Living Below your Means vs Living in Base
 

My wife and I have been wrestling with this question for a bit. Bought a house before getting hired at a legacy, locked in our mortgage at a cheap 30 year fixed rate and now I commute for Delta. The common conventional wisdom is to live below your means so a pay cut would not be some devastating event should an economic down turn occur, but if there ever was a reason to subject our family to such risk it might be living to base.

We are restricted to where we can buy. We live in a nice area with good schools for our kids and frankly don't want to give that up. Looking at comparable living situations, we'd be almost tripling our monthly mortgage expenses, likely forcing me to upgrade or work the system more than I am currently as a fairly senior FO.

I don't mind the commute so much, but obviously not having to commute anymore would open up a ton more possibilities in this line of work.

Financially it's really easy to calculate. I am not at Delta, so I'm not privy to your work rules.

Living in base generally for me, over a career, corelated with about a 15% increase in credit per month. Do the math on what you're missing out on with commuting schedule vs a modest schedule of picking up premium/open time trips that you otherwise wouldn't in base.

QOL is pretty self explanatory, sounds like you have kids, and driving to/from work and being able to change your trip mix could produce pretty tangeable results in being able to spend more time with family. This in addition to not having to commute.

Triple the mortgage is a tough pill the swallow. As a counter point, perhaps renting in the interim could be an option (and invest your equity from your house, so you're not losing out). As you get more comfortable with the location maybe you can find an area that is lower COL but still provides you what you need. Someone on here will say "Mortgage rates will drop!", which is probably true, the question is how much and for what reason. That being said, if that decrease in Mortgage rate coincides with an economic downturn (likely) then you're really not much better off unless your seniority insulates you properly.

As a "Senior FO" the tradeoff of living in base versus upgrading might be a little more digestable vs commuting to reserve as a captain.

Always, always, always do what’s best for your family, not yourself. It’s part of being a husband and a father. If that means commuting for the remainder of your career, then that’s the way the cookie crumbles.

If you can make both goals (best for your family AND live in base) align, then you've won the lottery!

Also, remember that living in base as a new hire FO may not mean living in base later in your career depending on your other goals (upgrade, widebody, etc.).

Where do you have the most family and family support around? Where are your friends? Where are your kids’ friends? How are the schools? Would moving to live in base mean your entire family starting their lives over? All questions to ask.

A totally individual decision, based on a lot of things unknowable from the limited information given.

Some commutes are easy - depending on base of assignment and frequency of flights. Especially with the seniority that allows you to get commutable lines. Living in Boise and commuting to DET or NYC - not so much.

Keeping your current house as a rental is likely a good long term investment in some places to take advantage of that cheap interest rate. And being a junior CA living in base might not be all that bad. Severing local relationships can be traumatic - but for military families it's a way of life and most survive it pretty well.

Just make sure you have spousal buy-in, whatever your decision. Divorces are expensive too.

It wouldn't even be a question if my wife wasn't open to it or it meant a worse QOL for my family. For the sake of framing this question, let's just say the last paragraph is not a factor whether we stay or move.

Under normal times, I wouldn't have had a meteoric rise in seniority the first 2 years at a legacy and the median price and interest rate of a home wouldn't have doubled, but here we are!

The QWL comparison is somewhat tricky to balance, seeing as how I'd have to credit more to be financially comfortable but I'd also have more schedule flexibility. Right now I'm a min credit kinda guy spending more time at home commuting than I ever did living in base for my previous carrier.

As you know there are a lot of moving parts to this decision. Will this remain your preferred domicile until the kids are out of the house? Could you rent your current house for a significant premium over your mortgage/property taxes/insurance? Could you sell your current house for a significant windfall without generating a tax liability? How does your spouse feel about living near your domicile? Etc.

Living in domicile is amazing for your QOL and ability to be there more for your family. However, the housing market and overall economy is in a weird spot that may make it worth deferring a decision for a couple years. Finally, consider whether you prefer the advantages of in state tuition in your current state vs the prospective one. At the end of the day it’s a judgement call

Dont let the golden handcuffs of a cheap rate control the decision. If housing prices have doubled then use that newfound equity to begin living where it makes sense long term. With kids though once they get to HS age it gets a lot harder to change locations. Lastly like an infamous podcaster says "marry the house but date the rate" meaning you can always refinance but generally prices seem to go sideways or up over time.

