E335 - State of the Industry and Your Finances with Jim Higgins & Elise Dominguez

Avination, welcome back to Episode 335 of the Pilot to Pilot podcast! Host Justin Siems sits down with aviation expert Jim Higgins, a former airline pilot and University of North Dakota professor, and Elise Dominguez, a Certified Financial Planner at Allworth Airline Advisors, for a deep dive into the airline industry and pilot financial planning. They unpack the cyclical nature of pilot hiring—citing 12,000–13,000 pilots hired in 2023–2024, now leveling to a still-strong 4,000–4,500 annually, per FAPA data. Justin shares his journey from a fractional company to a major airline, facing a $120,000 pay cut, while Jim reflects on his wife’s choice to stay a senior FO for schedule flexibility. Elise offers actionable advice for pilots at every stage: new hires like a 24-year-old check airman should start saving early to leverage time, mid-career pilots should max out 401(k) contributions (increasing by 1% yearly) and diversify with Roth IRAs or taxable accounts, and those nearing 65 should explore catch-up contributions ($7,500 at 50, $11,250 super catch-up at 60–63). They also tackle the pilot retirement age debate—will it hit 67?—and how it impacts young pilots’ seniority or senior pilots’ earnings. From avoiding lifestyle creep to planning for “what if” scenarios like furloughs or early retirement, this episode is packed with insights to keep your aviation career soaring. Visit Allworth Airline Advisors for a free consultation to build your personalized financial plan!

I hope you enjoy this podcast and if you're interested in reaching out for more financial information make sure you check out Allworth Airline Advisors!

Hope to see you all at EAA Ariventure!

Justin

Takeaways:

• The state of the airline industry is currently experiencing a hiring slowdown compared to the record-high years of 2023 and 2024, but opportunities still exist.
• Elise emphasizes the importance of starting financial planning early in a pilot's career to build a solid foundation for retirement and future investments.
• It’s crucial for pilots to diversify their investments outside of 401(k)s to avoid over-relying on employer-sponsored plans for retirement income.
• Discussing the emotional aspects of financial decisions is important, as pilots often need guidance to navigate the ups and downs of their careers and personal finance.
• Investing in a health savings account can provide significant tax advantages, especially for pilots with high deductible plans, making it a smart move for long-term financial health.
• Addressing the potential changes in the retirement age from 65 to 67, it's essential for pilots to consider the impact on their career plans and future earnings potential.

What is Pilot to Pilot?

Pilot to Pilot is the podcast for anyone who flies — or dreams about it. Host Justin Siems sits down with airline captains, bush pilots, CFIs, and everyone in between for honest conversations about the path to the cockpit, the grind of the career, and the love of flying that keeps us coming back. Whether you're a student pilot chasing your first solo or a captain with 20,000 hours, there's a seat for you here. New episodes weekly.

Episode 335 of the Pilot the
Pilot podcast takes off now.

AV Nation, what is going on?

And welcome back to the Pilot
the Pilot podcast.

My name is Justin Seams and I
am your host.

Today's episode is an Allworth
Airline Financial webinar episode.

If you weren't able to make
the live, I had a lot of people message

me, hey, I want to listen to this.

I want to watch this, please.

How do I find this?

So if you weren't one of the
the many people that signed up for

the live, which is awesome to
have you there and you asked some

awesome questions, we have the
posted version right here.

This is a state of the
industry as there is Jim Higgins

on here and we have a lease to
talk about what a pilot should do,

finance size.

Because you know, Jim and I,
we're not financial gurus.

We do not know what 400 okay
to invest in Roth or traditional

whatever it is, but Elise does.

So she's here to help you
understand what you do when you're

a new hire, what you do in the
middle of your career.

And we also talk about towards
the end of your career.

And if you like any of this
information, you can head to Allworth

Airline Financial and you can
click on Pilot the Pilot.

There also should be a link
for this description as well.

They'll take you straight to
their site and and you can go ahead

and set up a call.

It's a free consultation and
they'll tell you how they can help

you because I promise you,
they have helped me.

So go ahead and check them out.

But AV Nation, I'm excited for
you to listen to this episode.

It is a great one.

As always.

It's great to have Jim and
it's also great to have Elise on

as well.

AV Nation, I hope you really
do enjoy this and click the link

below to schedule consultation.

Like I said, I'm also looking
to get some new interviews coming

out here soon.

I know that the last couple of
months haven't been the greatest

for content and we are going
to change that.

