Non owner pilot question

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evapilotaz

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When you fly the airplane you own do you have a maintenance reserve fund per hour you fly? Meaning you fly 1hr and it cost $50 in fuel alone. Add 10% to that hourly fuel cost and your at $55.00 for fuel plus 10% maintenance reserve fund. How do you know if that 10% maintenance reserve fund is enough. Do you base it on engine time vs overhaul cost? How do you prepare for the expected and unexpected maintence cost? Or do you all have huge bank accounts and
dont give it a second thought?
 
evapilotaz said:
When you fly the airplane you own do you have a maintenance reserve fund per hour you fly? Meaning you fly 1hr and it cost $50 in fuel alone. Add 10% to that hourly fuel cost and your at $55.00 for fuel plus 10% maintenance reserve fund. How do you know if that 10% maintenance reserve fund is enough. Do you base it on engine time vs overhaul cost? How do you prepare for the expected and unexpected maintence cost? Or do you all have huge bank accounts and
dont give it a second thought?
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Nope

I just fix snags as and if they come, got a little moleskin journal with all my short term and long term due items, outside from that, I put gas in and go.

These mx reserves are fantasy, for pt91 you could go well beyond TBO, or your fresh engine could pop 1/3 the way to TBO.

I take care of my aircraft, I'm not ham fisted, I have a engine monitor and know how to make my CS prop, MP and cowl flaps work together, I don't slam my two nose wheels down on landing, or do I side load, I don't slam doors nor do I pull my seat forward by grabbing the glare shield or anything like that, I keep my plane clean and waxed, I use good products on my leather, always survey my landing areas. Just common stuff

This method has been working just fine for me for quite some time.
 
I don't want to factor in fixed cost such as insurance, hanger/tie down fees, and loans if there is one. I just want to factor in the cost to fly fuel plus maintenance reserve.
Thank you
 
I put my hangar, insurance, state property tax and a basic annual ($2,500) into fixed costs. That works out to about $850/mo or so.

I figure 12gph at $5 ($60) for fuel.
I figure $35,000/1400 for the engine since it had 600hrs on it when I bought it ($25)
I figure $8,000/1000 for the prop since it had 1000hrs on it when I bought it ($8)

That is $93/hr plus oil and misc maint. So I round up to $100/hr to fly it. I don't really set special money aside as I know what I can afford to spend on the flying part each month. I could set up a bank account for it and have thought of doing so, but it might be more trouble that it's worth.
 
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I did it when I had a 172, now I just pay as I go.
 
Money is money. I have a bank account where I put money I haven't spent yet. When I need to spend money, I take some out. Having a separate account and keeping track of airplane related expenses would just depress me, so I don't. It's bad enough seeing the fuel charges on the credit card. :)
 
Mistake Not... said:
Money is money. I have a bank account where I put money I haven't spent yet. When I need to spend money, I take some out. Having a separate account and keeping track of airplane related expenses would just depress me, so I don't. It's bad enough seeing the fuel charges on the credit card. :)
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:yeahthat:

Sole ownership for personal travel/recreation is not a business, so accounting is just depressing.
 
Henning said:
I just spend the money as needed and toss the receipts in a file.
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Same here... When I went the spreadsheet route I could see exactly how much I was spending.. I don't use my plane for business so it's a HUGE waste of money - so I'd rather not see how much I really spend...
 
EminiTrader said:
Same here... When I went the spreadsheet route I could see exactly how much I was spending.. I don't use my plane for business so it's a HUGE waste of money - so I'd rather not see how much I really spend...
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Yep, it's pretty irrelevant for pleasure use, same goes for boats. I had one owner who left his Amex Centurion card in my wallet. I kept all the receipts in a cubby for a couple of years until I couldn't fit any more in. I asked "You ever gonna do anything with these?" "Nope, don't want to know." I just quit saving them after that. His accountant paid the bill and all he ever saw was the perks from the money I spent. He said that's all he wanted to see.:lol:
 
Theboys said:
Well that would be a great plan to save the money per hour for repairs and such. I don't know anyone who does though.
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I hear this is how to buy into a partnership. Wait until TBO is almost up. Owner hasn't set aside the cash. Offer to buy in to cover the overhaul. Now you are part owner.

I have now idea of this is smart or not. It's just what someone told me once.
 
evapilotaz said:
Well doesn't most partnerships or clubs do this anyway? Set aside money for maintenance per hour flown?
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Not sure whose comment this is in reply to, but my point was if they weren't a partnership to begin with, not setting aside for overhaul is one way to need to become a partnership.
 
evapilotaz said:
Well doesn't most partnerships or clubs do this anyway? Set aside money for maintenance per hour flown?
Click to expand...

It really depends on the partnership, the contracts are whatever people want them to be. Some have an hourly fund, some are assessments as needs arise.
 
airbrain said:
Not sure whose comment this is in reply to, but my point was if they weren't a partnership to begin with, not setting aside for overhaul is one way to need to become a partnership.
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If one can't reach into their back pocket to cover an overhaul the moment the ink is dry on the new registration, it's not advisable to be an owner.
 
