Buying a aircraft you can't afford.

brien23

brien23

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How many pilots buy a plane not knowing or not understanding the true cost of owning a plane. I believe most pilots want a safe and reliable aircraft to fly and for the people with them. In pilot training no one ever gets the training on aircraft ownership, true cost or even know how much a tire or a spark plug cost. Those that can afford a nice plane probably have the money to maintain the plane, this is about the other 90% who can't.
 
brien23 said:
How many pilots buy a plane not knowing or not understanding the true cost of owning a plane.
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I think that percentage sits around 30-40% of the recreational owner base who have minimal knowledge of ownership costs or requirements. The top 30% of owners tend to be more knowledgeable plus maintain their aircraft at a much higher level. And the middle percentage group are a mix of the other groups with some becoming more engaged with aircraft ownership as time goes to include a few who make it into the top 30% group.

But I think its not strictly a money issue that dictates this trend and also is driven by a persons subjectiveness or personality. Have seen a number of “rich” owners operate in the lower 30% group and few “poor” owners in the top group.
 
Know of a partnership where one guy couldn't keep up with the engine/maintenance fund on one. Then bought another with the idea his kids would learn in that one. Didn't happen. Partner bought him out and the other plane was thrown in for the non payment of engine/maintenance fund.
 
Doc Holliday said:
A large percentage of GA pilots. This is one reason a large portion of the GA fleet is in deplorable condition.
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It's going to get even worse. A lot of people (pilots and non-pilots) bought GA planes with their "free" money and now they're figuring out that it's not that easy to upkeep, maintain, store. It requires time and commitment. Some also realized that they're not that much into it and the novelty of "Hey I have an airplane" bragging is wearing off. At the same time they absolutely refuse to sell under 130% of what they paid for it.
 
I consider myself fortunately to have been a member of a flying club (and eventually maintenance manager for one of the planes) and a member of a partnership before buying my own plane. Learning from other members was not only good education for maintaining a safe airplane but also for setting expectations, dealing with shops, navigating the parts supply chain, etc. I can't imagine how expensive it would have been to jump in blind.

I suspect a lot of owners on the margin loose confidence in their planes when they're unable to keep up with maintenance expenses and the planes fly minimally, even if they do pass their annuals. Based on anecdotal evidence, many of these planes changed hands in the 2021-2023 timeframe, keeping A&Ps real busy getting them up to snuff.
 
One of my favorite sayings is that buying a plane is a lot like earning another rating. There's so much to learn about where to get service done, upgrades, even just where to find parts. ADs, SBs, 337s, logbook entries.... it's a lot. One of the online ground school companies ought to make a course. Of course, pilots would be too cheap to pay for it. Like Brad said above, being involved in a club beforehand can help a lot.

I thought i was very prepared for ownership, then my plane laughed at me. I've essentially had to buy my plane twice. Thankfully I don't think that's the norm, but it is a possibility. Luckily in my case the hull value also nearly doubled in that same timeframe, so I'm not tooooooo far under water. Being able to write a check tomorrow for a new engine is really where you need to be.
 
It’s very common for people to buy way more house than they should and finance it to the point it’s over twice the asking price once things are paid off

Even more people have kids before they are even established in their careers

So buying a 30-80k plane isn’t really that bad
 
the issue is that they cant afford to write the check when something that requires it to happen. too many buy just under the assumption that "it wont happen to me" and thats the problem. i think any plane that anyone buys - you better have enough to stroke the check for an engine (or two for a twin) - and that determines whether you can afford it. This also applies to turbines as well. But at any given time, if you can stroke the check for a new/overhauled engine - then you're probably adequately covered.
 
No idea on the percentage. Plane ownership is not fundamentally different than boats, classic cars, or some houses. A plane is not an ideal impulse buy, I usually recommend people start with a club or partnership where you can share the learning curve with others.
 
brien23 said:
How many pilots buy a plane not knowing or not understanding the true cost of owning a plane.
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Almost every first time buyer fits in this category. There are exceptions to every rule, but generally speaking aircraft ownership is something that has to be experienced to be understood.

After you become an owner, financial situation and personal traits determine which of Bell206's three groups you grow into.
 
Bell206 said:
I think that percentage sits around 30-40% of the recreational owner base who have minimal knowledge of ownership costs or requirements. The top 30% of owners tend to be more knowledgeable plus maintain their aircraft at a much higher level. And the middle percentage group are a mix of the other groups with some becoming more engaged with aircraft ownership as time goes to include a few who make it into the top 30% group.

But I think its not strictly a money issue that dictates this trend and also is driven by a persons subjectiveness or personality. Have seen a number of “rich” owners operate in the lower 30% group and few “poor” owners in the top group.
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One way to look at it would be to categorize owners by 2 characteristics: willingness to learn, and willingness to spend. That yields 4 combinations. 3 groups can be successful owners. The one to watch out for are those who are unwilling to learn AND unwilling to spend.
 
