Just say NO to Aviation Degrees and Debt

[Colonel Sanders]

http://www.youtube.com/watch?v=k-YlE6xqWfk

[Beefitarian]

$200000. I guess that's why I never finished my CPL. I was probably only in for around 40. Probably should have got a loan back then though. Working for the money typically got in the way of studying or flying. The best way would have been to squirrel it away but I just could never get over a certain amount before something comes up. Usually it's five or less I think my record was around 15.

Debt sucks though and it's tough to get out of.

[moocow]

I wouldn't be surprise about the $200K figure. First, it's the States. Second, it's a "degree" program. Not going into debt for a pilot career is the same answer I gave Cathay Pacific when they ask what I'll do if I wasn't accepted into their Cadet program. Probably one of the reason why I didn't get in, but you know what, I been to business school and I know how much of a bastard businesses are (ie banks). Even people working at government student loan program tried to talk my friend into paying interest only which extends the period of the loan and in turn more profit of interest. Unless there are more Cadet programs or in-line progression from school to an airline program, I don't think aviation is worth digging a huge financial hole.

[ahramin]

[single_swine_herder]

Colonel ..... wonderful to see you posting David Ramsey stuff ..... I have been a strong proponent of his way of doing business for about 10 years ....... and listen to his podcasts every day.

"Youngsters" in this business could learn a great deal by jumping on his material with both feet.

[costermonger]

The part about racking up all the debt, working for a few years and then leaving the industry is something I know happens all the time, but I just don't understand the math. I know a lot of people who've left to do other things; some had real degrees and went to work in that field, some went to work in a field that didn't require any further education, but a lot of them end up either going back to school in their mid-late 20s for something else.. If you used student lending to pay for flight training, how the hell do you come up with the money for that after making <40k for a few years and servicing a gigantic student loan?

[Shiny Side Up]

I was with him up until he suggested a degree in English would be worthwhile, and that if you were in debt from your education it might curtail your ability to go serve the lord when he calls...

Like many, when giving advice he totally fails to mention learning a trade, Which in my opinion is part of the problem we have today.

[Colonel Sanders]

I wouldn't throw the baby out with the bathwater.

His core message - don't go into debt for an education
that won't pay for itself - is a good one.

he totally fails to mention learning a trade

He would probably agree with you, because learning
a trade which is in demand makes financial sense.

There is this wild disconnect between our educational
institutions, and the real marketplace. The self-satisfied
educational institutions are happy to give students very
expensive (and useless) educations (which the students
go into debt for) and when their education is complete,
the students go off a cliff like Wile E Coyote as they
attempt to utilize their often useless educations in the
private sector.

They end up unemployed (or severely underemployed)
with a mountain of student debt, and the self-satisfied
educational institutions laugh all the way to the bank,
as they harvest $$$ off the next wave of hapless students.

These smug educational institutions share an awful lot
in common with "payday loan" operators. Predatory
sharks, preying on the weak and the ignorant, to enrichen
themselves.

Pretty nauseating.

I am reminded of my high school guidance counsellor,
whom I told, "If you knew what you were doing, you
wouldn't be here"

[costermonger]

Student lending practices & regulations in the US make payday loan companies look like not-for-profit philanthropists.

Kid going off to school for a degree gets a federally backed loan from Sallie Mae, pays interest all throughout their education, gets a crappy job upon graduation and defaults on the loan a few years later. Since the loan is federally backed, the gov't pays Sallie Mae for the outstanding principal, and then sends it to a collections agency like General Revenue Corporation, which is a wholly-owned subsidiary of Sallie Mae that exists specifically to collect on defaulted education loans. And they will get their money, because unlike pretty much any other debt a regular person might incur, education loans cannot be discharged.

So the bank takes no risk and profits twice off the same student. There's absolutely no incentive in the system to limit the amount of money loaned to obtain a degree with no earning potential.

[Shiny Side Up]

I wouldn't throw the baby out with the bathwater.

His core message - don't go into debt for an education
that won't pay for itself - is a good one.

