How to allocate money for buying?

How to allocate 60k for buying a fast IFR platform?

  • Spend 60k, buy the plane outright. Take old IFR

    Votes: 2 28.6%

  • Buy good avionics, high time engine and plan to replace it within 200 hours.

    Votes: 2 28.6%

  • Finance part of the plane, buy a great VFR platform and install avionics

    Votes: 0 0.0%

  • Forget the engine fund, it's a waste

    Votes: 3 42.9%
  • Total voters
    7
bflynn

bflynn

Final Approach
Joined
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Messages
9,594
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Display Name
Display name:
Brian Flynn
Semi-hypothetical situation - I don't know that it's 50k yet.

$50k available to spend on an airplane. Mission is 1) fast travel meaning >=150kts, 2) IFR training, and 3) currency, say 10 hours a month of time. A loan is permissible, but looking to keep the monthly costs under $1200. High time engines are also permissible, but I intend to fully finance an engine fund out of the 50k at $11/hour. So, get a 1500 hour engine and you take $16,500 out for the engine fund.

An early model Mooney is desirable, something with manual gear. Maybe a Bo, but what's the maintenance cost?

Avionics target is GTN-650/750 + adsb transponder. A bluetooth connection for Foreflight would be really nice.

The combination of fast + avionics + low time engine seems to be tricky. I see 4 options, probably could come up with more.

1) Buy an engine with a low time engine straight out. Accept old IFR instruments.
2) Buy the avionics I want, plan to replace an engine within 500 hours
3) Finance the plane, get low time engine, install new avioncs
4) forget the engine fund, buy the best I can.

Your thoughts?
 
Step 1, find a partner, or even two, so you can afford a well equipped >150 kt plane. :oops:

Get your money/finances ready and then have some patience. If you wait you can find a good match, but be ready to pounce. Still need to do the validation and pre-purchase inspection (PPI), but be ready to move quickly as the better ones will go quicker. Finding one with more of the "stuff" you want is cheaper than upgrading it later. Plus you won't have the down time for it getting installed.

I don't know about NC, but there's sales/use tax on purchases for those of us in Georgia. Along with that plan for PPI costs, insurance, GPS database subscription, etc. That will be a few to several thousand beyond the purchase price.
 
Buy the plane that is equipped and outfitted as you already want, then replace engine if needed is my opinion. You will spend 50% more on avionics and upgrades vs buying it already done and you will only get half the value back in resale if you do the upgrades but an overhaul will see a much higher return on investment.

Too many people seem to be scared of engine overhauls, but that is where the deals are. I bought my 182 with and engine that was past TBO and got twice as nice avionics and cosmetics than I though I ever would...as long as you also factor in that eventual overhaul cost as well.

Purchase price plus overhaul and I still was not finding a plane as nicely equipped and have gotten several hundred hours outta it

In the $50k range you will be lucky to be 430/530 equipped with a Garmin 330 that you could easily upgrade to ADS-B.
 
bflynn said:
1) Buy an engine with a low time engine straight out. Accept old IFR instruments.
2) Buy the avionics I want, plan to replace an engine within 500 hours
3) Finance the plane, get low time engine, install new avioncs
4) forget the engine fund, buy the best I can.

Your thoughts?
Click to expand...

You’re asking what I would do in your shoes so here it is. You get to choose though, since you’re an adult. :)

1. Is a sure fire money burner. New avionics depreciate by half the moment they’re installed. Buy the aircraft with the panel you want. BUT... right now with only a couple of years to the mandate deadline aircraft that have those toys are owned, loved, and being flown. Aircraft that don’t have those toys, some owners are going to dump them before they have to sink $10,000+ into the panel. Shop around. Of course.

2. Avionics are unrelated to the engine. See below. Keep them separate in the analysis.

3. Never finance a depreciating asset if you can avoid it. Ever. That’s just multiplying pain and increasing total cost. If you do, always keep total value of all depreciating assets owned well below half of your household annual income. Depreciating assets are a sneaky way to take your money out back and light piles of cash on fire in the back yard. Car enthusiasts do this and become “car poor” by buying things they can’t sell next year for what they paid for them. Machines generally go down in value. Airplanes go down in value in stages as the engine time is run off and pop back up with new engines.