I don't like to call aircraft ownership a hobby. IMO if you treat it like a hobby it's going to kill you. For me, it's a passion.

A lot of folks buy a plane like they buy a boat (hobby). There are similarities, but it's not the same thing. A boat is far less likely to kill you and your passengers with poor maintenance or poor skills. Ignoring your plane for 3 months is a much worse problem than ignoring the boat. They both are going to cost you, but the plane is far more likely to kill you if you do that. To be a good aircraft owner you have to be the type of person that thinks about flying even when you aren't flying. JMO
 
the problem is people seriously underestimate what it costs per hr to fly their plane. with the cost of engines nowdays, the old 4x fuel costs just doesn't cut it anymore. for the T-6 i figure at minimum 500hr to operate it, probably closer to 750. for a simple O-320 you had better budget at least close to 50 Hr just for engine reserve nowadays.
 
Salty said:
I don't like to call aircraft ownership a hobby. IMO if you treat it like a hobby it's going to kill you. For me, it's a passion.

A lot of folks buy a plane like they buy a boat (hobby). There are similarities, but it's not the same thing. A boat is far less likely to kill you and your passengers with poor maintenance or poor skills. Ignoring your plane for 3 months is a much worse problem than ignoring the boat. They both are going to cost you, but the plane is far more likely to kill you if you do that. To be a good aircraft owner you have to be the type of person that thinks about flying even when you aren't flying. JMO
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True. Much like auto racing. Racing's also a hobby, but it requires a tremendous level of commitment. For the time I was doing it, I pretty much immersed myself in it, which was the only thing that let me grit my teeth and spend the money it took. I can't imagine trying to do both at the same time, but I knew several people who did.

Now I'm writing large checks to OH my O360. It's painful, but not totally unexpected, and I had funds to cover the possibility before I bought the plane. Or, for a different way of looking at it, I bought less plane than I could have in order to have the necessary contingency fund.

Ed Haywood said:
The one to watch out for are those who are unwilling to learn AND unwilling to spend.
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One would like to think Darwin would take care of that category, but unfortunately it's often the next owner who bears the consequences of the previous owner's neglect.


unsafervguy said:
the problem is people seriously underestimate what it costs per hr to fly their plane.
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This is true, but there's really no reason for it other than wilful ignorance. It's not that hard to become informed if a prospective airplane buyer wants to learn.
 
eman1200 said:
don't buy things you can't afford. shouldn't be a difficult concept, but it is.
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You're right, of course, but we do live in a debt-ridden, buy now / pay later sort of society, with lots of envy and a yen for instant gratification. That problem is much bigger than airplane owners.
 
Half Fast said:
You're right, of course, but we do live in a debt-ridden, buy now / pay later sort of society, with lots of envy and a yen for instant gratification. That problem is much bigger than airplane owners.
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that's why I said don't buy "things" you can't afford.
 
I have great sympathy for those trying to make the numbers work. We've all been there, dreaming of owning our first plane, but trying to balance a limited budget. It's human nature to shade the assumptions a bit on the low side, especially if spousal approval is necessary. Hope springs eternal.

But buying your second plane, after going through the school of hard knocks, there's no excuse for not knowing what you are getting into.

That's why clubs and partnerships are such a great option for your first rodeo. Dividing a worst case surprise 3 or 4 ways is way less catastrophic than shouldering it yourself.
 
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Ed Haywood said:
Very true. And often it is a young first-time buyer who thinks he has found the bargain we all dream of.
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Well, that's a pretty good description of me, but I still think I found a bargain. While I had hope for the engine, I didn't have an expectation that it would go for a long time so I held onto a good contingency fund. No regrets about the purchase.
 
Not knowing what the costs would be put me in a “simple” first airplane…no retractable gear or controllable prop. An estimate of what an annual would cost, along with insurance and hangar, was what I determined it would cost to own it, plus the cost of fuel, oil, and some maintenance to fly it. It put me into peanut butter and jelly more than once, but being single at the time, it wasn’t a problem. After a few years, I upped the ante and bought a Staggerwing project, and almost tripled my annual airplane budget.

Acquisition of a family changed the picture, but loss of my job and a move to where I didn’t have the luxury of inexpensive storage and a place to work on the Staggerwing project ended airplane ownership for me.
 
This thread is gonna throw its own shoulder with the amount of self-patting going on. I don't put too much stock on cost preparedness finger wagging from people who haven't had to cut checks for an entire engine as sole owner, after 2020. To wit, I wouldn't take advice from myself as a 2013 aircraft buyer.

I also don't know what being a 1st time owner has anything to do with nominal cost burdens. Being a second time owner doesn't change the sole-owner cost burden if and when it happens to you. If the implication is that the second time owner is older and richer, ok that may or may not be true. My ability to afford the hobby has decreased in inflation adjusted terms since both my personal overhead (work commute/work housing) and inflation proper increased, even though I make more money in nominal terms than in 2013.

