seafarers income
Budget, Finances, Maritime

5 Steps on How to Budget a Seafarer’s Income

We all know that seafarers income on board is more lucrative compared to the employees working ashore. But actually, life on board ship is not as sweet as a piece of cake like what other people are thinking. They see the abundant life of a seafarer’s family but they do not have any idea of what sacrifices he or she has to hurdle in order for him or her to receive his or her hard-earned money for the family’s future.

Besides from the hard jobs, most seafarers are also experiencing home sickness, loneliness, sleepless nights, at least 12 hours of work each day, no weekend rest and even during those times that they are sick, there is no one to take care of them and relieve them from their watch. Added to these are the different risks such as heavy weather, piracy attacks, collision, grounding, sinking, etc.

I was a seafarer and was a wife of a seafarer before we finally decided to stop sailing for me and my husband to build our own family. I know exactly the feeling when a seafarer tells you that he or she wants to stay home longer. Often times, at the back of their minds, they are thinking that  if  they only have a choice, they will  stay home and spend more time with their family.

cargo watch and ballast operation
During cargo and ballast operation. I had no sleep for 36 hours since we had 9 ports in China. I was so restless and stressed.

As a seafarer’s wife, it was very important for me to wisely manage our finances and make an effective budget out of my husband’s income. So if in case he wants to stay home longer, because he needs to rest for a while and wants to be with me a little longer, he can! There is no need for me to push him to go on board or him being obligated to go on board immediately because everything is well taken care of.

Added to that, he only had income when he was on board. When he was on vacation, he was not receiving any income so we live by the income from the previous months.  Thus, making a budget was really necessary for us to ensure that we have something when he was on vacation. Until now,we constantly pray to God that He will give us the wisdom and the discipline to stick with our budget and to live below our means.

” Be sure you know the condition of your flocks, give careful attention to your herds; “Proverbs 27: 23

When he was on board I made sure that every expense I made from his income was recorded. Even though he did not require me to make a financial report, I still made it and sent it to him through email every month. I knew how hard he worked to earn his income, so in return, I should be a good steward of his hard–earned income. I knew that most of the marriage fights are money fights so I was so careful to track everything to maintain the trust that my husband has on me when it comes to our finances. To God be the glory, although we argue on some other things, we never fight over money and we promised not to.

“Her husband can trust her, and she will greatly enrich his life.” – Proverbs 31:11

So this is how I budget our money when my husband was still sailing as a seafarer. I used the Zero-Based Budgeting Method by Dave Ramsey.

  1. Calculate monthly minimum expenses

This includes house, food, household utilities, car and all other bills that we were paying each month.

  1. Set aside money for health Care, insurance and investment of the seafarer

You never know what is going to happen while he is on board. What if the seafarer dies early? Is your family ready with all of the expenses at hand? What if the seafarer lives too long? Does he have a healthcare and funds that will take care of him after retirement? So, I set aside money for my husband’s health care, insurance and investment. The good thing is, his healthcare is 3 in 1. So in just one premium, he already has a long-term healthcare, insurance and investment.

“A prudent person foresees danger and takes precautions. The simpleton goes blindly on and suffers the consequences.” – Proverbs 27:12

     3. Set aside money for training and document expenses

To upgrade their skills, seafarers usually undergo training required  by their shipping companies prior their embarkation to their next vessel assignment. They also need to renew or apply for some required documents.

Avoid making a loan just to cover all of these expenses. Set aside an amount of money for these prior the disembarkation of the seafarer.

     4. Save money for the desired months of vacation

I can still remember when we were both sick and tired of getting a loan to ensure that all our bills are covered each month when he was on vacation. Most of his income for the first 3 months was spent paying the loan. That is why, we learned to set aside an amount of money to cover our monthly minimum expenses during his vacation while he was still on board.

This was the formula that I was using:  6 x (Monthly Minimum Expenses + Money for healthcare and Insurance).

     5.Help earn extra income for the household

When my husband was still sailing, I was also working in a shipping company office and had my business on the side. This helped us to increase our cash flow and for us to save more money at the end of each month.

