that, while not required, is highly recommended, like first aid kits, paddles for emergencies and an anchor. If you're an active boater, you might add such gear as water skis and a water-ski rope, which can together cost $100 and up.

Depreciation

Like any other possession you run regularly, your boat will wear down with use and its value will depreciate. The depreciation is greatest when the boat is new.

On average, a new boat will depreciate 20% to 30% within the first five years. However, the rate at which your boat will depreciate will vary based on how often you use it, how well you take care of it and its build quality.

Too expensive? Boat without owning a boat

If a boat feels financially out of reach after you tally all of the additional costs you’d need to pay, there are alternatives to owning your own boat.

Boat clubs are a popular alternative to boat ownership. These clubs have a fleet of ships that members can use. Boat club costs vary by location and the boats in a club's fleet, but expect to pay an initial fee, generally starting at $2,000, and ongoing membership dues, usually at least $200 per month.

You can also consider chartering a boat each time you want to get out on the water. Per outing, this is the more expensive option, but you’re not burdened by any of the responsibilities or sunk costs of owning a boat or even a boat club membership.