I hear what you're saying. It's the rate in combination with the increased price of housing. Renting out my current house from another state just sounds like a giant PITA I would rather live without, not to mention my portfolio would be almost entirely real estate between two houses once we finally buy wherever we decide to live.

A 6% interest rate is high compared to what we locked into, but it's not that high from a broader historical perspective. What's tough is 6% on more than double the house.

Totally understand, think I was misunderstood, in fact I was stating is sell current house, use all the equity to mitigate new loan to value as much as possible on new home and have built in equity on new house from day one. Then take best rate you can get and IF rates fall in the future, refinance.
Long distance landlord can be a PITA and generally the juice is not worth the squeeze especially if you have high income as tax law prevents taking losses on current taxes.

How old are the kids? If they're in their teens, I say stick it out until they're gone and then decide. If they're younger, it's a tougher decision. Tripling your mortgage might sound bad at face value, but if you are still comfortable and can still afford it if you go out on LTD, then it isn't that bad, especially if your quality of life goes up.

Hore a property manager, it's less of a PITA. I have 3 houses as rentals (collected due to job changes). Thanks to low interest rates, they all turn a fair profit. I really wouldn't worry about your portfolio being heavy realestate since you're new at your major your 401k balance will increase rapidly when you're dumping close to the overall max into it between you and your company contributions. You can always throw money from your monthly cash flow and your profit sharing checks towards the new house to pay it off early also.

Even the easiest commute is still a commute and commuting takes every job down a peg. A great job is a good job, a good job is now a moderately crappy job, etc. With that said there are always going to be reasons to suck up the commute. Something to think about though is while you are wise to consider being able to still afford where you live in a downturn, would you still be a senior FO in that case and able to make the commute tolerable (eg being able to bid commutable trips, or have enough days off between blocks of work, being able to hold lower line values, etc). The first day I didn't commute to this job is the day I told my wife that going forward if we were to ever move, pick a domicile city and we will live within a 2 hour drive of it. Even when junior I can get a pretty good schedule be being able to "bid weird". Since I don't need to worry about commutability or minimizing out of pocket hotel rooms I have a lot more leeway in how I "restrict" my schedule. I'd look at a few things like how much premium do you miss out on not living in base and would that make a difference at your current seat/rate? What are the schedules of those at your seniority who have upgraded look like? Would those be tenable for you living in base? What is the likelihood of your commute getting harder? Do you have a current drive option? Is there an option close to the domicile but maybe a 2-3 hour drive that you'd consider? I will say, nothing beats driving to this job. My car is never weight restricted, oversold, or has a senior/first in line for the jumpseat. Even when I end up flying some of the crappier/less desirable trips it just means I got a block of days off I wanted and nothing better came along to trade. I took some trash to get some treasure if you will.

Driving to work is convenient and is a game changer as far as the job goes. The biggest factor is where your family really wants to live, and where you want to be on your days off. I have to allow 7.5 hours for my commute between leaving the house and show time, but it's worth the ability to live exactly where we want to. Others are perfectly happy living close to airline hubs and enjoy a great life as well. The bottom line is that your life is at home, and this is just a job.

My kids are grown, it is cheaper to live in base and I still commute. This job lets you have tons of flexibility, let your life be the driver. You can make the money work either way—only you can decide what is best for your family.

The reason to not commute is that it frequently makes people miserable.

You do not sound miserable.

It is unclear to me what problem would be fixed by you moving.

Also “mortgage tripling” can mean a lot in relation to senior FO pay. Is it going to go from 1500 to 4500 or 3000 to 9000?

~2k to ~6k. Rough numbers.

tough call. I’m locked into a good rate as well. don’t commute but was toying with the idea of moving closer to the wife’s family on the opposite side of a 1:30 drive to NYC. Would go from 3 to 8 for the kind of house I would want. Could make it work as ER A but never in my life did I ever think I’d be contemplating an 8k mortgage payment.

How old are the kids?

That's the nicest thing anyone has ever said to me on this site.

Young, just starting school.

I had a $2500 mtg and $1100 a month in personal property tax in VA. On a 1450 sqft 3/2 on .25 acres in VA Beach.

Upgraded to 7ER Captain from 320 Captain

Bought a 6000sqft 5/5 on 3 acres (really 9, but 6 is wetlands and conservation land I can't do squat with)

$7400 MTG and $0 in personal prop tax.
so I went a little more than double.

I can sit short call in bed. 35 miles to EWR, 45 LGA, 55 JFK.

