Why Seamen Cannot Save?

Why Seamen Cannot Save?-Saving for Retirement from The Sea & The Ships!

It is a common observation that seamen though getting paid much higher than land lubbers do not succeed in saving for their retirement effectively. Seamen, most of them, do not think of their retirement while they are working onboard vessels until very late in the career. I have seen large number of seamen who did not save for the future and there career at sea came to a halt abruptly without sufficient notice, causing them and there families difficulties in managing day to day living.

Why can't seafarers save - Where does their money go?

Lets have a look at some of the factors that do not let seamen save money for their future and analyse where do the seamen’s earnings go! Lump Sum Income and big spending habits. Getting lump sum at the end of contract has been one of the major reason for spending unrealistically. In the earlier days of sailing it was common practice to be paid some cash advance onboard and the remaining balance of salary at the end of contract. Even today when a seafarer comes back home, he finds his bank balance healthy due to accumulated salaries, transferred monthly, from last contract onboard. He, and his dependents, holding back their expanses during the period of his absence start spending money and the bank balance starts shrinking. After completing contract on a ship, where a seaman remains confined onboard most of the time, he spends without limits and over time the same develops in seaman’s families as well. The Guilt Factor. A factor triggering extra expenditures is the guilt factor. The mariner, not available to his loved ones, tries to compensate his missed affection by ‘distributing’ his earnings. It has been observed that this tendency is very frequently misused by the benefices. The High Salary Structure. Seamen find themselves confident that even if they spend every penny of their income, they would be able to generate more due to the high salary structure at sea. And hence never bother to hold their hand on the expenditures. Inflated Standard of Living. Merchant Navy is a profession adopted mostly by the middle class .Where one finds educated individuals around without the big riches in hand. New entrants in merchant shipping from wealthy family backgrounds mostly do not stick to merchant navy for long time and quit comparatively much earlier as compared to their counter parts from middle class. With the increase in salary as a mariner steps up the carrier ladder, the standard of living gets better naturally. An inflated standard of living, much higher than his ‘near ones’, costs earnings of a mariner and end of the day every one connected to him requires increased share of it. When Will I Get My Next Ship? Uncertainty of job, where one does not know when one will be getting the next ship, after two months or two years. Unforeseen extended stay out of employment eats up all the financial resources. It also hinders one to invest money from where it may not be available at the time of need.

Plan Savings, Plan Retirement.

It is never too late to give your safe future a start, that would certainly bring you peace of mind and safe future to your family. You will be pleased you did it, you saved when you were young and energetic and it was so much easier to put some money aside for the future. The best way out would be to cut of a fixed slice from the salary when ever cash advance or final payment is received. A fixed percentage would be the best choice; however small or large may it be. I would say from 10-25%, the more the better, of the gross income should be saved for retirement so far as the seafarers are concerned. What ever percentage is put aside, consider your salary to be minus this saving; as if it never existed and was not a part of your income. After all, that is how pensions and provident funds are ‘cut’ in the salary slips on the shore! This saving may be put into a safe saving scheme where the actual invested sum remains guaranteed safe, that is, saving certificates, prize bonds etc. Next comes a pension plan and life insurance. Some insurance companies provide policies that combine both above features. Such investments consist of a pension plan or a policy where amount invested plus benefits is returned on completion of the term. The actual sum invested remains safe. Maintaining a insurance policy is like keeping a spare tyre in your car when leaving for a long journey. It brings peace of mind and trust that if anything happens to you your family will be taken care of. I myself, while serving at sea, realised this fact very late but however started to invest in an insurance policy and have never repented it. Only important thing is that one must go for a very reputed insurance company and investigate their previous payment records before making a final decision. Others are investments in real estate, shares and businesses; these are specialised fields and are out of scope for this essay. However, I may add that once you reach the limit of your safe investments you may only then consider investing in risky businesses. Investments in real estate, shares etc. can only work safely when you have a person of trust on shore to invest your money while you are working and earning onboard. These markets being highly liquid, do not allow risk free investments.

Career at sea is a high risk employment.

Working at sea is, apart from all safety precautions taken, a risky employment where the chances of having an accident is much higher than many normal jobs. On oil tankers, even in dry-dock, we routinely hear about people dieing from gas inhalations. It reminds me about a chief officer i heard about , while I was serving as Engine cadet. He had a Master’s Certificate of Competency and was very ambitious. The vessel was in dry-dock. After lunch break this chief officer, company's superintendent and a surveyor went down in a cargo tank. Chief officer was ahead of them all. He suddenly collapsed and the same time the portable gas meter sounded its alarm. Superintendent tried to lift chief officer and started to move up the tank ladder, but collapsed as well.

The surveyor who was still following managed to escape to deck. By the time B.A. parties went down to rescue, both had expired. There are more dangers to life lurking, as compared to shore, while one is serving on a ship, isn’t it. Above is just one accident, many similarly ones can be traced in newspapers and by the word of mouth. Let me remind that on FOC ships, where most of us work, the compensations are not very affective and where they are present, procedures involved are very slow. If you are not doing it already, go ahead and give yourself and your family a safe future. Save – before it is too late.

Nandkishore Gitte.