I'm a 50% captain and won't break 400k this year. So we've lost to inflation since 1986!

 

My response was completely irrespective of pilot anything.

If you are a top 2% earner, in one of, if not the richest countries in the world, complaining that you don’t “make a lot of money”, I submit you need some perspective.

That’s not to say we pilots don’t warrant a raise, nor that historically there have been really some hard times. But in the end, I think you’ve lost touch if you don’t think $240,000 annually “isn’t a lot of money”.

I think you also missed the context around his claims around how long it took him to captain, juxtaposed with his statement about what does not constitute “a lot of money”.

 

Top 1 percent floor is $819,000 per year
Top 5 percent floor is $336,000 per year
Top 10 percent is $168,000 per year

$240k falls somewhere between 5 and 10 percent. Not 2 percent. Things have changed due to Covid and not having a POTUS. Your information is outdated. Minimum wage is $20 per hour in some states. 2 workers making minimum wage top $80,000 per year these days. That’s the floor for 2 full-time workers.

 

Ok, fine. I guess my Google-fu found an outdated WSJ calculator.

My point remains, while I would agree with you that $20k/month definitely ain't what it used to be, $240k/year is still a lot of money.

 

This has been interesting. Conversations between me and my wife have gone along the lines of:

Her: If you told me back in college (90s) we'd be making what we make ($360-370 this year. 80% ER Captain, live in base, did $467k last year being a GS Ninja) I'd wonder how many motocross tracks we own and how big the mansion is.

Me:
If you told me we'd pay over $1M for a house I'd ask how many motocross tracks are on the property and do I have an indoor arenacross track, and how baller is the pool?

In reality, while we make good money, my dad was able to swing a similar house, on a lot more land the same distance from BOS as I am from LGA as a truck driver.

We (legacy pilots) have good paying jobs. But housing has vastly outpaced wage inflation. That's my single biggest bill.

1979 dad buys a large Victorian in good shape, albeit last updated in the 30s, for $69k. On 40 acres. With a carraige house and barn.

Based off CPI inflation that would be $298k today.

You aren't buying that house for under $1.4M if it still had the acreage. Owners after my parents sold off all but 2 acres. It just sold last year for $988k.

 

IMO one of the biggest divisors between the haves and the have nots for a long time to come will be those who already owned a home in 2020. Most homes near any of our bases have doubled in price in the past 5 years, combine that with the stark difference in interest rates compared to what we have now, the mortgage payment on the same house could easily be about 3x what it was 5 years ago. It’s insane how much that one thing affects your life.

 

Yeah. Honestly that kind of have and have not disparity might become a huge issue in America is it hasn’t already. Home ownership has always been the path to the American Dream and I feel that’s not good for societal stability if that’s unattainable for more and more people.

but eventually market forces dictate that people are eventually going to have to lower their asking price when selling a home, and current owners are just going to have to stomach not getting an absurd return on their house when they want to sell it?

Has anyone seen home prices decline the last couple years? I’m toying with the idea of moving north of NYC from where I live south of NYC to be closer to in-laws and it seems prices have at least stabilized and homes are staying on the market longer.

 

Home Ownership being the path to the American Dream is a propaganda probably started by the banks and likely a reason why Financial Literacy is not taught in schools. The decision to buy/rent is a math problem. Right now the math strongly favors renting. Nobody really owns their home. The Bank does and even after you pay it off the govt owns a portion of your home. If a house paid off home owner does not pay property taxes the homeowner will quickly be relieved of their ownership. So it's just a simple math problem to figure out if renting vs home ownership costs. Another issue is hardly anyone, especially young people, factor in the costs of maintaining a home extends far beyond mortgage payments. Water heater failure, furnace goes out, roof needs replacing, Renovations, Lawn care etc etc. Homeownership can eat up valuable time and money

Right now with insane home prices for first time homebuyers the math says take the tens of thousands they need for a down payment and put it in a brokerage account invested in a diversified class of ETFs across multiple assets classes and rent. Ramit Sethi has great write-ups about this topic

 

You kinda lost me. Do the costs associated with home ownership(taxes, maintenance, roof, lawn care, water heater) just magically disappear by renting? Does the landlord just eat those costs or does he pass them on to the rentor plus the management fee?

 

It’s not propaganda. Most Americans’ primary investment is their home.

not saying that renting is never the answer, but in most normal circumstances, home ownership is the much better long-term play. Unlike rent, At least some of your mortgage payment comes back to you in equity.