I only count the fuel as an hourly cost. Everything else is just the cost of membership.
 
Yeah, first plane I owned I started a little Lotus123 spreadsheet for mx, and other costs. Like others, I got so scared at the number, I quit keeping track and just fixed stuff when it needs fixing. Money is fungible so what I don't spend on the plane I would spend on wimmin. Either way - it was all spent.
 
I was an equity partner in an aircraft once. Paid $25 hr for reserve. I sold my share but remained not equity, now I pay $35 hr.
 
If you have a financial situation where you could come up 20k in short order for repairs, then there's no reason to put Mx fees aside.

I don't. But I've learned through having my son in private school that it's less painful to me to put aside some along the way and pay it all at once than it is to scramble at the last minute trying to come up with a large chunk of change.

Similarly, when I do own, I will put money aside every flight and pay myself. When the engine needs replacing, I'll have the money. If it doesn't ever need it, then I have a nice windfall.
 
I have no idea how I do it.....

I buy gas....and then when I need parts I buy parts. I just pay the bills as they present themselves.
 
paflyer said:
If one can't reach into their back pocket to cover an overhaul the moment the ink is dry on the new registration, it's not advisable to be an owner.
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This has always been my approach. If I lost an engine tomorrow, I'd pull out the check book and get it fixed or replaced. It would hurt, my pride that is, but not my bank account. Other than that I budget about $15K per year for all things airplane. I've never spent that much in a year and I fly as often, and whenever I can.

No doubt there are many ways to do it cheaper, but this works for me.
 
bflynn said:
If you have a financial situation where you could come up 20k in short order for repairs, then there's no reason to put Mx fees aside.

I don't. But I've learned through having my son in private school that it's less painful to me to put aside some along the way and pay it all at once than it is to scramble at the last minute trying to come up with a large chunk of change.

Similarly, when I do own, I will put money aside every flight and pay myself. When the engine needs replacing, I'll have the money. If it doesn't ever need it, then I have a nice windfall.
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There's nothing wrong with banking back by paying yourself every flight, however that only goes so far when the engine ****s itself 50 hrs into the saving cycle.
 
i happy for you all that can drop $20k on a whim and not think twice about it.
Me raising three kids dropping 20k not being prepared for it will hurt some.
I think that is why so many airplanes gets mothballed because the owners wasn't prepared for that big expense. I don't want to be that person.
 
evapilotaz said:
i happy for you all that can drop $20k on a whim and not think twice about it.

Me raising three kids dropping 20k not being prepared for it will hurt some.

I think that is why so many airplanes gets mothballed because the owners wasn't prepared for that big expense. I don't want to be that person.
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Oh, it's always painful to write the check, but like someone said, expensive maintenance can come up at any time, not just at TBO.

Having partners helps too. I'm lucky to fly 100-120 hrs per year. At that rate, having 1-2 partners makes sense, although admittedly, one of them does not fly that much, and when he does, it's usually just local.


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evapilotaz said:
i happy for you all that can drop $20k on a whim and not think twice about it.
Me raising three kids dropping 20k not being prepared for it will hurt some.
I think that is why so many airplanes gets mothballed because the owners wasn't prepared for that big expense. I don't want to be that person.
Click to expand...

Well, the thing is, that $20k bill can hit on the flight home from the purchase. If you aren't in a position to deal with that, then ownership is a high risk proposition.
 
Question to the new airplane owner.....

Do you want to "learn" (i.e. finan$e) how to care and feed an airplane by yourself?....or with others? I'd highly recommend doing this with a group for the first.....then after a year or two branch off and take your learnings and purchase one. You will make a few bad maintenance decisions that could be costly.....after the second or third plane not so much.
 
evapilotaz said:
When you fly the airplane you own do you have a maintenance reserve fund per hour you fly? Meaning you fly 1hr and it cost $50 in fuel alone. Add 10% to that hourly fuel cost and your at $55.00 for fuel plus 10% maintenance reserve fund. How do you know if that 10% maintenance reserve fund is enough. Do you base it on engine time vs overhaul cost? How do you prepare for the expected and unexpected maintence cost? Or do you all have huge bank accounts and
dont give it a second thought?
Click to expand...
I am sole owner of my plane. Whether I put money into a fund or just pay the mx bill when the work is done, I end up paying the same amount. So it makes no sense for me to maintain a fund, it would just be extra bookkeeping.

It might be different if I had partners, but even then a lot of partnerships simply keep track of hours flown by each partner and assess for work done after the fact based on that.

Some equity clubs compute an hourly rate based in part on historic maintenance costs.
 
evapilotaz said:
Well doesn't most partnerships or clubs do this anyway? Set aside money for maintenance per hour flown?
Click to expand...

