JoeyMeatballs

I just saw on CNN that their are twice as many millionaires as their were a decade ago.................. what the hell types of jobs do these people have and to you major guys, I understand you have taken huge pay cuts, but are you guys the poorest on the neighborhood ( I understand this depends on where you live), or are you guys still looked upon as successfully people by your peers..?

hangaber

Misleading assumption by CNN that millionaire means rich. We all have to be more or less millionaires to retire. $1,000,000 times 5% interest is $50,000 per year to live on. Poverty level is $20,000 for a family of four. $25,000 in Alaska.
http://aspe.hhs.gov/poverty/07poverty.shtml
Throw in a child or two with college expenses. A divorce to pay for. Rising medical care or no medical care at age 60. And it isn't a rich-like lifestyle at all. You can get away with $500,000 and a military retirement. ($25,000 military pay per year amounts to another $500,000 at 5%, sort of). So again, we all must be millionaires more or less.

JoeyMeatballs

thats even more depressing news...................

Bucking Bar

I'm still a Regional Captain, but will have over a million in cash and liquid investments before age 47 despite the lousy regional pay and every dollar put in the bank has been earned one hour at a time. I think CNN's commentary is the direct result of inflation and our government's profligate spending. A million dollars is not what it used to be. Also, my wife and I contribute at least 10% and sometimes more to charitable projects both in the US and in the southern pacific islands. It is all about what you enjoy and the food, scuba diving, music and people on some of the remote islands we have gone to can't be beat (and it is "twenty five cent beer" sort of cheap in that part of the World)

There is an old book called the "Millionaire Next Door" that I suggest you pick up, if interested. The millionaires in our society are usually NOT the guys int eh $500,000+ homes driving $60,000 SUV's. The most popular vehicle amongst persons with over a million in net worth is a well used Ford F150 pickup truck. The secret to becoming a millionaire is to avoid debt and stick to a savings program. It is not rediculously hard to do.

Major airline pay is sure not what it used to be. Corrected for today's inflation airline Captains at major carriers like Pan Am were making as much as a half million, sometime much more, a year. My Father's Flight Engineer pay was almost $200,000 a year in today's money. Fed Ex's profession leading pay has actually not kept pace with inflation from where Flying Tigers was in their day.

At a major it will take me four to five years to break even and a Captain upgrade will be required to really go off to the races financially.

hangaber

In the best selling book, "Rich Dad, Poor Dad", the author's main theme is that rich people collect assets, poor people collect liabilities. And the definition of asset is something that pays you money. Liabilities are things that you pay them money. Simple.

JoeyMeatballs

I have the book, never read it.............go figure, I have to start making some changes, problem is between credit cards, school loan, and 1st yr regional pay, you just cant draw blood from a rock..............im P*** broke

Deez340

100% correct! also try Total Money Makeover by Dave Ramsey. if you pile away money (not debt) early in life by your mid to late forties your money can be making much more money than you do. although it would be a lot easier to do at half a mil a year.

SharkyBN584

SAAB - best thing you can do in your first year is:

1. Take 10% and stick it in your 401k.

2. Take an additional 10-20% off your net and shove that in a savings account.

3. Get used to living on the rest.

4. Pile up some savings, then start tossing that into investments (mutual funds, index funds, real estate, etc) once you have 3-6 months worth of salary in cold, hard cash (cuz nothing bad ever happens in this industry...ever).

5. Adjust accordingly with increases in pay.

It'll take a couple years to get really financially solvent enough to let your money make something for you, but you'd be amazed how much you build up just doing items 1 and 2 (even on 1st year regional FO pay).

FlyerJosh

The biggest tip I can offer to new hires/younger folk is participate in your 401K from the earliest moment possible. At the very least put in 5%. If your company doesn't have 401K, find a good Roth IRA and set up a retirement account.

The compounds over time are incredible and missing out on the first 5-10 years can really impact you in the end. Looking at my own investments and doing some simple calculations (using guesstimates on variables) I figure that over the last 5 years of my career (age 60-65) my 401K will go from being worth about 2.3 million to over 3.6 million. That's a lot of growth in only 5 years. If I had started 5 years earlier (when I first got an airline job), my 401K would have been worth over 5 million at age 65.

Start early and you have the potential for huge returns in the end.

rickair7777

YES. Maybe wait for second year, but start paying yourself before you pay your debts. Max out the 401k, and other retirement options and try to keep tabs on the hot economic commodity of the month...that may afford you an opportunity for a large capital gain at some point. It's pretty easy if you start young.

Real estate was the hot ticket a few years ago...what's going to be next? If you can invest in reasonably secure opportunities which have fast growth potential, eventually you stand a decent chance of hitting big. I average about 2-3 losing propositions for every winner, but the winners tend to make up for the losers by a very large margin. Obviously you should keep a significant part of your assets out of speculation, just in case.