So thank you so much for for
standing by asking me what's going

on, but maybe we'll we talk
more about that in future episodes,

but right now it just is what
it is and we look forward to producing

some more episodes here soon.

So without any further ado,
here's a state of the Airline industry

with Jim Higgins and Elise.

Hey everyone, Justin Seams
here, host of the Pilot the Pilot

Podcast and I want to welcome
everyone to today's webinar, the

State of the airline industry.

Whether you're flying today or
getting ready for your next bid or

planning your next chapter in
your career, we're glad you made

the time today.

There's a lot that we're going
to cover and I'm very excited to

get started today.

I want everyone to have the
opportunity to hear from our speakers,

hear from the people we have
today as it's going to be very, very

valuable information.

A little bit of myself.

I host the Pilot the Pilot podcast.

I recently went from a
fractional company to a major airline

so we can talk specifically
about decisions and why one would

choose and make that decision
after being seven years into a career

and why I thought it was the
best choice.

And then we're also going to
follow along a timeline of early

in your career, middle of your
career and end of your career of

how you should invest, what
you should thinking about.

We have a lot of good
information and I'm very excited.

First, I want to go ahead and
introduce the two guests that we

have.

They're gonna be on for the webinar.

We have Jim and Elise and
we'll have them go ahead and introduce

themselves.

So Jim, if you want to start
off and then we'll have Elise say

something as well.

Thanks, Justin.

I'm Jim Higgins.

I'm a professor of aviation at
the University of North Dakota.

Been talking with Justin since
the beginning of COVID about all

things aviation related.

Former airline pilot, now
turned professor.

But before that I've also
flown corporate and I've flowing

freight and I was also heavily
involved in the Airline Pilots Association's

Master Executive Council at
American Eagle Airlines, now known

as Envoy.

So I was the MEC chair there.

So happy to be here and
looking forward to the conversation.

Good afternoon.

My name is Elise Dominguez and
I am one of the financial advisors

here at All Worth Financial
Allworth Airline Advisors.

I am a certified financial
planner, CFP professional.

Most of the clients that I
work with are airline pilots.

So I'm really looking forward
to being part of this conversation

with Jim and Justin today.

Now for the disclaimer.

This presentation is for
general information only and shouldn't

be taken as personal advice.

Things may change over time.

And as always, consult your
financial, tax or legal advisor for

guidance specific to your situation.

All right, Jim, Elise, thank
you so much for coming on today for

the state of the industry.

Jim, it's been a while since
we talked.

There's a lot going on.

I figured today we can kind of
start and break in and dig into what's

going on in the industry.

So do you have anything that.

Since we last talked about, I
mean, we really focus on spirit,

We've talked about some of the
other major hiring pauses and we've

talked about what's going on
with regionals and how some regional

CEOs don't think that there is
actually a pilot shortage anymore.

So is there anything else that
you're seeing over at University

of North Dakota or anything
that you're reading?

Yeah, it's.

It's quite an interesting
time, right?

It, it.

Sure.

It sure seems relative to
recent times.

Sure seems like the pilot
hiring has trickled or froze or it's

not what it used to.

However, we just have to go
back to the year 2000, all the way

up to present.

You know, an average year,
there's about 3,400 pilots that are

hired at the largest carriers.

That's according to some FAPA data.

But that's been really skewed
because in 23 and 24 we had 12,000

and 13,000 pilots hired during
that time.

We've now returned back to
about 4,000, 4,500, which still historically

is high.

I mean, this year alone,
believe it or not, at the largest

legacy carriers, we could have
the third or fourth best year since

2000 in hiring yet, because a
lot of people are comparing it to

23 and 24, it seems like we're
in a famine of hiring.

And so again, it's just all relative.

You know, you and I have
talked about this so many times,

Justin.

Whenever times are really,
really good for pilots and the floodgates

are open and everyone's
getting a job everywhere, everyone

just assumes it's going to be
like that forever.

And then on the other side of
that, whenever there's no hiring

going on and there's furloughs
and all kinds of problems, everyone

assumes this is how it's going
to be forever.

But you and I both know we've
been in the industry now long enough

that it's very cyclical.

And, you know, we've kind of
regressed back to the mean, but there

still are good opportunities
out there.

I still believe it's a great
profession, but certainly we're seeing

some variation year to year.

Yeah.

And I have a buddy who is 24
years old.

He is a Czech airman at a
regional airline, which, I mean,

me saying that to you, you're
probably like, holy smokes, how's

it even impossible?

He's making more money than me
as a second year major fo.

And he, he actually was turned
down for.

For a major job.

