The superyacht crew guide to financial greatness | United Advisers Marine

1st Sep 2019

Beginners guide to financial greatness

Are you new to yachting or starting to think about investing? The majority of crew leave yachting with no savings. If you don’t want to be part of this statistic read our guide to achieving financial greatness. We promise it isn’t boring and there is even a KISS at the end.

What is financial greatness?

Being debt free and having the financial freedom to make the personal decisions that you want in life. This might mean having the freedom to travel where you want, being able to change roles or invest in new qualifications for a promotion.

1. Mind the gap

The aim here is to have a large a gap as possible between what you earn and what you spend. The bigger the gap, the bigger your opportunity for financial freedom. It can be tough deciding how much of a gap you can live with.
Whilst you are working onboard you should have the opportunity to increase this gap. This is because you won’t be paying for rent, uniform or food. If you are lucky enough to benefit from tips, this adds directly to your earnings, which should increase the gap:

Make a list of all the outgoings that you have to have. Then list your outgoings that are optional. Which of these could you live without? Are there any that have become unnecessary habits?

2. Becoming debt free

Financial greatness also includes being debt free. Step 1 of this is to list all your current debts. This includes everything from student loans, parent loans, store cards, car finance and credit cards.
Whilst a mortgage is also a debt it is also a long-term investment and it is unlikely that you can pay it off in the next 1 to 2 years. If you are close to your final payments then add it to your debt list!

3. Take a challenge

Most people rise to a challenge. Think about the current popularity of marathons, Stoptober and the ’30 day ab/yoga/crunch challenge’. Financial greatness is no different. Set yourself a really clear goal.

A popular challenge is to increase how much you save by 1% each month. So you start at 1%, increasing by 1% each month. This is great if you don’t feel that putting aside 20% of your savings is an achievable goal.
As we mentioned earlier it is better to save a little than nothing. The Bank Rate set a 52-week challenge which involved starting saving at $1 and increasing this by $1 each week. So the most you are required to save? $52 a week. Even this small sum amounts to $1,378 a year.
Or perhaps there is a monthly habit you could change. So rather than ‘treating’ yourself to a new item of clothing or gadget each month you could swap it out for a saving sum.

4. Save your promotion

Next time you have a savings increase, be it a large tip or a promotion, try and bank that cash immediately. Don’t get used to having it as part of your disposable income, This is one of the easiest ways to achieve financial greatness.
Set up a plan that takes away your increased salary payments automatically each month. You are unlikely to miss it as you’ve been getting along just fine without the extra cash. However, we can guarantee you will love seeing those big savings accumulate!

5. It is all about KISS

You may have already come across KISS elsewhere, Keep It Super Simple. The same goes for your finances. Having lots of debt spread across cards and countries will complicate things. Setting unachievable goals that you can’t achieve will only lead to frustration.
Get a plan together that works for you. Calculate what you can afford to save without a complex Excel spreadsheet. Most importantly; be honest. This will keep things really simple. Think about what you really want to achieve as a long-term and short-term goal.
If you don’t know how to go about answering these questions then give us a call. We can talk you through building a plan and how to go about setting financial objectives. By reading this article you are already on your way to greatness. Give yourself a high five.