Would you like to spend your retirement, or even a very early retirement, traveling around the world on a cruise ship, while earning money in the meantime? I’m not suggesting becoming an employee, rather a long term, highly valued guest . There seems a spot where you can find arbitrage within renting out your accommodation via AirBnB, leverage Uber to earn more, and reduce your overall costs by playing the travel hacking credit card game. Throw in a bit of internet based earning, and you are all set.
The notion of spending traditional retirement living on a cruise ship as an alternative to a retirement home has been brought up in the past, but the articles examining it were sometimes a little clumsy. These guys got the idea of the positives of cruise ship living: serviced accommodation, food, entertainment, medical care all onsite. Plus, perhaps more critically a support group of people close to hand to watch over you, keeping the brain ticking over with human interaction. They simply failed on the math of pricing out this option, by looking at full fare prices for data points, and not considering additional income streams to offset living expenses. In fairness, more options have since emerged on the income front in recent years.
How cheap is cruising?
When people first thought of this notion, they were pricing cruises at rack rates. Would the math work out at $599 for a 7 day cruise? How about $499? The thing with cruise pricing is that it is a little complex – the number you are quoted is based on double occupancy,and then they add on taxes and fees. These are mysterious things, but you could easily look at $100-150 for port fees/charges and taxes on top of the fare.
You can actually find cruise fares that are listed at around $30 per diem. Add on the fees and double occupancy, and a realistic price would hover around $100 per day per couple. One major expense would be gratuities, which range around $12 per person per day.
If you consider that price gets you not only your room, but also unlimited meals, free entertainment, and great travel, that’s a pretty good deal for around $1,500 per person per month. The cruises here from Princess at 90% off look like great value!
What about the other side of the balance sheet?
Offloading that expense can come in many ways, if you are traditionally retired, you might have access to Pensions, IRAs, a 401(k) and social security. As an aside, people really should look into the cost/benefits of deferring social security payments until 70 to maximize payments. Additionally, those of traditional retirement age, or the early retired, could leverage their existing assets to create income.
- For those who own a home, AirBnB would be a way to monetize that property. Pricenomics has data showing that the average price per night for renting your property via AirBnB can be has high as $185 in Boston, to as low as $75 in Albuquerque, NM. As such, if you were to rent out your property via this service, you could completely offset the cost of living on the cruise-ship, or at least reduce some of the costs of doing so. If you added on a cleaning service, this could be a fully automated rental income property for you.
- Uber is another option to increase income. If you wanted to work for a day in port, you could ferry passengers around to bring in some income. Just park your car at one of the cheaper carparks, available from $6 per day, get up early on the last day of the cruise to pick up your car, and start shuttling disembarking passengers to the nearby airport. Port of Miami to MIA comes in at about $17-22 per trip, and if you could book return passengers you could generate $60-$100 per hour.
- Online income. The tech savvy could generate income from the internet. If you were effectively living on a cruise ship you could generate a ton of content, and quickly become the specialist in your space. You wouldn’t make a lot of ad sales initially, but you could monetize by advertising your car shuttle service on the site, and pre-book trips to the airport for disembarking passengers, and also could offer tours of the ports, since you would quickly become an expert. You could mimic whatever the Shorex was offering onboard the vessel, and undercut their pricing by 50% and still make a massive profit.
Let’s not forget about credit cards to reduce costs either. A great card would be the Barclay Arrival+ which could be used on any of the cruise lines. At 2.2% it offers better value than any of the co-branded cruise credit cards. Or you could go the 5x route, and pick up a card that offers 5% cash back in Gas, Grocerys or Drugstores, and while one person is shuttling people around town, you could be off earning your keep… one good home port day could earn $400-500 with ease.
I’d also suggest looking into some hotel based cards, so if you got to a situation where you couldn’t walk off one cruise and onto the next, you could cash in some points to cover the night. As you can see, big ports like Miami have plenty of hotel options. Depending on where you are based, chains like Best Western, Choice and low tier Hilton, Hyatt, and SPG properties could all offer a lot of value for your points.
Loyalty Matters
If you were to opt for a life at sea, and you decided to book absolutely the cheapest fare each time, on any ship available, the cruise line would reward that loyalty…yeah most frequent flyer loyalty programs are somewhat dumb like that. But not to worry.. top tier perks can range from cocktail receptions to dinner with wine at specialty restaurants – which are certainly nice little perks when you are getting them weekly! You’d also finally get to pay for your rent with a credit card that earn miles..
I think there is an interesting arbitrage opportunity here, and it could make a lot of sense, especially for a couple who owned a home, but didn’t have a large amount of savings. This could reduce monthly outflows, while being a lot of fun too. Cruise rates at 90% off vary by season, so you would have to chase the rate, right now it is the Bahamas, but at other times of the year you can find similar discounts to other areas, including a lot of deals in Alaska.