And it was kind of his first
disappointment in his career.

And I was kind of explaining
to him, I was like, dude, you are

very, very young.

I guarantee you, if you were
on the phone with a lease, you'd

be like, look, you're going to
have many opportunities.

We're going to be able to set
you up for retirement.

You're gonna have the best job
you can possibly have.

It's going to happen.

It's going to happen soon.

Um, we just got to stick in there.

And it's kind of part of the process.

Right.

Like, being turned down in the
past was not uncommon.

Right.

It was kind of just luck of
when you interviewed.

It is not necessarily bad on
you as a prospective candidate.

It's more of just, kind of
just luck.

Right place, right time, right?

Absolutely.

There's no doubt about it.

There's definitely an element
of luck.

People have to be prepared.

They have to go through the
process to make sure they put their

best foot forward.

But certainly you and I both
know some great candidates in the

years past that have been, you
know, rejected.

And, you know, it's painful
and it's difficult.

It allows for a lot of introspection.

But again, you know, your
friend's not in a bad place at all.

24, you know, that's.

I couldn't imagine to be 24
and be a Czech airman at a.

At a regional.

He's doing great and has a
very bright future.

And hopefully everyone that's
listening to this realize that, realizes

that as well.

Yeah.

I mean, when I was 24, I think.

I don't even think I had all
my ratings.

I was working part time at the
Apple store trying to finish all

my ratings.

I was making like 12 bucks an hour.

So he's definitely doing way
better than I was at 24.

No doubt.

And it's just going to get better.

Yeah.

And, Elise, when you see
someone that's 24 years old making

the kind of money that someone
is at a.

At a regional and they're
getting ready to make the transition

to a major airline, I would
imagine you're like, wow, you are

in such a good place to start
for saving, start for retirement,

if you haven't already.

But it's like the amount of
money that some of the younger generation

is making right now has to be
kind of awesome for you all to see

and just see that, wow, we can
really help you and we can really

set you up for a good future.

Right.

No, it's funny because I work
with many Pilots, you know, some

who are just starting in their
careers and others who, you know,

are approaching age 65.

And it's kind of funny hearing
the 65 year olds I work with saying,

oh, you know, these youngins
are earning a lot more than I ever

did in my career.

They're starting off a lot.

You know, I'm retiring with
what they're making right now.

But it is a cool perspective
and it just brings it back to the

focus that it's never too
early to start planning for financial

planning, you know,
retirement, 65, 67, whatever that

age is, you know, it's never
too early.

And being 24 years old and
having that income potential and

just a long career ahead of
them, it's really exciting.

And never too early to start
thinking about retirement and then

also diversifying your assets
outside of retirement.

Right.

We don't want you to feel like
all of Your money's in 401ks and

IRAs, because you're going to
want to purchase things throughout

your, throughout your younger
years as well, which is, it's a good

way to, you know, bring in
conversations about diversing your

assets outside of just 401ks
and retirement accounts.

Yeah, absolutely.

I mean, those are
conversations that I've had with

Gary, who helps me with my
401k, who helps me with my investments,

who Gary was on this last time.

You've heard Gary on the
podcast as well.

It's been great.

And I wish I had that at a
younger age.

I mean, even when I was
working at Apple part time, just

knowing what I could be
getting into.

Because the mindset of saving
and the mindset of retirement and

mindset of just kind of
setting yourself up for the best

success is huge to start early.

And I probably start a little
later than some, but still earlier

than others.

But it's very important to
kind of have that mindset when you

agree.

Yeah.

And I, I can, I can just add
to that too, Justin, when one of

the things we talk to our
students about because we get those

really early, early entrants
into the industry, time value of

money, which is just something
that's so misunderstood by so many.

And it's not just a pilot
centric thing.

I think it's just maybe I
didn't know much about it.

I always knew you should save
money and put money away, but, but

I'm not a financial planner at
all, so Elise may completely object

to what I'm about to say, but
I think if you do things well in

your 20s and 30s, you've
really got a foundation to kind of

coast through your 50s and 60s
into retirement and be very confident

financially that things are
going to work out well.

On the other side of that I
was just listening.

You know, we've talked about
social media.

There was a, my daughter
showed me a tick tock or an older

gentleman the other day who
didn't save throughout his career

and he's 65 now and he's
looking for jobs and he's relying

on Social Security.

And so it doesn't take much
to, I think if someone were to see

that other side of it where
you don't plan well, it doesn't take

much to scare you and to you
better do the right thing if you

possibly can.

