Surviving on a New Pilot’s Salary (i.e. $25,000)
Most new airline pilots can expect to make less than $30,000 a year during their first year. Here are some tips on how to get by with such a low salary.
It may come as a shock to many people outside the aviation industry, but professional pilots are all too aware of the low starting salary of first-year pilots.
According to the Air Line Pilots Association (ALPA), many first-year pilots can expect a starting salary of under $30,000 per year. In fact, just in 2014, reports indicated that the average starting salary for a pilot at a regional airline was $21,000 per year.
Cost of Training
First, let’s establish that starting a professional career in aviation is a substantial investment. To earn your Private Pilot’s License in a small, single-engine airplane, the costs can range anywhere from $8,000 – $10,000. Adding in the costs for other necessary licenses, ratings, and endorsements a professional pilot needs, and costs can well exceed $50,000.
If attending a 4-year university for flight training, student pilots will also incur costs for additional coursework. My education at Purdue University cost well over $100,000.
While there are ways to reduce the cost of your education by applying for scholarships, grants, or working part-time jobs, most new pilots will use debt to finance their training.
Once a pilot has earned all the certifications he or she needs, focus then shifts to building the flight hours needed to get hired at an airline. Most pilots build their hours by flight instructing or flying short charter trips; neither of which pay much.
As if carrying student loans or debt from flight training wasn’t stressful enough, low starting salaries can add another layer of financial stress to a new pilot.
As you can see by the salary numbers above, new pilots at these airlines can expect to make less per year than a full-time fast food employee where the minimum wage is $15.00/hr….don’t get me started.
Here are some tips to get by on a salary of $25,000 a year until the airlines raise your pay or you work your way up the seniority list.
Build Your Flight Plan
Also known as a budget, it’s important to take an inventory of your expected income and expenses each month. “Budgeting” doesn’t have to be a bad word. Too many people think budgeting is about restriction.
Think of your budget as your financial flight plan. This is a tool that will help you get to your destination efficiently and in one piece.
Your destination can be whatever you’d like, but make sure you have something in mind. It could be getting out of debt or not taking on new debt, saving for a vacation, or just making it past your first year in the airlines.
I have found the “envelope method” of budgeting the best way to keep track of my spending. Dave Ramsey gives a great explanation here.
You don’t have to physically put your cash in envelopes, unless you have a problem with overspending. By giving every dollar a job, you might sleep a bit better knowing exactly which expenses will be covered by the money you already have.
I personally use the YNAB (You Need A Budget) program to budget. It does a great job keeping track of your “envelopes.”
Cut Your Expenses
More income is not usually the right answer to money issues. Especially for people with out of control spending habits, more income leads to more spending.
By budgeting properly, you will have an understanding of how much money you need each month to cover your expenses. If you come up short, your first action should be identifying areas to cut spending.
Take a look at each category on your budget and ask yourself if there are ways to reduce that expense.
Do you pay for a gym membership each month? Consider working out at home or in your hotel room instead.
Do you pay for an expensive cable service you rarely use? Cutting cable can be a huge savings each month.
Can you eat out less? Could you walk or ride your bike instead of driving?
You might be surprised at the savings by chipping away a few dollars here and there from each category.
Research Income Driven Repayment Plans for Student Loans
If you have student loans, you may benefit from enrolling in an Income-Driven Repayment Plan. These plans will cap your student loan payments based on a percentage of your income. Any amount remaining after a 20 or 25-year term payoff period will be forgiven.
For example, a single person making $25,000 a year would have a student loan payment between $60-$90 depending on your repayment plan.
Having a lower student loan payment can help you focus on important expenses such as rent, food, and clothing.
Generally speaking, the faster you can pay off your loans the better, but certain people may benefit from staying on an income-driven repayment plan. There are many things to consider such as your income growth potential, income from a spouse, and planning for any tax consequences to forgiveness.
If you need help deciding what payoff strategy is right for you, check into our Student Loan Analysis Service for more help.
Find a Side Hustle
If you don’t have any more expenses to cut, or you just want a little extra spending or savings money, then consider finding a side hustle.
An important disclaimer: Don’t do anything that could jeopardize safety.
One notable example is Colgan Air Flight 3407. This flight crashed on February 12th, 2009 killing all 49 people on board, and 1 on the ground after the airplane stalled.
The NTSB cited pilot fatigue as a possible contributing factor to this accident. It is now well known that these pilots worked second jobs or lived with parents just to get by on the low airline salary. The co-pilot, Rebecca Shaw, commuted from her parents’ house in Seattle to her home base of Newark, NJ just to save money.
Sometimes we have to do what it takes to survive, but never do so at the risk of your crew or passenger’s lives.
Look for options that don’t necessarily require you to work in an actual office or store such as a retail position. Working retail hours can be physically and mentally draining, plus if you’re gone for 2-3 days at a time it will be difficult to schedule that work.
If you feel like you could help other people with your knowledge, consider starting a blog or creating a course. You don’t need to be a top blogger, but even an extra $500-$1000 a month would go a long way.
The best aspect of these jobs? You can work when you want and from the comfort of your home, hotel room, or pilot’s lounge. Selling information can provide decent income without a lot of on-going effort.
It’s Only Temporary
It’s good to remind yourself that the situation is only temporary. Hopefully you are enjoying the thrill of flying even though your pay may not be where you would like.
Soon enough, you will build your seniority, and your wages will increase with you. As your income grows, revisit your budget to see where changes can be made. You might be able to start paying off debt faster, or saving for a new home or vacation you’ve always wanted.
Have you struggled with getting by on a low salary? Share your tips in the comments below!
About the Author
After graduating from Purdue University in 2009 with a pilot’s license and a degree in Aviation, Dan Kellermeyer had over $100,000 in student loans and faced a virtually non-existent job market for new pilots. Today, Dan is free of consumer debt and is passionate about helping others finding the best way out of debt and planning for the future.