Oh indeed, my point was that he sort of dilutes his credibility a lot. I guess I didn't think his presentation was all that good. He puts a lot of emphasis on trusting Mom and Dad, when I hate to say it, but in the case of the pilot girl, it really doesn't sound like they're any wiser. The ultimate problem when it comes to education - whether we like it or not - seems to be parenting. Everyone thinks their kid is special, going to be the next phenom, hence why people spend money on such things. Paying off a student loan is for most people going to be the first of a long line of ugly grown up realities they're going to have to face. Unless you're blessed by being born into wealth, I also don't think that its possible to get ahead without taking on some debt in this world, but it has to be carefully considered.

[Big Pistons Forever]

I did all my flying training and build up time on a pay as you go basis. When I started my first job as an instructor I wasn't making a lot of money but I also had no debt and money in the bank. This IMO is the only sane way to do flight training.

My 02 cents

If you are a young person just itching to be a pilot, Go to Well Beyond ButtFuck AB and work in the nastiest worse place in the oil patch. The place where nobody wants to go and which therefore pays you stupid money for a strong back. Work every extra shift and save every cent. Do it right and you could save enough to pay for PPL to CPL in one year. When you have enough money get a ramp/dispatch job to get your foot into the industry and earn some KD money while you do your flight training.

At the end of the 2 years of working your ass off and having absolutely no life you will have

1) A CPL

2) A resume with work experience both in and out of aviation

3) Industry contacts as a result of of your ramp/dispatch job

4) No debt.

You are now further ahead than 80 % of your competition.

[iflyforpie]

I never went into flying without a backup or a means to pay for it, and my kids definitely won't be doing it either... or any liberal arts degree or anything that requires a great deal of specialization, lots of tuition, and has poor job prospects.

Heck, specialist doctors can't find work in this country.... although that it most likely because they don't want to be a GP in some small northern town, not because there are no options for them. The large number of unpaid interns in business, law, and even engineering is also sobering.... all going after that elusive carrot just as a CPL with four bars does on the ramp.

Canada is becoming too top-heavy with professionals, which is what makes trades much more attractive. Trades cannot be outsourced easily, and even migrant workers are only brought in because of the lack of skilled workers in the country. Get a trade after a two or even one year course or even OJT if you are the right individual... no debt, good money, lots of jobs... then think about flying.

If flying works out for you, great. If not or if it is seasonal or doesn't pay enough, you've got a job waiting for you at the end of it.

[dogger7]

I never went into flying without a backup or a means to pay for it, and my kids definitely won't be doing it either... or any liberal arts degree or anything that requires a great deal of specialization, lots of tuition, and has poor job prospects.

Heck, specialist doctors can't find work in this country.... although that it most likely because they don't want to be a GP in some small northern town, not because there are no options for them. The large number of unpaid interns in business, law, and even engineering is also sobering.... all going after that elusive carrot just as a CPL with four bars does on the ramp.

Canada is becoming too top-heavy with professionals, which is what makes trades much more attractive. Trades cannot be outsourced easily, and even migrant workers are only brought in because of the lack of skilled workers in the country. Get a trade after a two or even one year course or even OJT if you are the right individual... no debt, good money, lots of jobs... then think about flying.

If flying works out for you, great. If not or if it is seasonal or doesn't pay enough, you've got a job waiting for you at the end of it.

I agree with much of your statement. I do, as a red seal carpenter as my "backup gig," take some issue with the thought that many trades are easy enough and well paying enough to have in your back pocket after a 1 or 2 year course. The talent level of the individuals being pumped through provincial trade and apprenticeship programs (often 3-4 years) is severely low for the most part. Companies are being rewarded with tax benefits to carry apprentices officially, when in fact for the most part they're just employing glorified labourers.

Having a trade on paper does not guarantee someone anything. Much like flying, if you do not possess the skills, you ain't gonna work.

Just my observations.

[iflyforpie]

But people will still get hired because there is a shortage, no? And they still will receive more money than if they didn't have the training.

I wasn't talking about quality... which is absolutely abysmal in most modern construction. My kids can eyeball things that aren't square or level in lots of the new houses in my area, and I know of a guy who has made himself a business just re-rocking buildings in our small town because of settling or poor installation.

But yes, it is up to the individual whether they are going to succeed, but that is for anything in life.

[dogger7]

Perhaps.

