Key Bank loan

[SteveC]

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Ok and I understand that, but what are people supposed to do? I know I couldn't drop 50 grand to learn how to fly.

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People would be amazed at what hard work, frugal living, and delayed gratification can do to build a bank roll to pay for things they really, really want. Unfortunately we are a society that teaches instant gratification, buy now - pay later, and living life in debt are all good things. I happen to disagree.

I know.....I'm weird.









edited to add: adreamer describes exactly how I did it. Worked a full time job, flew weekends and evenings, cut way back on my other expenses, put every extra penny into flying, and walked away at the end of training not owing a red cent to anyone. Took me longer, but it sure beats 10 years of loan payments. Maybe someone else would split the difference, for example get through commercial, multi while working full time, then taking a (very small) loan to crank through the CFI courses. There are lots of ways to skin the cat (sorry Kristie!) without "owing your soul to the Company Store" (old, old song reference).

Mixed metaphors aside, my personal opinion is that an extra year or two to reach my goals is worth not living on a financial knife edge.

[Texguy]

I guess your advice applies to 29 year olds like me, SteveC? I've been thinking that I need to hurry and get the rest of my ratings if I'm ever going to become an airline captain.

[SteveC]

19 or 29, can't see that it makes much difference. In fact, you should be in a better position at 29 (i.e. more earning potential) to build the flight training fund faster than a younger person, no? If you have a wife and family depending on you, even more reason not to be in huge debt on a limited income, I think.

I was in my thirties before I learned to fly. At that time, I didn't have any aspirations of doing it as a career, I just wanted to fly. Now here I am, ten+ years later, working full time as a pilot and having a blast. I'll never be an airline pilot, but that kind of flying never interested me anyway. Maybe that means that my advice in this area doesn't fit your situation exactly, but I'll stand by my firm beliefs that debt is a killer.

Hang on while I go on another one of my "Debt Rants"

Debt is a never-ending spiral downward for far, far too many people. I know doctors and lawyers that make more than airline captains, and if they ever have a glitch in their life (out of work for medical reasons, car accident, whatever) the debt that they have piled up will quickly drive them into the ground. Granted, they live in very nice homes and drive very expensive cars, but the frowns that I see on their faces when they talk about finances, well, they have headaches that I don't want.

I certainly have no problem with wanting and owning nice things. I do have a problem when people who should be rich get upside down on car leases or loans, have two mortgages on their high 6-figure home, and have 5 credit cards maxed out to pay for the month long vacations in Europe and fancy home furnishings. Yeah, they can afford all those payments now, but what if something happens?

What does that have to do with our discussion? Simply that those doctors and lawyers that are in debt learned those money management skills very early on.

Here's the scenario for the doctor:
1. Huge loans to get through med school.
2. Credit card debt to cover the incidentals.
3. Car loans to buy a nice vehicle instead of driving a junker.
4. Graduate, become an MD and start making some real money.
5. Rather than pay down the loans they have, their income rises to a level that they can afford fancier cars (leased of course), and a bigger house (with a bigger mortgage) and some nifty remodeling (second mortgage), and nice furnishings (on the credit cards, of course).
6. The need for more and belief that *things* will make them happy drive them ever onward, never catching their breath and working out of debt. Just keep adding more because "they deserve it" and "they can afford it".

I wonder if any of the mainline pilots on this board have seen airline captains in the same kind of situation?

As far as your particular situation, who knows? How many people that want to be airline captains end up not making their goals, usually through no fault of their own? You have to be in the right place at the right time to make it to the high paying jobs in this industry. Take a good hard look at everything that is going on right now with all the shake-outs in the Regional and Major airline ranks. Can you imagine being a 5th year pilot at a regional, finally making enough money to start paying down your flight training debts, and get furloughed? I'd sure rather not have that additional $500 or $800 monthly payment hanging over my head at that point.

I'll say it again, though, that I'm weird. I'm in the minority in this country on this topic. People all over think nothing of owing money on practically everything they "own".

[adreamer]

I agree with Steve partially. BTW, how's flying out of Holland?(According to John, you and your wife are party animals )

However, I look this loan for flight training slightly different than SteveC. I called it investiment. You have "the potential" to pay it back completely without breaking your back. However, there are some risks as SteveC mentioned. Whether or not you want to "gamble", you have to decide.