Especially now with the commuter unfriendlyness with the RJ frequency reduction it's nice.

Honestly in that case this is the time. It will only get harder/impossible as the kids get older. It's a different job when you can drive to work (more importantly when you can drive home from work.

Always drive to work. Your family will thank you for it. I commuted for 3 months and couldn’t even fathom doing it anymore than that.

While the kids are young is the best time. I moved because of my dad's job in elementary school, and twice in high school and the last 2 sucked. I'm based in Chicago but live in Indiana. I have at least 6 options a day if it's commutable on both ends, and a 3 hour drive if I choose that. I mostly drive since there's no weight restrictions or full flights to worry about. If it's a major hub and you don't want the expense of living in a big city, the drive from another state might be worth it. My state income taxes and property taxes are much lower compared to Illinois

Sure, the concern is not the kids so much as weighing the risk/reward of going from a good setup to a great setup at higher cost, given the real estate market.

If it’s only money, for a senior FO, a 4K per month difference isn’t anything earth-shattering. If you’re on a domestic fleet, that’s like picking up an extra day of premium per month.

I have commuted to every airline job I’ve had (20+ years). I do a long drive AND a flight. I’m totally over it. It’s a complete waste of time and tough on the body.

That said: I’m not moving to a base either. Some reasoning: We aren’t city people. We like rural areas and our friend/family network where we are. We live well below our “possible” means. This allows me to work less and have more time off to keep the sanity vs. continually commuting. I’ve found flying less at a higher rate (CA) is preferable to “working the system” as a senior FO. Fly a few trips a month and chill. We’ve got quite a bit of acreage and built the “captain’s house” in the country. If we sold it all, we might get a 3 bed/2 bath on a 1/4 acre built in the 80’s at most of our bases. Just can’t justify that.

Commuting sacrifices lots of career opportunities if you hope to keep your family and sanity, but I think it can be worth it if you don’t have the mentality that you need 100 hours every month until age 65 to make you happy.

Good luck. Tough decisions.

Surprisingly (to me not from there) northern New Jersey I actually have a bigger house and more land than I did in Wyoming (granted I lived in city limits in Casper, WY)

I can only see the nearest neighbor if I look out two windows on that side of the house on the 2nd floor.

200 acre boy scout camp across the street and a couple thousand acres of state forest behind that. Running water/waterfall on the property. Backs up to a large pond, although the pond frontage is conservation land so no building a dock and walkway to the dock. But it cuts my property tax bill in half.

5 miles from downtown Denville which is basically Mayberry with better delis. 6 miles to the train station. 1 hour to NY Penn on the train but I normally drive vs NJ transit to Penn, LIRR to Jamaica and then Airtrain to JFK.

Another 10 minutes down the road to basically any shopping I need to do. That was a problem for my wife in some of the more rural places we lived when I was doing oilfield stuff. 90 minutes one way to the nearest Walmart/Target/non IGA grocery store gets old.

The only "wanted but didn't get" was room to build a motocross track on the property. Technically have the acreage but the terrain isn't conducive to mx. Hard Enduro or trials it's great for.

You're correct! It wouldn't be a problem as things stand right now. The thing is, I wouldn't want to be in a position to rely on premium or perhaps no longer being able to upgrade if things didn't work out. Maybe I'm too risk averse but when old timers told me the stories of FOs buying million dollar houses only to get furloughed a year later, that stuck with me.

Just go where you will be happy. If you are happy then you can deal with commutes, traffic, insane housing prices, taxes…there is poison everywhere, you get to pick yours.

That's why you roll your acquired equity into your new house, yes the overall bill will be larger, but if it is the place for you to grow your family, lay down roots. Time will pass and the mortgage will seem less and less and with some extra payments you may even retire it earlier than you planned.

If all heck breaks loose and you feel overhoused, you can dump the place with the equity you have already involved but chances are slim that will be the outcome unless you are being completely overleveraged.

It really comes down to where do you want to live?

I always enjoy your posts here, and it doesn't surprise me that you are posting here looking for a sounding board of sorts. Nothing wrong with that. As a long time person in this biz I'd say a couple of things. 1) Do whats best for your family first. 2) Your QOL. 3) Your earnings. I've been a commuter most of my time here save for a few years I lived in base (which Delta subsequently closed). That forced a move to where we are at now and we haven't looked back.

