Making Money Tristan on 09 Jul 2008 04:36 pm
Deadliest Catch: what they should do with the money they earn from crabbing?
I’ve been watching the series Deadliest Catch on Discovery Channelfor the past few weeks, and have really enjoyed it. I like the way the guys who work on all the boats are real characters, and the trials and tribulations they all face.
What I find most fascinating is the notion that these crab fishermen go out onto the Bering Sea and fish for a couple of weeks, and then come back in with a haul of, in some cases, over $1million worth of king crab. After the costs, the deckhand’s usually end up taking a cut of around $40,000 – not bad for a few weeks work, hell even for a whole month!
I wonder how many of the deckhands just blow their money as soon as they get onshore? I know that if that had been me in my early twenties, I would definitely be looking to have a good time with all that money.
What would I do with the money now? I would be looking for opportunities to invest some of the money made into providing an income for me all year round, as fishing is obviously a seasonal business.
What opportunities could you buy with $40,000? A whole range of things. You could use the money as a down payment on an investment property, though if the buy-to-let market in the states is as bad as it is in the UK, then it may well be worth holding off on that. Perhaps you could invest the money in another business, $40,000 won’t get you that far, but it may be enough to buy into a franchise business, which as long as it turns a profit each year could provide you an income when you’re not at sea.
Alternatively, you could buy income bonds, although a fixed income bond @8%, is only going to generate $3,200 a year in income, so you would need at least $400,000 worth of income bonds at that yield to generate a reasonable yearly income.
I think if I was a crab fisherman I would use some of the money I made after each season to clear some of my mortgage, put some money into savings, put some money into a personal pension plan, and live off the rest.
I really don’t know how often these guys go to sea, I would guess they fish for about 6-8 months of the year, so they may well be earning some decent money. In which case, if I were in their shoes, I would be looking to save/invest a lot of the money made, so that I could either take early retirement – from crab fishing at least – or move into another profession that didn’t carry with it the risk of dying in icy cold water! Perhaps I’m being too risk-averse, perhaps half the reason they do what they do is for the thrill of the chase, and the dangers it carries.
on 09 Jul 2008 at 8:13 pm 1.John said …
Sounds rather like the guys making similar money for a season trucking on the ice roads in Canada (see Ice Road Truckers currently being repeated on Five).
on 23 Jul 2008 at 9:41 am 2.Chris Miller said …
I too watched that series of programmes and found that they always run the risk of not earning any money at all from the weeks catch. If there is any problems with the boat and/or the fishing spots, they could even end up at a loss from the trip due to diesel costs
I think that this would make it more important for these guys to use their money wisely and invest in something that gives them (and their families) the money that they need to survive.
I would suggest that a £($)40,000 deposit on a property, could get you a good buy to let with at least a few hundred bucks a month to look after the family.
Do 4 - 5 trips in one year and place deposits on properties and they could have a £1,000+ income from the properties.
This would mean that they wouldn’t have to worry about their “fishing trips” going badly as the family would still have food on the table. And if they needed to, they could re-mortgage the buy-to-lets to take extra (tax-free) cash for unexpected events.
In conclusion . . . . I wouldn’t do it. . . They are very brave . . . and good luck to them.