How much loan is to much loan?

[tataki]

How much did you borrow to get to your dream job?

How much debt do you think is too much debt to get into the industry?

Regardless of your age, you made it or you did not, do you regret getting in debt for your dream job? Would you do it again?



I think it would be interesting to get opinions, advices from fellow pilots about those subjects.





PS: “if sugardaddy paid for it, don’t answer" )

 

[User546]

I think a lot of it has to do with your personal situation.

Ask yourself honestly, how much debt do you currently have that your paying on? How much room is there in your budget to take on an additional loan?

You have to be completely honest with yourself as well about where you'll be starting in this industry. Once you invest enough money to pay cash for a medium sized home, you have to be at terms that you'll start out making less the guy that'll take your order at Taco Bell (and working more hours). Remember, flight instructors typically only get paid for hours flown, and ground taught. You may be at the FBO all day, but only get paid for 3 or 4 hours tops.

Also, do you have a spouse? If so, there will be no doubt that she'll have to go to work full time to help carry you through atleast the first couple years.

Most people I went to school are now paying back $80,000-100,000 loans - which even on the low side come out to about $600 a month. Think about that $600 a month JUST for the loan payment. That doesn't include your rent, grocerries, gas, etc.

None of us can really tell you how much is too much, its all personal to yourself. However if I had to give you a simple answer with a random figured, that I came up with non-scientifically, I'd tell you never to pay over $45,000.

Going the FBO route that shouldn't be a problem, going the flight academy route, that'll be impossible. Get creative and find some ways to save money (get a training partner, offer to do odd jobs for flight time or fuel, etc.) and do it as cheaply as possible.

Good luck!

 

[Yellow Snow]

The problem people have is they borrow all this money based on what they think they can make. You could loose your medical or some other problem could hurt you. My wife and I saved the money to get my ratings through CMEL in cash. We then took out a second mortgage on some rental property we own for enough to build to about six hundred hrs. This way the renters pay the only debt we have with respect to my flying and I have enough hours to obtain a job flying traffic, pipeline, or some other entry position. I could never have spent the money for one of the academies. They charge three times as much as an FBO or flying club and only guarantee an interview. I have a friend who went the whole academy route and finished up shortly after 9-11 so he got his interview but it was lip service he had no chance at a job. He then had to pay his loans while waiting almost three years for the job market to open up again.

If you go to a bank to get a business loan and you can't show a realistic business plan for gross earnings to be at least half the loan amount per year the banker will laugh at you. I believe you should at least look at aviation in the same way. If you can only expect to make twenty thousand in gross earnings at a regional job you should never borrow more than forty thousand.

I saved for my aviation training for four years before I had enough to do it. Sure I would like to have began my career four years earlier but not at the risk of owing six to seven hundred a month and only earning fourteen hundred after taxes.

 

[tataki]

I saved for my aviation training for four years before I had enough to do it. Sure I would like to have began my career four years earlier but not at the risk of owing six to seven hundred a month and only earning fourteen hundred after taxes.

I think that’s a wise decision.
I am 28 now and started flying 3 years ago just after completing an a.s. in computer science.
I paid as I went to get to my single commercial engine land license. Today I am seriously thinking on getting a moderate loan (about 10000 dollars) and enrolling in the Pace program at Mesa. Before classes start I am going to do my cfi and finally get my multi at mesa with a chance at an interview. I would never do the program without getting something back, and doing the multi there, I think will be a good experience.

 

[User546]

Before classes start I am going to do my cfi and finally get my multi at mesa with a chance at an interview. I would never do the program without getting something back, and doing the multi there, I think will be a good experience.

Be very careful to read the fine print on that one!

Most academies, or "guaranteed interviews" places, almost always require that for you to be eligible for that interview, you must have completed all your training (PPL - CFI) with them and their program before you will qualify to get that interview. I'd be really shocked if a place like that let you only get one or two ratings with them and then give you the interview like that.

If they do say the will, you make sure you get that in writing before you pay any more or begin training.