I hate commuting, not gonna lie. Hate it. With a passion. However, where we've been at we live in a great area, great schools (we put our kids thru private schools though, but still all said, the schools around us are very good), have great neighbors and a very good sense of community. My wife has made long term friends here. She's engaged locally with many of the local civic groups. We grew roots here as a family and I never thought once about uprooting that tree just to make my life easier. So I commute, and I hate it, but my family is happy (just me and wife now as the kids are all grown up and on their own).

Living below your means - yes. I've done this my entire career. It's not hard. No boats, no planes, we only own one house, and its paid for many many years ago. I do have hobbies, they are just not the expensive kind (guess Im lucky in that regard??). The best advice from me, as a long term player in this game - Live below your means, keep your family happy best you can and retire still married to your first wife.

Best of luck to with you and your families decision, and I mean that sincerely.

I was just using that as an example. Sounds like you need to make a spreadsheet of your expenses. An FO at the top of the pay scale making 250-300k/year can afford a 72k annual expense on housing, max the 415C limit, contribute to a back door roth for both you and your spouse, plus save for college and pay off some extra on the mortgage.


There is a lot of slack in there. If they are furloughing senior FOs, the black swan is so deep that you probably need to worry more about how much ammo you have.

That pushes strongly towards moving. Lot can change in 10-15 years and better to move while it's easy.

High housing costs are ... high. But some of it is forced savings - at the end of it you do have a much more valuable house for that increased payment. You may also see better appreciation.

Thoughts
1) Living in base gives a lot more options for dealing with financial surprises
2) Consider moving into a starter house that will be ok for 12-36 months. Rent it out after that and buy the big house.
3) As noted above, $6k/month for a house isn't cheap but I'd call it within your means. Pay down the prinicipal ASAP and you can reduce some of the interest expense.

I'm old enough that I saw 9/11, age 65, financial crisis, post recession oil boom, and covid. If there is anything history teaches us, it's that it will repeat itself.

My personal opinion is anything above $3k monthly PITI and >15 years is asinine. You're locking yourself into a careers worth of high payments. Note: this assumes you're the breadwinner, and your wife isn't an ER doc.

Just IMO but it's far better to life frugally in this career and, when the time comes, purchase what you want wish cash than it is to purchase on a monthly payment. That goes for anything - home, vacation condo, vehicles, boat, airplane, other toys, etc. Keep in mind, nicer things cost more to insure, maintain, and come with higher property taxes as well.

The happiest people I've known in this job owned everything they had outright without payment. I can promise you, your kids dgaf if you have a million dollar home in a wealthy zip code.

$3000 PITI will barely break 400k in most areas and that's with putting 20% down. That's at 1.5% property tax and 0.5% insurance. Florida/Flood zones? Even worse.

Granted I look at things through a Delta lens, but for us, you aren't getting squat in any of our pilot bases save Detroit for that. Crack house in the hood or a single wide on sone acreage maybe but a decent 3 bed 2 bath with non war zone schools?

Nope. Not gonna happen.

Not much to add other than we’re in the same boat as you and decided to make the move now. ~ 20% FO and our current mortgage is $1500/ mo. And we traded that for $4300/ mo. It was tough to stomach the idea of that, but we got a new build on some land an hour from work in a nice area. We had outgrown our old house and it was time for a move so we figured now was the time before our kids are school aged.

The prospect of 30+ years commuting isn’t a fun one and moving to base is only a 4.5 hour drive from our hometown. I suppose time will tell if we made the right call, but so far so good. Good luck.

You lump a home which is an appreciating asset into the same bucket as toys and depreciating assets. Thats a big mistake. Home ownership at the upper end of what I could afford is what set me up for a great retirement. Real Estate be it the house you live in or investment property should be a part of your long term financial strategy. A mortgage leverages a lot of potential profit before you even consider the fact you have to pay to live somewhere be it rent or a monthly payment. All in I have not paid a dime to live in great houses the last 30 years. Appreciation has exceeded my payments. It set me up in retirement to be free of all house payments and own a nice vacation home to go with my primary residence. Equity also aided getting my kids through college during the bankruptcy.
When you look at a monthly payment look at the difference between the payment and renting. Keep in mind most payments go down over time via refinancing while rent only goes up. Now add in potential equity growth. 4% is about the average over time. That 4% in a house compounds like a savings account. On a 1 million dollar home your getting 40,000 a year to start compounding to higher amounts over time. There is no need to live in a shack. Put your family in a descent home.

Yeah and add a 15 year rate onto that and you are definitely talking trailer category in most of the country.