In Japan, fishers plant trees in upstream watersheds, known as “fishery forests,” to improve coastal environments and secure fishery production. Based on observation and experience, fishers have traditionally believed that their practices are fit for their intended purpose. Fishers have found it difficult to continue their practices due to budget constraints caused by a recent decline in coastal fisheries. As such, they are currently faced with the dilemma of deciding whether to restore watershed forests to improve the coastal environments or minimize expenses in an effort to secure financial sustainability. This draws attention to further issues: whether or not fishers can obtain a net return on their efforts, and if so—when. To this end, we examine the economic value of the traditional ecological knowledge using data of terrestrial and aquatic ecosystems in Hiroshima, Japan. The results show that, while fishery forests mostly pay their costs in the long run, the costs are higher than the benefits for the first several years because of the initial costs of afforestation. With the aim of contributing to holistic watershed management, we propose policy instruments that could be employed to alleviate front-loaded costs so that fishers can engage in traditional ecological knowledge-based practices. •Fishers plant trees upstream watershed to improve coastal environments in Japan•Tree-planting pays its cost in the long run but much more front-loaded•Recent budget constraint of fishers makes it difficult to sustain their practices•Holistic watershed management linking land and sea is urgently required•The essence of fishers' knowledge helps us explore such public policy alternatives