Other things SteveC and others said it before on the forum, let me sum it up - Money management and lifestyle. A good money management will get your bank account in a good shape. Lifestyle - not living beyond your means / earnings, it would also get your bank account in the black.

adreamer

[SteveC]

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.... BTW, how's flying out of Holland?(According to John, you and your wife are party animals )


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(You guys are going to ruin my reputation..........awww, never mind.)

[Texguy]

Good points, Steve.

[jtrain609]

Steve and his wife are the shiznit, hang out with them if you can!

Be real careful with the debt thing. Look at this for a moment, and this is in my opinion being fairly optimisitic.

You get a job flight instructing after you drop loads of cash on flight training. Let's say you're making $15 an hour, which wouldn't be too bad with being a flight instructor. Let's say that you're flying an average of 70 hours a month, which wouldn't be too bad if you instructed in a place like Michigan where I'm from.

That would mean that you're taking down $1,050 a month from flight training. Let's say you're a true player and you're doing an additional 15 hours of ground school per month. That means an extra $225 in your pocket every month. So you're making $1,275, or $15,300 a a year.

But that's not a real $15,300 a year. I don't know what you'd have to take out in taxes, but let's just estimate and say you'd take home an easy $12,000 a year because the math is easy.

So let's say you start instructing in Michigan in December. You are only flying 30 hours a month because of the weather. You're paycheck just got dropped to $450 for the entire month because of bad weather. Let's say you're paying $400 in rent with utilities (it gets cold here in the winter and you don't want to freeze), and this is even with a room mate.

That means that in December you've got $50 to buy food, gas, women, whatever you like to do. Oh and you're loan payment! I almost forgot about that. Maybe you can call up Key Bank and let them know that you can't work much right now. They'll understand...right?

Sorry, not worth it. The $200 or so a month in loan payments I'm going to be making almost sounds like too much. And I'm pretty lucky as I don't have a car payment, no debt from college and no credit card debt.

Ya'll better be thinking about this stuff from a realistic strandpoint because most flight instructors don't make that much cash. Sure you hear about the guys that are on salary and can make $25,000 in any given year, but those jobs are few and far between. You better be ready for the lifestyle that's about to slap you in the face.

[IndianaPilot]

FarewellBooth, yep i'd say airplanes do make some people crazy. Yes, me and my dad both understand the risks fully. My dad wants me to achieve this goal almost as much as i do. It's good to have him on my side, and trying to help any way that he can. Are you saying because it's risky we should not proceed ?? Think about the tons of proffesional pilots working right now....because they stepped out and took a risk...just like many of us are about to do. If i dont go forward.....years down the line...i'd be questioning....what if i did ? where would i be right now ?? would have i made it ?? Only way to know for sure is to try it.

[Flight11]

How true it is!!! No one wants to look back 80 years down the road and have regrets (especially a regret of this magnitude)!

[jtrain609]

You know not everyone that made it to the airlines did it with buttloads of debt, right?

[SmitteyB]

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You know not everyone that made it to the airlines did it with buttloads of debt, right?

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The people that didn't must have had rich parents, or a really high paying job...in that case they're most likely 30+. I would venture a guess to say 98% of pilots working in the regionals now are all paying off loans, etc...

I don't think you should hold back on your dream as I said before, it might be hard to pay it back, but it can be done.

[IndianaPilot]

Very good point Smittey !! What are new lawyers doin ?? paying off law school loans......doctors...med school loans....pilots...flight school loans. I dont see it being different than any other career training.

[jtrain609]

Ya'll really have tunnel vision here.

What do doctors and lawyers make right out of school? Go ahead, look it up; it's a lot more than pilots do and pilots make a LOT less money.

[IndianaPilot]

i just picked doctors and lawyers as an example. i'm just sayin in general.....everybody in their life at some piont has to pay off school loans. even me as a paramedic/firefighter.....i had to pay off loans for that even....the medical training and stuff.

[jtrain609]

I feel like I'm talking to a wall with ya'll two.