If I wanted to deal with TW I could go and buy an RV-4 right now at list price, and get back in the game. But the engine situation has changed the value proposition dramatically. Y'all need to stop lumping everybody critical of the hobby cost basis as a broke out-grouper. I know some mean well, but step back and read how elitist this place comes off as, it's a big blind spot.
 
Ed Haywood said:
One way to look at it would be to categorize owners by 2 characteristics: willingness to learn, and willingness to spend. That yields 4 combinations. 3 groups can be successful owners. The one to watch out for are those who are unwilling to learn AND unwilling to spend.
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I’ve found it starts with one category, someone who wants to be engaged in aircraft ownership. Once those kinds of owners are separated out then I believe it fits the grouping you mention. And when I did run across those engaged owner types, which included some 1st time buyers, I would go out of my way to help them continue on their path. The best part is any person can become an engaged aircraft owner if they so choose.;)
 
I was brought up to 1) live below my means and 2) if you can't pay cash, you don't get to buy it. The house, of course, isn't in the 2nd category. Being in software in the aerospace industry can be "interesting". I also have a very low threshold of boredom. When my sole responsibility at work is twiddling my thumbs and billing time, I leave. I've been thru 7 companies either went out of business (including 2 major computer companies) or were gobbled up. I left Exxon, Raytheon & ULA of my own volition, I was bored out of my mind. Teaching at the university, has been my most consistent job (20+ years as adjunct). Hence when I don't have a steady engineering job, I can still afford the cherokee. One part-time semester at the university pays for the cherokee - hangar, insurance and annual for the entire year.

I paid the house off in 7 years (of a 30 yr mortgage; I'm a very expensive engineer when working), and paid 50% of the airplane in cash back in 2000 with my original partner. When partner died (not in the airplane, medical issues), I paid off the rest of the cherokee, so I have no long-term debt, only the regular monthly bills. The most expensive monthly bill I have is the hangar rent altho the HOA at the house is rapidly coming close.

Do I want a faster airplane? Of course, most of us do. But I don't need it. If I'm going more than 750 miles, I'm flying commercial. It's faster, cheaper and lots safer (I have no illusions) because I'm not instrument rated.
 
Brad Z said:
I consider myself fortunately to have been a member of a flying club (and eventually maintenance manager for one of the planes) and a member of a partnership before buying my own plane. Learning from other members was not only good education for maintaining a safe airplane but also for setting expectations, dealing with shops, navigating the parts supply chain, etc. I can't imagine how expensive it would have been to jump in blind.

I suspect a lot of owners on the margin loose confidence in their planes when they're unable to keep up with maintenance expenses and the planes fly minimally, even if they do pass their annuals. Based on anecdotal evidence, many of these planes changed hands in the 2021-2023 timeframe, keeping A&Ps real busy getting them up to snuff.
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I was a treasurer for a flying club for 12 years. I saw the monthly cash flow and yearly $50K cash flow for all that time. Knew what I was getting into when I bought my first plane.
 
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brien23 said:
How many pilots buy a plane not knowing or not understanding the true cost of owning a plane. I believe most pilots want a safe and reliable aircraft to fly and for the people with them. In pilot training no one ever gets the training on aircraft ownership, true cost or even know how much a tire or a spark plug cost. Those that can afford a nice plane probably have the money to maintain the plane, this is about the other 90% who can't.
Click to expand...
So very true! Every week I get a phone call "I am looking at buying a Super Viking, what can you tell me?". My first response is to emphatically state that whatever price they pay for the aircraft, they better have funds equal to or more than the purchase price to invest in maintenance in the near future. And then a healthy budget for ongoing maintenance. A few heed this advice, many do not. But when they come to my shop for service or an annual and I give them an estimate of $20 or $30K or more I remind them that this was what I told them up front. General aviation in the USA is a magnet for those that have the dream of aircraft ownership but do not have the means to responsibly fulfill this dream.
 
MauleSkinner said:
Acquisition of a family changed the picture,....
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See, this is the root of the problem. Misplaced priorities. The real issue is pilots acquiring spouses and families they can't afford. That gets in the way of buying and maintaining an airplane.
 
Rob58 said:
So very true! Every week I get a phone call "I am looking at buying a Super Viking, what can you tell me?". My first response is to emphatically state that whatever price they pay for the aircraft, they better have funds equal to or more than the purchase price to invest in maintenance in the near future. And then a healthy budget for ongoing maintenance. A few heed this advice, many do not.
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People would ask me about buying a such-and-such airplane. Usually something older. I always told them that "there is no such thing as a cheap old airplane." Somehow they think that because they can get that Viking for $35K, the parts and labor will also be cheaper. My employer often asked those folks if the parts and labor for a 1975 Ferrari were cheap and readily available.
 
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