 

[jaywc7]

RAA does... Infact - you can just do the FOS course and get an interview. My two roommates just got on with PSA and Eagle after being here for a month, and Denver for 5 weeks... It's a guaruntee here for sure. That's pretty much the main thing they pride themselves on here. They couldn't dodge it if they wanted. That's why all of us are here, because of the flexibility...

Oh, and to stay on the topic : I think debt is relative. Besides - what is money really??? There's so much more to life, then owing a bunch of people a bunch of funds stored in some back computer somewhere. I'll pay them back. I'll play the game. Ultimately though - my life is way way beyond money, and always will be...

 

[mayday1]

Oh, and to stay on the topic : I think debt is relative. Besides - what is money really??? There's so much more to life, then owing a bunch of people a bunch of funds stored in some back computer somewhere. I'll pay them back. I'll play the game. Ultimately though - my life is way way beyond money, and always will be...

that can be dangerous thinking.. whether we like it or not, our lives are greatly influenced by bank accounts, credit scores, etc. Someday down the road you may want to buy and invest in a new home/condo/townhome, etc. Good luck with that if you're swimming in debt.. taken a little further, I imagine you'll want to retire someday, or possibly have kids? You might regret the thinking that money doesn't matter.

 

[jaywc7]

that can be dangerous thinking.. whether we like it or not, our lives are greatly influenced by bank accounts, credit scores, etc. Someday down the road you may want to buy and invest in a new home/condo/townhome, etc. Good luck with that if you're swimming in debt.. taken a little further, I imagine you'll want to retire someday, or possibly have kids? You might regret the thinking that money doesn't matter.

I realize that... You are right of course, and make a reality point for sure...

The truth is that, yes of course I'm planning for the future. I do want to be settled, finacially secure, have a family, and all that - absolutely. I'm well aware of the consequences of poor finacial management, and try my best, despite my habits, to do the best I can.

However... The bottom line for me remains : "Money is NOT my life!"

As I wrote farther up, I WILL play the game, and stay within the limits of reality. But it will always be nothing more then a game to me... You can't buy happiness, no matter how much they advertize that you can!

No worries though - we're all working hard, and we will all succeed somehow or another.

 

[sandslob]

It's only money... fly becase you want to! Money is easy come.. and (as I'm finding) easy go! No matter how much you save it all goes.. but it's SO worth it!

 

[Goose Egg]

How much did you borrow to get to your dream job?

Well, I don't have the "dream job" yet, but I borrowed about $18K to get to where I am. I consolidated, and payments are about $130/month. I also lucked out and got a pretty good instructing job with benefits. They also paid for my CFIG, and will pay for my MEI. They also would have paid for my CFII if I didn't already have it. When I start my MBA in the fall (which the school is paying for), I'll be eligible for deferment on the loan payments for a couple years.

Something that helped me keep my flying ultra cheap: I went to a local state college and lived at home. I was 24 when I started flying in earnest (although I already had about 125 hours at the time), which means that my parents couldn't claim me as a dependent for tax purposes. Therefore, I was considered quite poor for by tax standards and since I was attending an accredited 4 year school was eligible for pell grants. Tuition was only around $1200 per semester, so I had a lot of my grants left over to fly. In essence, the government payed for a pretty good chunk of my flying.

Also, the school had some pretty economical rates. If I remember, a Katana was $69/hour. Dual was $25. I split a bunch of time in a Cherokee 140 which ran about $55/ hour, so when I was splitting time it was $27.50 per hour!!

When I hear about how much other people spent, I feel like I made out like a bandit.

How much debt do you think is too much debt to get into the industry?

Spend as little as humanly possible without compromising the quality of your training or subjecting yourself to poor maintenance standards. Remember, you've got to pay it all back. Do what you can to minimize the amount you borrow.

Regardless of your age, you made it or you did not, do you regret getting in debt for your dream job? Would you do it again?

No regrets other than I wish I had done what I did sooner without trying out all those other majors when all I really wanted to do was fly.

-Goose