Conclusion
This idea has been brewing for sometime. I actually worked on cruise ships for a while (highly recommended for college age kids) and while they covered my room and board, I did wonder about creating cash flow generating assets to offset the cost of the cabin.. doing so means you wouldn’t have to work those long hours, and instead could lord it up. At these prices, it is surprisingly affordable to do, and I think many people could create enough income to support living on a cruise ship year round. The advantage of taking the AirBnb approach means that if full time was too much, you could pick and chosoe, and simply book out your home one week a month, and pop off on a cruise while making a profit…
Awesome post & idea. I’d considered this, but was thinking along the lines of finding a particular ship (such as one that goes around the world) and haggling for long term residential rates.
Looks like you’re thinking of stacking short cruises to create a long term plan? Great idea. Only drawback for me is not being able to take my beloved dog. Still though, I’m keeping this idea on the back burner.
Yeah, with so many cruises that depart from MIA (plus nearby terminals of FLL etc) I figured you could just bounce around cruise to cruise, drop off your laundry on port day, pick up clean when you return etc… the dog would certainly be an issue though. As an interesting aside, the QM2 (Cunard) has a policy where you can take them on transatlantic journeys – they even have a ‘poop deck’ !
Love the idea! But sadly I don’t think that the guy I plan to spend my retirement with would be into it.
On a smaller basis, many academics (people who teach college) sign up to spend a term/semester/year abroad. Usually the programs provide housing. So you can rent out your home/apt. and living costs are paid by the program. You do have to pay for food and perhaps a car. So depending on where you are and the program terms, you can make money.
But of the people we know who did this, most said the time away did cost them because when they were not working, they spent a lot traveling around, paying high fuel costs and for hotels. Of course we miles and points peeps can minimize this somewhat.
Another nice academic option is the Semester at Sea program. We know a lot of profs who have done this but getting an appointment is very competitive. The students also have a reputation for not being too serious. Nevertheless, I am hoping there will be a semester at sea in my future as a trailing spouse.
Yeah there are some good options out there – another would be to just go cruising and hire the cleaning service and set up some keydrop system where you could just rent it out automatically, and take what you can get.
HAL had a great program called ‘wife on board’ for their officers – the officers had a great gig anyway, and the spouse travels with them for free.
This lifestyle is something that I have considered. Who has been on a cruise and NOT considered it? I have met older couples on cruises who are actually doing this, but they are living on retirement income. They will book back to back cruises several months at a time. Perhaps you met folks like this when you were working on a ship?
There are many interesting ideas that you have brought up that are worth exploring. Let’s talk about the casinos first. Say that you were a professional poker or blackjack player. Do you think that your activities would be tolerated in the cruise ship casinos? Would you be forced to move from ship to ship, or line to line?
I hope that this conversation runs awhile, either here or in the forums.
To the Forums! http://saverocity.com/forum/threads/perpetual-cruising.8596/
Tried to post a few minutes ago, but my internet died. I would not be happy if I was actually paying the $10.95/day internet charge at the hotel.
I’ve often thought about this. Primarily as a thought experiment, but I do think there are ways to make it work. There would be some obvious challenges, but coming up with alternative solutions is part of the fun. I live and travel alone (and don’t anticipate that changing), so my back of the envelope calculations come out to about $40,000.00 per year.
I’m already living out of hotels full time (nomad!) so I have no house, car, furniture, or major possessions to worry about. My suitcase and I could just move into a cabin for a few months or a year. I’ve almost talked myself into it. Who know? Once I pay off my debts, fund my retirement accounts to my FIRE minimum, and save up the $40M – maybe I’ll give it a go.
Especially interesting to think through the ways to potentially lower costs through travel hacking methods.
Good to hear that you are focused on the debts and then FIRE. If you look at that 40K (which is generous) we could also go down the route of the SWR of 4% (an entire debate on that could also ensue…) but you’d be looking at 1M to pay for this lifestyle. However, the travel hacking side would drop that massively.
I’d imagine a relationship with a TA would help a lot for this, then pay that off with the arrival, and earn a ton of points on port days. you could probably earn the 3-4K per month with some ease.
Yeah…the $40M was meant to be conservative and didn’t include discounts from travel hacking. The Arrivals card + MSing while in port could bring the costs down significantly. I wonder if I could find a way to MS enough to get the cost for cruising to zero — that would be the dream. If I’m budgeting 100/day on cruise costs (fare, taxes, gratuities, alcohol, miscellaneous spending) then I’d need to generate approx. $3,000.00 in points per month. I’m definitely not advanced enough to scale MS to that degree (yet) — something to learn over the next few years.
$3K a month isn’t that hard, but you’d it is location dependent, and I hear parts of FL aren’t great. Certainly start small and work up!
There was a old lady living on Queen Mary 2 when we were on there a couple of years ago. All the crew knew her, and she was very chatty with the customers. Every six months or so she would have a little “break” in New York, and periodically her family would join her for a short cruise. We also heard about a lady who had lived on QE2 – didn’t ask the QM2 lady if it was her!
Having worked for cruise lines that have long term guests onboard I can tell you that you can not base the price on what you see online. Most people who do this prefer the luxury lines and a per diem is negotiated by the guest’s TA and revenue management at the line. Still it is a great value, especially on all inclusive lines where all beverages including alcohol are included. The ladies I know doing it are happy. Funny thing is there are no gentlemen doing this, at least that I know of. All widows or single seniors ladies.