jonnyjetprop

Found this on the cargo forum. Applies to all pilots. Too good not to post here:


I'm no financial genius, but I work with a few.

I wouldn't wait for anyone else to make you rich...FedEx, the USAF, your bank or DOD contractor job. Even a good job falls short in times of rising inflation, and there are a lot of challenges in our industry. Add my pet peeve--taxes--and you'll see the more you make the more someone has decided you need to share with all those nice folks who have kids out of wedlock and don't need to work. Yeah...our money pays for hellfire missiles for predators and jet gas for fighters, and gate guards at the National Parks, so it ain't all wasted.. But it does stink watching so much get cut out... Taxes are built to be taken from workers.


Simple keys (and I don't always follow them)...avoid stupid debt. Pay off all credit cards. We spend thousands every year, but we pay them off every month. Controlling costs is a start. Buy two new tires instead of 4. Eat in a bit more. Pass up the new set of duds once in a while. Thrifty gets easier with practice. Some of our captains have morphed it into an art form.

Next--max out the 401k. It forces you to save, and gives you a tax reward for doing so. Between your B plan and 401k you can put 25-30k a year in your retirement. Do that for the next 20 years and you'll see the rewards. I'm not a stock picker....2001 crushed me so I've done mostly bonds and money markets with 35%-40% in stock....which is backwards from what the experts say is right for a 43 year old. But I've slept well the last two months knowing I wasn't getting completely wiped out like I did back in 01.

If we continue to have min BLG lines, you might consider a side job. Its hard to find anything that will pay you what a day's work at the MD11 helm will pay, but that's not why you do it. You do it to diversify your skill set. Real estate agent and mortgage broker jobs were popular in the real estate rush, but both are probably pretty tough now. One good friend builds log houses, another F-15 bubba runs a car lot and a auto garage. Both are doing well even in this slowing economy. If I had a silver bullet of a job, I'd share it, but I don't...except....for DOD guys there are lots of jobs now in UAVs and special ops....both as reservists and contractors doing support jobs. A part time job doing either of those gigs is good job security. A key to success IMHO is use YOUR contacts and someone else's labor, and then manage aggressively. I do this with a stable, but some other (much!) higher margin businesses would be lawn services, aircraft or car dealer services, or (eww) septic services.

This to me is the key...because when you own a business the tax code is built around you. Many of your expenses become legitimate tax deductions. You also get a certain pride in ownership and security in working for yourself that you just cannot get anywhere else. You also learn what an economic cycle is...and sometimes that stinks. That's why keeping a solid airline job with benefits is such a nice compliment to your own business...you get the best of both worlds. Look around FedEx....I've met contractors, barber shop owners, and host of other busienssmen.

Another point is the spouse. No secret that age 65 changes and a softening economy CRUSHED the airline hiring, and thus my interview coaching business in the process. However, the wife put on the superwoman cape and has gone into some business development providing training to local businesses and also overseeing a government grant bring some technical training into local rural schools. The combination of those might not match the drop in our business dollar for dollar, but they came close. Just like in so many other times in my life, I have come to appeciate the value of a solid and loyal (and extremely capable) wingman. Any crisis or financial problem you face is a family problem, and therefore probably requires a family solution. If your spouse wants to stay home--super--but everyone needs to be realistic about the opportunity costs. By the same token, if you have a working spouse your image of 3 squares on the table every day and having a sex kitten lounging around the house while you sleep in on B reserve need to be modified as well. Everything has a price--but the solution will be a joint effort.

Set realistic goals. You've been a WB FO for a year. You don't get rich quick in almost anything.

Finally--don't chase the noise. Don't just chase what you read in Money, saw on CBNC, or heard about in the AOC. I've seen guys move 200k into a position in a stock and make 40-50k in a week. What that person WON'T share is they also lost that much 2 or 3 times recently, too. Look at the big picture when you invest. When we were kids there were 240 million Americans. Today there are well above 300. Our kids will live in a 400 million population. They have to live somewhere, and they'll need food, clothes, and utilities. A fifty acre farm might not "flip" like a Mud Island, Destin, or San Diego condo, but you can grow corn and cattle on it, hunt on the weekends, and cut firewood if you need it. Stocks that pay solid dividends may not make you rich overnight, but if they pay 4-8% a year (or more like some are now) you'll be doing better than if you invested in a CD.

And...no kidding...support your profession. I'd probably work 2 jobs if I got paid a million bucks to only work Tuesdays, but I thrive on challenges. The irony that so many airline pilots NEED a second job, especially at the regional level, is certainly not lost on many of us.

Good luck. Warning: I don't always follow my own advice on spending or investing. I'll be having this talk with myself quite a bit too...
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Thanks. I'm trying!

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Last edited by Albief15 : 10-13-2008 at 10:48 PM.