Budgeting Tips for Pilots with a Variable Income
On this episode of A Wiser Retirement™, Casey Smith is joined by guests, Justin and Jennifer Place. Justin and Jennifer are both pilots at a major airline. They discuss what it was like starting at regional airlines and how to make it to the majors, different career paths for pilots, variable income budgeting tips, emergency funds, airline 401k plans, and planning for retirement.
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Summary
Starting Your Career in Aviation
There are different paths young people interested in aviation can take today. There are programs at the University of North Dakota, University of Florida, or Embry-Riddle Aeronautical University for those coming out of high school. It is important to choose a school that will set you up for success in you career as a pilot. You should also consider trying to get a job at an airline with strong financial stability, like Delta, and use regional carriers as a backup. The aviation industry has changed significantly over time, with pilots now basing their career choices on where they want to live rather than just which airline to work for.
Why Emergency Funds are Different for Pilots
Pilots emergency funds require more than the typical 3-6 months that most people set aside. Pilots should have around two years worth of living expenses in their emergency fund. It can be difficult as a pilot to find a new job if you loose your current one, so having an adequate emergency fund in place will help you be prepared.
7 Budgeting Tips if You Have a Variable Income
It can be tricky to budget when you have an unpredictable income as a pilot. It’s important to make sure you’re on the same page with your spouse regarding finances and that you set clear goals together. Quicken is a popular tool to manage and monitor expenses effectively. Here are 7 helpful tips for budgeting with a variable income:
- Cover your minimum monthly expenses first.
- Budget using your average monthly income.
- Budget using your lowest monthly income.
- Set up an account to pay yourself.
- Build your emergency fund.
- Plan ahead for peaks and valleys.
- Set priorities for your investments.
Links:
- Click here to download your airline’s 401k allocation for free.
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