In BC, the shortage of actual Skilled Workers, not certified Skilled Workers, has prompted the BC contruction assoc. to fast track import 600 carpenters from Ireland. The union is pissed. Nothing to say this won't continue. Nobody's going to hire someone who can't actually do the job. It's not government

http://news.nationalpost.com/2013/10/15 ... ying-foul/

[iflyforpie]

Nobody's going to hire someone who can't actually do the job. It's not government

And there is now coffee all over my keyboard!

[Shiny Side Up]

I'm of several minds about this issue. Going about stuff debt free sounds all fine and dandy, but one must keep in mind you're also spending your most valuable commodity you have in this life and that's your time. Anyone who says you should never take on any debt to get ahead, just isn't aware of the realities of life. I've been able to take on debt occasionally when I felt it has been necessary and like all things its a calculated risk. For me its paid off. I'm way farther ahead in this world now than I would be if I just worked and saved. Hell, I'd probably be behind if I just stuck with that theory.

The point is a lot of people don't have the help, don't have the benefits that many of us take for granted. For instance, the ability to live at lower cost (or if they love you or tolerate you a lot, for free) with Mom and Dad to get on your feet is a tremendous advantage. Anything they can prepare you with for life is going to put you far and away than many people get. If one start out in the working world with "zero skill" you've got a long way to go. You won't get ahead, and you won't save enough to get ahead. You can think that you can plan enough, but shit happens. Been there, done that. For me I know I can always find a way to work for a living doing a wide range of things, and my main advantage is being blessed with a wide skill set. This makes a lot of difference if I need to do some work to earn money, to the tune of increasing my initial rate of pay from the start and enabling me to keep that rate of pay increased and demand better work.

Now that said, its usually a very bad idea to take on a lot of debt to do flight training, but in some circumstances I would advise it. Never to the tune of $200,000 mind you, why people persist on doing flight training the expensive way is beyond me.

Something to think about: Flight training is only going to get more expensive the longer you put it off, so if you are really hell bent on it, get it done. Be smart about it though. Paying as you go is great if that's not going to prolong things unnecessarily so - then in the long run you're going to spend more money. For me I know that even though I had to work off some debt, the flying world is changing rapidly so a lot of opportunities are changing and there's something to be said for taking advantage of those opportunities sooner rather than later. You'll kick yourself forever if you were at that point in time and you had to say, "I'm saving to get my license right now" rather than "hell yes I can fly that."

In short:
1) Don't be afraid of debt, but...
2) Never take on debt unless you're certain you can work it off, and
3) Never count on the thing you're taking on debt for to help you pay down your debt, lastly
4) Never gamble with debt.

[kamikaze]

"There is this wild disconnect between our educational
institutions, and the real marketplace. The self-satisfied
educational institutions are happy to give students very
expensive (and useless) educations (which the students
go into debt for) and when their education is complete,
the students go off a cliff like Wile E Coyote as they
attempt to utilize their often useless educations in the
private sector. "

It's easy to blame the institutions ... but don't forget they themselves are responding to demand. A given program that you may consider useless exists in part because people are asking for it and attending it. You can just as easily blame the students for creating the demand. Especially if the education institutions are private.

Also, there's an important sector of the population that thinks of education in purely academic terms, as an intellectual pursuit if you will, that isn't necessarily related to employment. It's easy to forget universities actually started that way ... as a place of higher learning in general, not just a place to learn a skill for a job.

[Colonel Sanders]

people are asking for it and attending it

because they are young and dumb and don't know any better.

You can make the same argument for payday loan
companies, but I don't like them very much either.

Don't be afraid of debt

Debt scares the sh1t out of me. It scares me a
lot more than surface aerobatics. Like heroin,
debt may feel good at first, but it will take a terrible
toll on your life.

[FL-510]

Where do these people get their numbers?!?

In canada, 200k in debt for flight school? Ahmmm, how could one possibly get to this number.
The total training cost is roughly 60k with an instructor rating these days.

And 25 k a year, maybe in the states. But up here, a guy working on the right seat on a king air 100 will make 30k...

This guy must be talking about the states.....