And like you said, all these
programs are available, the pays

there, the salaries there, now
starting salaries are there.

So there really is no excuse
to not have some very good retirement

options early on and get
compounding interest to work for

you.

Yeah, the best part about
younger individuals who are starting

in this profession is the
greatest gift that they have is time.

Like you mentioned, that time
value of money earning interest,

you have those in that
investment potential.

In the event of a down market,
you have that time horizon to recover.

So it really is a really
unique thing just knowing that, you

know, the value of a dollar or
the value of a dollar today is greater

than the value of a dollar in
the future because the profit that

it can earn, you know.

So yeah, totally agree.

And Jim, with some, with
getting back on kind of some current

events, JetBlue came out
yesterday, they mentioned cutting

of services.

You know, if you're a pilot at
JetBlue or say anywhere, I mean right

now the market, it just seems
like it's up in the air.

Right.

Like everyone for the last
four years has been like the recession's

right around the corner, the
recession's right around the corner,

like it's, it's going to happen.

But as someone who's been
reading a lot in the industry, what

would you kind of make of what
JetBlue has come out and said or

what is going on with Spirit?

Yeah, well, you know, when we
look at the ULCCs in general, you

know, I believe we're now
seeing some pretty strong evidence

that that business model is
being exposed.

You know, you and I talked
about this the beginning of COVID

and I told you I think it's a
pretty strong business model.

You know, they have the
ability to ramp up through ancillary

revenue.

They're able to withstand
downturns and you know, capacity

problems.

But I Don't think that's true.

And you know, of course we've
heard some of the main mainline CEOs,

like Scott Kirby's one saying
that he, I mean this is a direct

quote.

The business model sucks for us.

They can't make money.

And I always thought it was
kind of wishful thinking maybe from

a mainline.

But we have some strong
evidence, we have the spirit bankruptcy,

the chapter 11.

They're going through that now
and hopefully they're going to be

able to emerge.

They have a plan that's been
approved by the trustee.

You do have the JetBlue.

JetBlue used to be very
profitable even through 9 11, all

the way through the Great Recession.

They always were able to turn
a profit until just recently.

And so you got to kind of
wonder, gosh, you know, are they

is the ulcc?

And then of course you can't
look much further than Southwest.

They're reinventing themselves.

Southwest is now doing baggage
fees, they're now doing premium se.

They're redoing their entire
revenue management structure for

fares.

Things that we, you know, I
mean, remember the bags fly free

and you know, Southwest used
to have these massive campaigns.

Well, they've completely
abandoned that and bags do not fly

free there anymore.

And so they're basically
reinventing themselves into the mainline

model.

My point in all this.

And of course then you've got
the united JetBlue partnership that

was just announced as well,
which is very interesting.

You know, so all of this is
pretty strong evidence that there's

some problems with the ULCCs.

The one exception seems to be
Frontier and Allegiant.

I guess two exceptions.

They seem to be keeping their
head above water.

And while they haven't been as
wildly profitable as they have been

in the past, they have seemed
to solve that.

Part of that might be the
route, structure, their equipment,

you know, things like that.

But we are seeing, I believe
we're seeing some exposure on the

ULCCs.

Now that doesn't mean people
should jump ship and leave, leave

one of these carriers and go
somewhere else.

It just means that when you're
taking your long term career plans,

keep in mind that these
business models may have to change

over time to, you know, make
sure that the company stays profitable.

Yeah.

And Jim, as you've seen in
your career here, there's very rarely

do you jump from airline to
airline unless there's bankruptcy,

unless there's furloughing,
unless there's just some kind of

economic reason to do it as of late.

And as of the last five years
I mean, I personally have had friends

or I've seen people, whether
it's Instagram, Whether it's on YouTube,

some influencers, they've been
talking about how, you know, I'm

going from United to Delta,
I'm going from Delta to United.

You know, you see a lot of
more of switching between airlines

where before it was kind of
like, oh, my gosh, I made it, we're

here, I'm never going anywhere else.

What do you think about that with.

When it comes to financial
planning as well?

And at least you can kind of
come in as well, because I'm sure

you've seen those kind of
questions too.

But what kind of.

What would you put on the
basis of staying at an airline?

Maybe someone that's out of
JetBlue or that's out of spirit,

versus going into a different
major that seems to be doing better

now.

And at least you might be able
to start off just explaining kind

of the risk that you can go.

You know, seniority, you're
top of the pay scale, starting at

the bottom can be a big deal for.

For some of your finances and
how you live.