Let me try to put this into perspective; would you EVER take out a $50,000 to train to be a pizza delivery guy? What if it's been your dream your whole life and that's all you wanted to do? You'll just deliver a lot of pizzas and hope that there isn't a blizzard all winter so that you can keep delivering those pizzas. If things work out just perfectly and nothing bad happens, you're in the clear!

Dosen't that sound crazy? It is, but it's no different than this situation because a pizza delivery guy will probably make more bank driving around large supreme pizzas than you will flight instructing.

You shouldn't let your dream hijack your financial future or it will probably turn into a nightmare real quick.

[jtrain609]

Oh and BTW, not everyone that furthers their education has to take out loans. Almost no one that gets a masters degree or a PhD in the humanities pays for it. University's offer assistantships to something like 80% or more of their graduate students so they're not paying anything to be there. The only investment they make is in time.

And a dude with a masters degree in english is still going to make more money than a flight instructor, AND come out with less/no debt.

[SmitteyB]

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I feel like I'm talking to a wall with ya'll two.

Let me try to put this into perspective; would you EVER take out a $50,000 to train to be a pizza delivery guy? What if it's been your dream your whole life and that's all you wanted to do? You'll just deliver a lot of pizzas and hope that there isn't a blizzard all winter so that you can keep delivering those pizzas. If things work out just perfectly and nothing bad happens, you're in the clear!

Dosen't that sound crazy? It is, but it's no different than this situation because a pizza delivery guy will probably make more bank driving around large supreme pizzas than you will flight instructing.

You shouldn't let your dream hijack your financial future or it will probably turn into a nightmare real quick.

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What is the intention of your posts? It's almost like you're detering people away from aviation careers...

It's peoples DREAM, it's what they have always wanted to do, and to say "Don't do it because you'll only be making $13,000 as a flight instructor" is just disheartening.

One of my old flight instructors is working at Piedmont with $50,000 in loans out, making $24,000 as a first year FO, and not having a problem, so it can be done.

If it's your dream, you will find a way to make it work

BOTTOM LINE.

And that's not always true about doctors, while they're residents and not technically "In School" they don't make jack either.

Indiana;
You will get your money, you will get your ratings, and you will pay off the loans while working at a regional. It has been done before, and JohnH is giving you his far left opinion...

[jtrain609]

I'm going to try to make this as clear as possible; I am not trying to deter anyone from their dreams. In case you didn't notice, I'm after the same goal myself. All I'm trying to do is caution people about acting extremely inmature (finacially) about this. You've got to be honest with yourself about being able to pay back loans. Looking at someone else and saying "they did it, so can I!" isn't good enough. That's about on par with what an 8 year old says to his parents when he gets in trouble.

And if a dose of reality is disheartening then maybe you should figure out if you really want this or not. You're going to run into a lot of hurtles in your career and it better all still be worth it.

Furthermore, this is an extremely CONSERVATIVE view of this, not leftist. I can't believe that a 22 year old is the one telling ya'll this too. I should be the one that says "Go for it! Worry about it later!"

Smitty, you specifically have some growing up to do before you're ready to make that loan payment man; though I don't think your going to get much of a chance to make that happen before the bank comes knocking on your door for their cash.

[Flight11]

!!!!

[IndianaPilot]

Well said once again Smittey !!
JohnH you have some very good points, and i understand what your saying. In a nutshell your saying not to get overloaded in debt with loans, while headed to a career that pays so very low. So basically your saying do it without loans. Well...if you know a way to pay for somethin so expensive as flight training and ratings without taking out a loan...i'm alll ears !! What is the answer then ????? I dont have that kind of money sitting in some savings account, or education fund. Neither do my parents....so whats the answer ????

[jtrain609]

To quote SteveC from above

[ QUOTE ]


People would be amazed at what hard work, frugal living, and delayed gratification can do to build a bank roll to pay for things they really, really want. Unfortunately we are a society that teaches instant gratification, buy now - pay later, and living life in debt are all good things. I happen to disagree.

I know.....I'm weird.









edited to add: adreamer describes exactly how I did it. Worked a full time job, flew weekends and evenings, cut way back on my other expenses, put every extra penny into flying, and walked away at the end of training not owing a red cent to anyone. Took me longer, but it sure beats 10 years of loan payments. Maybe someone else would split the difference, for example get through commercial, multi while working full time, then taking a (very small) loan to crank through the CFI courses. There are lots of ways to skin the cat (sorry Kristie!) without "owing your soul to the Company Store" (old, old song reference).

