Looking for starter plane

"Ben Hallert" wrote in message
ups.com...
Great thread, I'm in the same mode right now and I'd like to run
another option past y'all.

I've been training in a PA-28-161 and I'm taking my checkride next
week. At the same time, I'm moving to a town that has no Pipers for
rent (Cessna only). I like the low wing planes, and I really want to
buy my own for my upcoming IFR training.

I can scrounge together around $20-25K out of pocket and I hate to
finance things. Since I'm an extremely low-time pilot, I don't want to
go flying with my family until I've got more practice. I've put this
together, made some cost of ownership calculations, and here's what I'm
thinking of:

Piper Tomahawk w/ IFR stack. I've seen nice looking, low time aircraft
listed in places for the 20-25 range. Here's what I get:

1. Full ownership, no financing.
2. IFR capable in the indicated pricerange.
3. Enough usable space to carry me and an instructor (I'm 250, leaving
about 160 to for a fully fueled plane).
4. Low wing
5. Low cost of ownership.

I'd love to buy a Cherokee 140, but they seem to be consistently about
10K higher. If I save up until I can afford one flat out, then that's
a bunch of time where I'm not flying. It seems that it might be a
better bet for me to get something that'll fulfill all of my needs for
the next 100 or so hours (I can always rent a Cessna for the occasional
flight I need more seats if I really decide I want to) while I build
some time and become a better pilot/get instrument rated. Finally,
I've read up a lot about the spin troubles, so my eyes are open.

Does this sound like a well reasoned approach? Am I missing anything
big? I know some of you might suggest 'go ahead and finance the
difference', but that's something I REALLY don't want to do. I'm
confident that I could get my money back out of the PA-38 when I'm
ready to upgrade to a Cherokee, and this seems like the difference
between flying and dreaming.

I want to go into this with my eyes open. Comments?

Ben,

I am with you on the finance thing, but I got over it. Here's why.

Most things that people pay interest on, they shouldn't. That's because
they would often save money and make a wiser choice by buying cash. If you
can't afford the luxury of a new car, then buying a used one is likely a
better choice. They are pretty much disposable items in the end. As far as
furniture and other items go, you are likely upside down in them as soon as
you start making payments - and the rates are usually stupid.

Houses are different, the cost of buying and selling is just too much.
Buying a house with over 20% down that you can afford to pay for is usually
a wise decision so long as you buy right, and expect to live there for 5
plus years. Often, renting and saving will not get you there, and in the
meantime, the house you wanted has likely appreciated. I have made money on
every home I have owned. I don't mean I sold it for more than I paid, I mean
that the check at closing was more than my down payment and ALL my payments
combined (this is not usual, but we have had a good run).

Now, for airplanes. You can buy an older plane and usually get back most of
the money you spend to buy it. What you are out is anything you put into it
to to bring it up to standard, fuel, maintenance, engine time, insurance,
and INTEREST. Yes, you can avoid INTEREST. But, planes are like houses more
than like cars or other items.

Better to have INTEREST on a plane that is the right plane for you, than all
the other payments with a lesser plane.

If you do the math, you will see that your costs look more like UPGRADES,
MAINTENANCE, FUEL, PRINCIPAL, and interest (note the small letters).

You need a cash reserve or risk grounding due to finance which means that
the bills get higher as the plane rots. Buying and selling low end planes
is fun for some people, but most would rather buy more plane now, and avoid
the transaction risks, costs and hassles.

Bottom line, unless you can find a plane thats just like you want it and pay
cash (and still have a few thousand in reserve), you are better off
borrowing money to finance it. It will give you a much better value in the
end.

"Dude" wrote in message
...

Most things that people pay interest on, they shouldn't. That's because they
would often save money and make a wiser choice by buying cash. If you can't
afford the luxury of a new car, then buying a used one is likely a better
choice.

I did that most of my life, and that is why I can now afford the luxury of
a new one every now and then. l compromize by using a healthy down payment and
maximum 36-month financing.

They are pretty much disposable items in the end. As far as furniture and
other items go, you are likely upside down in them as soon as you start making
payments - and the rates are usually stupid.

I agree.

Houses are different, the cost of buying and selling is just too much. Buying
a house with over 20% down that you can afford to pay for is usually a wise
decision so long as you buy right, and expect to live there for 5 plus years.
Often, renting and saving will not get you there, and in the meantime, the
house you wanted has likely appreciated.

Bingo! In my county, the average home went up 36% last year. In that type
of market ther is no way to "save" yourself into a house. You just have to
somehow get up a down payment and then jump on that elevator.

Now, for airplanes. You can buy an older plane and usually get back most of
the money you spend to buy it. What you are out is anything you put into it
to to bring it up to standard, fuel, maintenance, engine time, insurance, and
INTEREST. Yes, you can avoid INTEREST. But, planes are like houses more than
like cars or other items.

Save money; rent.


Vaughn

Save money; rent.


Vaughn

Ya, I heard the old saw the other day:

If it flies, floats, or f(ornicates) its cheaper to rent.