[Shiny Side Up]

Being a responsible debter is a lot like being a responsible car owner. Its unfortunate that our world doesn't teach people either very well. I personally don't think the advice "never go into debt" is viable, or at least is easy for the fortunate to say. For example, having a credit card is a form of taking on debt, but learning to do it responsibly is a critical thing that everyone should know. As a pilot especially - after all, you'd have a hard time getting across the country if you had to pay for gas only wherever you can make a cash in hand transaction, and it certainly will be a substantial inconvinience that will cost you more in the long run. I hate to say it but if you can't take on such a debt responsibly, then I wouldn't ever advise owning an airplane - unless you found it convinient to travel the country with a suitcase full of cash, or never leave your home base.

Now like a car, one might say "hey, I'm never going to take on that responsibility so it will never get me into trouble" but again even if you become a bicycle maniac and plan your life around walking to work, you'll rapidly find (especially in Canada) you become severely limited if you don't consider the option. Even if you don't drive, not learning about how to do it and how cars work would be foolish in this day and age. Debt is a tool and an option, but like a car, it carries responsibility.

Its easy to forget that many of us here are fortunate enough to have a head start in this world, but we'd be exceptions rather than the rule. I constantly see kids these days who are about to get out of school and have no marketable skills. Shit, I know kids who don't know how to use basic tools (think how many people you encounter know the difference between a phillips and a robertson and know what I'm referring to), tie a tie, do their own laundry or cook a meal. This is unfortunate, but its hard to blame them. From that point its really tough to "just work hard and save some money". I would go as far as to say its impossible, if they don't have some sort of boost from their family. I grew up po' and I consider myself fortunate. The problem that they'll encounter is that their wages from that point won't increase as fast as the cost of living will, and shit happens that can really set you back when you're starting.

From an older person's perspective its easy to sit back and know everything you'd do differently and all the stuff you did that made you successful. I don't envy anyone who's new at the game of life and just comming out of the starter round.

[Shiny Side Up]

In canada, 200k in debt for flight school? Ahmmm, how could one possibly get to this number.

The total cost could easily sky rocket to this number when one factors into account living expenses and tuition fees and all the other bullshit some schools heap into the problem. 60K would only cover airplane rental and instructor time. Living expenses often aren't planned for, but since it seems like Toronto and Vancouver are popular places to learn how to fly, over an average two year program rent is going to probably run you into the $30,000 range and up. Then you also need to eat....

[JungianJugular]

If you need to work to pay for flight training, do it. Minimize that debt as much as you can. It may suck knowing that it'll take you longer, but man what a great feeling it is knowing you're not using the shit $$ you're going to earn entering this industry to pay a massive loan. Even if it takes you longer you spend what, an extra year or two saving/working/studying? No big deal when you're a young guy/gal. Nothing sucks more than a debt to pay off coupled with a low paying job. Payments, payments, payments. Trades is an excellent way to go. I wish I had picked it up when I was younger, carpentry, plumbing, whatever as security in case something happened.

And make a girl pay for her own meal on the first date. If you can make her pay for yours without the "I forgot my wallet at home" line, I'll buy you a beer.

[FL-510]

In canada, 200k in debt for flight school? Ahmmm, how could one possibly get to this number.

The total cost could easily sky rocket to this number when one factors into account living expenses and tuition fees and all the other bullshit some schools heap into the problem. 60K would only cover airplane rental and instructor time. Living expenses often aren't planned for, but since it seems like Toronto and Vancouver are popular places to learn how to fly, over an average two year program rent is going to probably run you into the $30,000 range and up. Then you also need to eat....

You must eat a shit load of food!!:P 110K of food for two years!
Anyways, just found 200k surprising and wanted to give my 2 cents on that one.

[ReturningPPL]

I can see how it might add up to $200,000 per year if you calculate it with something called "opportunity cost" which is the money you would have made if you had a job. In other words to goto school you have to forgo maybe a $50,000 per yer job and pay maybe $40,000 in living expenses then you can say it costed you $90,000 to goto school for that year.

Something else to note here is that being a pilot is one of those "cool" jobs that people like. Little kids do not grow up dreaming of being a welder or electrician. Everyone wants to be something like doctor, rockstar, athlete or pilot. Saying you are a pilot probably makes you more interesting than being the average office worker or labourer.

There's probably also a "perception" that pilots make tons of money...after all you have 30 people's lives relying on you, a million dollar airplane and a snappy looking uniform:)