Mixed metaphors aside, my personal opinion is that an extra year or two to reach my goals is worth not living on a financial knife edge.


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[SmitteyB]

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To quote SteveC from above

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People would be amazed at what hard work, frugal living, and delayed gratification can do to build a bank roll to pay for things they really, really want. Unfortunately we are a society that teaches instant gratification, buy now - pay later, and living life in debt are all good things. I happen to disagree.

I know.....I'm weird.









edited to add: adreamer describes exactly how I did it. Worked a full time job, flew weekends and evenings, cut way back on my other expenses, put every extra penny into flying, and walked away at the end of training not owing a red cent to anyone. Took me longer, but it sure beats 10 years of loan payments. Maybe someone else would split the difference, for example get through commercial, multi while working full time, then taking a (very small) loan to crank through the CFI courses. There are lots of ways to skin the cat (sorry Kristie!) without "owing your soul to the Company Store" (old, old song reference).

Mixed metaphors aside, my personal opinion is that an extra year or two to reach my goals is worth not living on a financial knife edge.


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Even though I'm sounding hippocritical...

Just because it worked for someone, doesn't mean it works for others...

With that being said, because I haven't had to pay it back yet, I shouldn't be giving advice to you Indiana, but follow your dream, and don't let money get in your way, that is about a low as you can get because YOU WILL end up wondering "Where would I be if I had done it"...

And also with that JohnH, you, like me, have no experience, with the loans while instructing/FO, so I think we should both settle down.

Indiana, you're lucky...You have a backup, which most dont have...you have a skill to work while training, and that can work to a major advantage. I...being 19 don't. I am a 19yr old student, who will begin working on a B.A in Homeland Security, and besides working at a driving range, I cannot get a job to PFT.

Good luck, don't let your dream out of your sight, it's doable, and just remember, anything worth having is worth working hard for...

[Maximillian_Jenius]

John if it's any consolation I totally understand what your trying to convey here!



-Matthew

[jtrain609]

Your right, I don't have any experience with this stuff; but I have the forsight to realize it's going to suck making a loan payment. And think about it, I'm only taking out a little over $20,000. That loan payment is NOTHING compared to yours.

You know what Doug made his first year instructing? $8,000 a year. If you make $16,000 you'll be doing alright for an instructor. To be honest this hasn't been one of the rants of the forum latley, we've been focused on PFT lately. But not too long ago the big deal was don't get in over your head in flight training debt because it holds you down to jobs that pay enough to pay the bills which prevents your mobility so you can't move to where the good jobs are at when you have the hours.

I just think a lot of people around here are not thinking about the future with this stuff. You're saying "Oh yeah, big loan....airplanes.....*drool*." There are people that are getting completely blinded by their dream of being a pilot and are willing to do whatever it takes to make that dream come true. That's great that you're willing to do whatever it takes, but obviously some of ya'll are NOT willing to do whatever it takes because you're taking the loan out to begin with and not pursuing other options. I say that from the basis of ya'll attacking, ignoring or simply having no clue about the other options. I've got zero debt up through 200 hours of flight time and an instrument rating (oh, and I did it in the cold frozen expanses of Michigan too) and now I'm taking out a loan to finish the rest of it, albeit a tiny loan compared to what some of ya'll are taking out.

I just want to see people think thing through instead of being blinded by new Cessna's and shiny pilots certificates. So far I have seen no one lay out their plan for repaying the loan. All I've heard is "I'll make it work." That's great, so what's your real plan?

And to be real honest, I'm busting hardcore balls here, but I see some things getting away from a few people here. If I have to stand up and be the adult around here when I'm only a kid myself then that's fine, but holy balls guys you need a plane A, B, C and D. If I loose my medical or hate the instructing thing I can use my degree to do something else and pay off this loan no problem. What can the rest of ya'll do?

[jtrain609]

And now a quote from Doug, today, in another thread:

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Flying airplanes is cool, yes, but paying your bills on time and being around to hang out with your family is cooler.
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