*** The thing about financing is it adds risk. Adding risk to life for a toy can make the toy a burden rather than a blessing. If you buy toys outright they can sit parked if you lose a job or any other normal life fiscal risks come along, and you won’t feel nearly as bad about it as writing that monthly loan check. ***

4. The engine fund IS maintenance. Just deferred maintenance. Every time you start the engine you’re removing life from the aircraft. Not optional. You either have the money saved up when it needs it, or the airplane gets parked. Doesn’t matter if you keep it in an account marked “engine fund” or some other account, but you need the ability to replace or repair the engine tomorrow if it eats a valve. Or if you don’t, your options become severely limited. You either have a nice 3000 lb paperweight or you fix it.

Going back to number one, it has a benefit if you’re willing to eat the instant depreciation of avionics and want the stuff, but can defer pleasure for a little while. You can save money for a couple of years above and beyond the maintenance costs and future engine replacement and buy it exactly how you want it, while still flying something within your budget.

See note about mandate above also, you have a deadline for ADS-B if you’re flying in that airspace. So you’d need to decide if you’re saving up that much money on top of flying expenses for roughly two years. Wouldn’t give yourself longer, avionics shops will be full if you wait to the last month. Most are currently booked out six months already. The numbers say there aren’t enough shop hours left to handle all the aircraft that will need ADS-B. Some people are already looking at being grounded for a while and don’t know it.

My gut feel if you want to go 150 is that an older Mooney in good shape will do the job cheaper than the Bo. Simpler systems and maintenance, smaller engine, less fuel. Your options are going to be very limited at that price point.

If load carrying isn’t a common need in your mission profile or lots of operations out of hot and high elevation airports, you might also look at Debonaires if you must do the Bo thing. I mentionit because they’ll do it, not because they’ll be cheap. They get pushed up in price just because they look like a Bo.

Also wouldn’t rule out a well built RV or other popular EXP if you have the aptitude to maintain it and/or local support of builders that know RVs. Gives you a ton more options for cheaper but plenty solid avionics and also maintenance savings if you’re willing to turn a wrench.

Finally I wouldn’t rule out co-ownership. Biggest bang for the buck is the first co-owner. 50% discount on everything and even two weekend warriors can find a schedule that works very easily. A 50% discount in a hobby is rare and is nothing to sneeze at.
 
I've been looking at planes for several months. The big challenge I've seen is that there have been no airplanes with my requirements in my price range - low time engine, modern IFR gps and fast for 50k. It feels like something has to give.

I'm not at all opposed to an RV, but I also see no RVs for 50k. I could potentially build an airframe for 25k, put a 25k engine in it and then add 25k+ of avionics, but I wouldn't be flying it for years...I do want to build, but I also want to fly now. For 40k, I've seen a Zenith 601 but neither IFR nor fast. The least expensive RV I see right now on controller.com is an RV-6 for 60k with 1500 hours on the engine. I have to go up to 80k to get an IFR RV-7.

My inclination right now is to finance the right ~$30k VFR M20C/E, upgrade the avionics, then put the rest aside in a fairly liquid investment as a reserve fund. I probably could buy the plane outright and upgrade the avionics, but I don't like not having a maintenance fund to take care of things that come up. I get what you're saying about the risk of financing, I think the risk is pretty minimal. On a 50 year old airplane, the depreciation is about $12/hour flown and that is almost entirely engine. Other than being upside down relative to loan/hull value, what am I missing?

Here's an example airplane - although I know virtually nothing about this one and it will probably be gone by the time I'm ready to go. I like the price, low time engine and it has a strikefinder, but would otherwise need a panel upgrade. I've done no other research on it. https://www.controller.com/listings/aircraft/for-sale/26309397/1965-mooney-m20c

The alternative is to be very, very patient. There was a M20C recently with a 430W, a strikefinder, and 900 hr engine for 35k. It needed interior plastic work, which I can probably do. Great deal and predictably it was gone in a few weeks.
 
bflynn said:
Semi-hypothetical situation - I don't know that it's 50k yet.

$50k available to spend on an airplane. Mission is 1) fast travel meaning >=150kts, 2) IFR training, and 3) currency, say 10 hours a month of time. A loan is permissible, but looking to keep the monthly costs under $1200. High time engines are also permissible, but I intend to fully finance an engine fund out of the 50k at $11/hour. So, get a 1500 hour engine and you take $16,500 out for the engine fund.

An early model Mooney is desirable, something with manual gear. Maybe a Bo, but what's the maintenance cost?

Avionics target is GTN-650/750 + adsb transponder. A bluetooth connection for Foreflight would be really nice.