But for some spouses who chose to stay at home to take good care of their kids which I am also doing now, you can also earn additional income while you stay at home, looking after your kids. You can come up with lots of ideas that will work for you just like starting a small business at home or online so that even if you are just staying home most of the time, you can still help your spouse earn additional income that can address some of the family’s expenses. This is a great way to help your spouse and I am sure that he will greatly appreciate you for this.

Below is an example on how to budget a seafarer’s income monthly. The figures I used are not ours. They are just examples and the amount can be higher or lower depending on your income and expenses.

Items Amount Running Total
A.     Income of seafarer: P 100,000 P 100,000
B.     Additional income: P   10,000 P 110,000
C.     Tithes: P   11,000 P    99,000
D.     Expenses:
         House P      7,000 P    92,000
         Food P    12,000 P    80,000
         Household Bills P      6,000 P    74,000
         Education P      7,000 P    67,000
        Miscellaneous/Transportation P      5,000 P    62,000
E.      Healthcare,Insurance,Investment P    10,000 P    52,000
F.      Training & Documents P    11000 P    41,000
G.     Savings for 6-Month Vacation P    31,000 P    10,000
H.     Emergency Fund P    10,000 0

A. Income of seafarer – the monthly income that the seafarer is receiving within a signed contract. In the example, I used P 100,000 as the monthly income within a 9-month contract.

B. Additional income – an extra income brought by the other spouse from business or work. In the example, I used P10,000. If the other spouse is having a business, he or she will have an irregular income . So, I also placed an emergency fund to cover the budget in case the additional income falls below P 10,000/month.

C. Tithes – 10% of the gross income that belongs to God who has given us the ability to produce wealth. This is given to the family’s local church. In the example, the family is receiving  a total of P 110,000 income per month. So the tithe is P 11,000/month.

” Bring all the tithes into the storehouse so there will be enough food in my Temple. If you do,” says the LORD of Heaven’s Armies, “I will open the windows of heaven for you. I will pour out a blessing so great you won’t have enough room to take it in! Try it! Put me to the test!” – Malachi 3:10

D. Expenses – The minimum amount of things that the family is spending on each month. In the example, the total minimum expenses of the family is P 37,000/month.

E. Healthcare, Insurance, Investment – This is for the protection of the family and care for the seafarer if  he/she  dies early or lives too long. I used P 10,000/month  in the example.

F. Training & Documents – the amount set aside for the seafarer’s trainings and documents after disembarkation. In the example I used P 11,000/month. At the end of the 9-month contract, the seafarer will have P 99,000 for his training and documents.

G. Savings for the 6-Month Vacation – I used this formula:

 ((6*(P37,000+10000)/9) = P 31.3333 I round it off to P 31,000

This will cover the monthly expenses for 6 months while the seafarer is with his family,

H. Emergency Fund – To be used if there is an unforeseen emergency or if the additional income is below the expected amount. For the example, I used P 10,000/monthly.
emergency fundAt the end of the 9-month contract, the figures will be the following:

Items Monthly After 9 Months Contract
A.     Income of seafarer: P 100,000 P 900,000
B.     Additional income: P   10,000 P    90,000
C.     Tithes: P   11,000 P    99,000
D.     Expenses:
         House P      7,000 P   63,000
         Food P    12,000 P  108 ,000
         Household Bills P      6,000 P    54,000
         Education P      7,000 P    63,000
        Miscellaneous/Transportation P      5,000 P    45,000
E.      Healthcare,Insurance,Investment P    10,000 P    90,000
F.      Training & Documents P    11000 P    99,000
G.     Savings for 6-Month Vacation P    31,000 P  279,000
H.     Emergency Fund P    10,000 P     90,000

As I said, the amount can vary from family to family but the process in making the budget is just the same.

If you are a seafarer or a wife of a seafarer, make your budget prior the start of each month. Make sure that you track all of your expenses and always stick to your budget.

I do hope that you’ll find value in this blog post and if you know people who need this, don’t forget to share this with them.

“Wisdom is a shelter as money is a shelter, but the advantage of knowledge is this: Wisdom preserves those who have it.” – Ecclesiastes 7:12

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