Some do, some don't. Some manage it well, some don't. Many just can't seem to resist the urge to raid the "engine fund" to buy the latest, coolest avionics, interiors, paint jobs. I've been looking at existing partnerships for a long time. The recurring theme is one of the partners see's the handwriting on the wall and puts his share up for sale and will flat out lie about it. The best one was "dude, TBO is a recommendation, not a rule. They get 3400 hours out of those Continentals in 182's all the time." This from the guy who talked the rest into raiding the maintenance fund to go Glass in a 182.
 
evapilotaz said:
i happy for you all that can drop $20k on a whim and not think twice about it.
Me raising three kids dropping 20k not being prepared for it will hurt some.
I think that is why so many airplanes gets mothballed because the owners wasn't prepared for that big expense. I don't want to be that person.
Click to expand...

It still sucks writing checks. I remember going to KUBE to get some scheduled work done. Had to leave the plane amd 10'grand and two weeks later got it home. It hurt writing the check. But thats what aircraft ownership is.

I tried to get partners bu never didi find one.
 
luvflyin said:
Some do, some don't. Some manage it well, some don't. Many just can't seem to resist the urge to raid the "engine fund" to buy the latest, coolest avionics, interiors, paint jobs. I've been looking at existing partnerships for a long time. The recurring theme is one of the partners see's the handwriting on the wall and puts his share up for sale and will flat out lie about it. The best one was "dude, TBO is a recommendation, not a rule. They get 3400 hours out of those Continentals in 182's all the time." This from the guy who talked the rest into raiding the maintenance fund to go Glass in a 182.
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Well, in that case, it's "buyer beware". Price it assuming the engine blows up at TBO. If you get more out of it, great, but don't bank on it.


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Thus is life.

Or you could get hit by a bus tomorrow.


Life's a b1tch, and no one gets out alive, just live it up, and don't micro manage crap.
 
Four automatic online banking transfers are performed each week:

Hangar Rent
Annual
Insurance
ADS-B Compliance

These are my fixed costs (I assume ADSB compliance at $x,xxx due in 2020, divided by X number of months until 1/1/2020).

Then, for each .1 hour of flight, manually entered online transfers for:

Airframe ($50/hr)
Engine $25,000 divided by remaining TBO
Fuel (I do just pay this one as-I-go).

I am very pessimistic with my assumptions, so for those that say the engine could blow tomorrow, or 500 past TBO, I have a nice cushion available. The airframe fund is nice for buying STC's or avionics. Anything leftover is gravy. The annual fund, for instance, is already paid up.

This works for me. It may or may not work for you.

PS: This method makes my 60 y/o 150 and 60 y/o 172 seem awfully expensive, but the money is just sitting there for a rainy day, it's not like it's actually spent yet.
 
paflyer said:
If one can't reach into their back pocket to cover an overhaul the moment the ink is dry on the new registration, it's not advisable to be an owner.
Click to expand...


This.

We do have a small hourly engine fund on our "co-ownership of the LLC that owns the aircraft" (gotta keep the lawyers happy...), mostly to even out the engine costs to whomever flew the airplane the most. Which usually is me. And I argued for it.

Reason: We're a very "fair" group and if I put half the time on the engine, I don't want it to become a "problem" later when someone feels stiffed.

We didn't make it high enough to pay for the complete overhaul process and all the new accessories, etc. It'll come up roughly $10-15K short.

On purpose. We all felt we should also all have some skin in the game even if for some reason we weren't flying, when it comes to a major maintenance item.
 
dans2992 said:
Well, in that case, it's "buyer beware". Price it assuming the engine blows up at TBO. If you get more out of it, great, but don't bank on it.


Sent from my iPhone using Tapatalk
Click to expand...

I'm in the market again and I take it a step further. I crunch the numbers assuming the engine is going to the scrapyard the day I buy it. If i can't afford it now, I probably won't be able to a year down the road either. The reserve fund can sit in Interest bearing accounts just as easy that money can sit in my personal Interest bearing accounts. If the engine don't blow then it's all gravy.
 
By the way, I over-analyzed this for months until my wife told me "just buy into the damn thing, you're driving me nuts not flying". Heh. A warning for those who love spreadsheets and planning. Don't over do it.

And yes, I married right. :)
 
I'm a sole owner. When I think about the incremental cost of flying somewhere, I pretty much only consider fuel expenses. I could geek out on spreadsheets and track every expense down to the point that I know exact how much per hour the plane costs.

Of course if I did that, I'd probably fly less, knowing how expensive it is, which would result in even higher variable costs, resulting in even fewer flights...until I stopped flying altogether.

Reality is, even variable expenses aren't variable if the plane never flies. Corrosion from sitting is a bad thing and is difficult to quantify.

I originally planned on having a partner or two in the plane before I bought it. After looking a bit more, the wife in I decided to own it outright without any partners. If finances change and a partner makes sense, then perhaps I'll take one on.

To me, one of the luxuries of sole ownership is not having to obsess over calculating the correct hourly costs. It's a must when two or more partners are involved.
 
Thank you for the comments. Maybe for me it would be best to have a partner or two that is familiar with maintenance and the cost of ownership. I would do owner assist annuals so I can learn more about the machine I'm flying. Right now I just toss they keys to the fbo owner and don't give maintenance much thought. If notice the rental is done for maintenance outside of the 100 hr maintenance I would ask the fbo owner what the reason was/is for the maintence jus for curiosity sake.
 
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