Normally, I laugh and agree, but this time I couldn't think that there was
something wrong with that advice. Then it came to me. In all three cases,
what the guy who rented it last did to it may kill you!

Is it worth the savings?

"Dude" wrote in message
...

Save money; rent.


Vaughn

Ya, I heard the old saw the other day:

If it flies, floats, or f(ornicates) its cheaper to rent.

Normally, I laugh and agree, but this time I couldn't think that there was
something wrong with that advice. Then it came to me. In all three
cases, what the guy who rented it last did to it may kill you!

Is it worth the savings?


No that's the truth!!! Well stated!!!!

"Dude" wrote in message
...

Save money; rent.


Vaughn

Ya, I heard the old saw the other day:

If it flies, floats, or f(ornicates) its cheaper to rent.

Normally, I laugh and agree, but this time I couldn't think that there was
something wrong with that advice. Then it came to me. In all three cases,
what the guy who rented it last did to it may kill you!

Of course, that is also true (albeit to a lesser extent) when you buy any
used aircraft. Even a good prebuy can't catch everything that has been done to
the plane over the last several decades. Also, nasty things have been known to
happen to parked, unwatched, airplanes; though a good preflight will catch most
of them.


Is it worth the savings?

So far

Vaughn

Is it worth the savings?

So far

Vaughn



LOL! Enjoy it while it lasts

Thanks for the replies!

An update:

It turns out that I can actually scrounge up about 30-35K. Before this
conversation, I might have automatically upgraded my sights to a
Cherokee, but the decision bears some thought.

Having extra cash in hand to cover unanticipated costs in the
beginning/whenever sounds like a good idea.

I understand the financing logic, and I use the same advice on the
properties I own (if I saved up until I could buy them outright, I'd
never buy them, and it'd be a bad investment of capital that could be
doing other things, etc), but I still have a hard time applying the
same model to airplanes. Sure, I'd love to have a Piper Cherokee four
seater with an IFR stack, in panel GPS, seat warmers, etc.... but I
_really_ hate debt load for 'doodads' (I'm sure some people in the
group will pick up on where I'm coming from based on that).

I've spent the last few years getting rid of soft debt (credit cards,
car payments, etc) and replacing them with capital debt (like my house,
investment properties, etc) and the number of actual payments I make
per month is down to the basics. It's not just the interest that gets
me, it's also the safety factor. I've been folding everything around
the concept of being self-sustaining in case I lose my job/medical
problems/economic downturn etc. Right now, if I stopped working for
the company I work for, I could still cover my bills and downshift to
an economy mode using my passive income. It wouldn't be great, but I'd
survive. I don't necessarilly think that WILL happen, but I'm working
real hard to avoid having monthly expenses that would push me into the
red in that contingency, and the payments on a nice plane fall into
that category. If I can buy a plane outright, I don't leave my little
financial safety zone.

I know, it sounds crazy. In another time, I might be the guy who
builds a big bomb shelter in the back yard, but for now.... I wanna
fly without having a 'car payment'.

I'm going to go pick up a copy of 'Buying and owning your own airplane'
(http://www.amazon.com/exec/obidos/tg...books&n=507846)
and do some worksheets.

Sounds like you have it all well though out. Hope your deal works out
great, and you have a lot of safe flying fun!





"Ben Hallert" wrote in message
oups.com...
Thanks for the replies!

An update:

It turns out that I can actually scrounge up about 30-35K. Before this
conversation, I might have automatically upgraded my sights to a
Cherokee, but the decision bears some thought.

Having extra cash in hand to cover unanticipated costs in the
beginning/whenever sounds like a good idea.

I understand the financing logic, and I use the same advice on the
properties I own (if I saved up until I could buy them outright, I'd
never buy them, and it'd be a bad investment of capital that could be
doing other things, etc), but I still have a hard time applying the
same model to airplanes. Sure, I'd love to have a Piper Cherokee four
seater with an IFR stack, in panel GPS, seat warmers, etc.... but I
_really_ hate debt load for 'doodads' (I'm sure some people in the
group will pick up on where I'm coming from based on that).

I've spent the last few years getting rid of soft debt (credit cards,
car payments, etc) and replacing them with capital debt (like my house,
investment properties, etc) and the number of actual payments I make
per month is down to the basics. It's not just the interest that gets
me, it's also the safety factor. I've been folding everything around
the concept of being self-sustaining in case I lose my job/medical
problems/economic downturn etc. Right now, if I stopped working for
the company I work for, I could still cover my bills and downshift to
an economy mode using my passive income. It wouldn't be great, but I'd
survive. I don't necessarilly think that WILL happen, but I'm working
real hard to avoid having monthly expenses that would push me into the
red in that contingency, and the payments on a nice plane fall into
that category. If I can buy a plane outright, I don't leave my little
financial safety zone.

I know, it sounds crazy. In another time, I might be the guy who
builds a big bomb shelter in the back yard, but for now.... I wanna
fly without having a 'car payment'.

I'm going to go pick up a copy of 'Buying and owning your own airplane'
(http://www.amazon.com/exec/obidos/tg...books&n=507846)
and do some worksheets.