The combination of fast + avionics + low time engine seems to be tricky. I see 4 options, probably could come up with more.

1) Buy an engine with a low time engine straight out. Accept old IFR instruments.
2) Buy the avionics I want, plan to replace an engine within 500 hours
3) Finance the plane, get low time engine, install new avioncs
4) forget the engine fund, buy the best I can.

Your thoughts?
Click to expand...

Engine reserves are silly, it's right up there with reading tea leaves.

Also I don't know what you mean by old avionics, are you talking legit old like a king stack and a ADF, or tesla demographic old like a 430W and a stec?

Upgrading avionics is a fools errand, adding some small thing is one thing, but planning on redoing a whole panel is how you end up way upside down in a plane in a hurry.

Buying a timed out engine, unless you really know some good deals on a OH or swap, I'd stay away from that too.

Buy a plane that is as you want it, if you can't afford that, look at a less expensive type of plane.


For your price point you should be able to get a sweet PA24 that will meet stated mission very well.


After about 60 seconds of searching

image.jpg

https://www.trade-a-plane.com/mobil...ANCHE+260B&listing_id=2323046&s-type=aircraft

"
General Specs
Total Time:4,579

Engine 1 Overhaul Time:737 SMOH

Prop 1 Overhaul Time:118 SPOH

Condition:Used

Interior Year:2008

Flight Rules:IFR

# of Seats:4

Detailed Description
1966 Piper 260B Comanche, 4579TT, 737 SMOH, 118 SPOH, June 2018 Annual, Garmin GNS 430, Narco Com 810+R, Narco AT-150 Transponder, Narco Nav 122 Altimatic IIIB (Altitude Hold Inop). Based At Republic (FRG)."


image.jPg

https://www.trade-a-plane.com/mobil...MANCHE+260&listing_id=2190239&s-type=aircraft
"
General Specs
Total Time:5,892

Engine 1 Overhaul Time:200 SMOH

Condition:Used

Interior Year:2008

Flight Rules:N/A

# of Seats:6

Detailed Description
1967 Comanche 260, 5892TT, 200 SMOH. KT76 TSO Transponder, Bendix King Dual Digital Com, Garmin 400, AP with Alt Hold Coupled.
Avionics / Equipment
EDMJPI700 Engine Analyzer
KT-76 TSO Transponder
Bendix/King Dual Digital Com
Garmin 400
Autopilot with Altitude Hold Coupled To GPS
Storm Scope
Push Talk
Autopilot Button Disconnect
Radio Control Panel
King Analog Dual Band
KNS80 NAV
ADF

Electronic Trim
Rudder Trim
Alternate Air Alternate Vacuum
Radio Control Panel
Toe
Brakes and Johnson Brake
Clock
Factory Reserve Total 90 Gallon
Airframe
5892 Hours Total Time
Engines / Mods
All Speed Gap Mods
Speed Cowling with Matching 3 Blade Prop
Remarks
All AD's
Fresh Annual
All Log Books"
 
Last edited:
Congratulations, you've earned your way off being ignored.

Ancient IFR means a LORAN and ADF. A 430 + strike finder is beautiful, although I don't see ADSB.

It's not a bad find, it's a Piper, although the 8 cylinder engine will make operating costs challenging. I'm calculating about $100/hour for fuel.
 
bflynn said:
Congratulations, you've earned your way off being ignored.

Ancient IFR means a LORAN and ADF. A 430 + strike finder is beautiful, although I don't see ADSB.

It's not a bad find, it's a Piper, although the 8 cylinder engine will make operating costs challenging. I'm calculating about $100/hour for fuel.
Click to expand...

Comanche 400?
 
bflynn said:
Congratulations, you've earned your way off being ignored.

Ancient IFR means a LORAN and ADF. A 430 + strike finder is beautiful, although I don't see ADSB.

It's not a bad find, it's a Piper, although the 8 cylinder engine will make operating costs challenging. I'm calculating about $100/hour for fuel.
Click to expand...

Those are not 8 cylinder engines, that's the PA24-400

Still adding ADSB, especially if you can wait a little would be something I'd be OK with.

Think depending on everything that second PA24 might be a good buy if you can get it for closer to 50k. The first one ain't bad ether, but I'd really look at the PA24 line, very simple aircraft, they fly beautifully, comfy and wide inside and they are a super bang for the buck.
 
Hmmm...ok, got bad information on the engine. I'll have to take another look.
 
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