Yeah, no, that's a great
point, Justin.

And I'll just use an example
that I had with one of my clients

I was working with.

He is currently at Spirit.

He has been at Spirit for many years.

He doesn't want to jump ship.

He enjoys his, you know, his
base, it's home.

That's where he's at.

And then also his family
lifestyle, like you said, having

that seniority there, he
doesn't feel comfortable leaving

that yet.

So he's like, I'm riding the
wave until, you know, it crashes.

But in all seriousness, it
allows us an opportunity to review

his financial plan from a
perspective today.

And it also lets us create
what if scenarios.

Okay, well, what if you were
furloughed or what if you retired

early, you know, 10 years
earlier than you were expecting?

How does that impact your plan?

And we even created a second
scenario scenario of him moving to

Allegiant just to kind of see
what you would.

What it would look like, you
know, starting with, you know, for

fo pay, first year pay, how
would that impact you as far as a

financial perspective?

You know, so I think that was
a really unique opportunity that

ultimately provided peace of
mind knowing that if you were to

stay at Spirit, of course we
have this baseline plan, but if you

were to move to Allegiant,
you're still okay because of the

hard work that you have done
so far in your plan to Make.

If you had to make a switch
because of this, you're still okay.

And that provides peace of
mind and kind of goes back to that.

It's never too early to start
because there's a lot of things out

of our control.

But what we can control is,
you know, the inputs that we put

in the event that there is a change.

So that was a really unique
opportunity to.

To see on my end too.

And it helps provide some
peace of mind and some sleep at night

knowing that it is going to be okay.

Yeah.

I would just add that in
addition to making sure that you

involve someone like Elise to
go through and financially plan any

kind of transition like that,
that, you know, where you end up

working, where you start
working transitions like that's a

deeply personal decision.

There's a lot of variables
that go into it.

Probably one of the biggest
variables is location.

Right.

You know, a lot of people.

I mean, I commuted half my
career and I lived in base half my

career.

And I tell you, and I know,
Justin, you're fully familiar with

this as well, you know, it's a
lot easier when you can drive to

work than when you have to fly
to work.

The stress level goes
completely down.

And so, you know, there are
people that have to make some tough

decisions.

Maybe they're in base at a.

At a Spirit or at a JetBlue,
but they have an opportunity to go

to an American United Delta,
and they would have to commute.

And that, you know, that in
addition to all the other variables,

the pay, the retirement, you
know, the benefits, everything else

that goes into it, but that's
gotta be factored in as well.

And, you know, do you have
kids that you want to be home with

and, you know, go to their
sporting events or their other events?

These are all things that, you
know, you have to.

You have to balance.

It's the number one question I get.

I'm sure it's one of the big
questions you get is where should

I go and work?

And my answer is always the same.

You know, that's really a
personal decision based on, you know,

at least a dozen factors I can
think of off the top of my head,

with one of the biggest ones
being lifestyle in terms of commute

versus not commute.

And so it just depends, you
know, if I'm pretty senior at JetBlue.

That's a difficult.

That's a difficult.

You know, maybe I live in, you
know, in Kew Gardens right now.

You can drive to.

Drive to work at Kennedy or
whatever, and.

And it's working out well.

For me, you know, and I can't
get that base.

Maybe I'd have to go to
Atlanta at Delta or something like

that.

I, you know, I think it'd be
very tough for me to move unless

I'm convinced that my
company's on the path to bankruptcy,

which, in the case of JetBlue,
I think that that's.

That's very unlikely.

Yeah, agreed.

I always ask my buddy.

He's like, my JetBlue guy.

Anytime I get news, I'm like,
hey, what's going on?

He's like, dude, we're fine.

Stop asking questions.

All right, Sorry.

I just want to know, but going
back to what you said about kind

of moving airlines and picking
what's best for you, I think a lot

of it kind of ego and pride
gets in the way, too, because, I

mean, some people think, I
mean, when I was at my last job,

I'd be like, I'm a pilot.

Like, who do you fly for?

I'm like, I fly a fractional.

Like, oh, well, when are you
going to go to the airline?

You know?

Or if you say you fly for
Spirit, like, oh, when are you gonna

go fly for United?

It's like, you kind of have to
get past that.

Some people think that flying
for a certain airline is a better

job, when in reality, they
don't know your personal situation.

They don't know that one, you
can make a good amount of money at

Spirit, and you can drop
pretty much all your trips and have

the best quality of life,
which is the most important thing.

And maybe at least one agree
with that.

Maybe the most important thing
is planning for your future and your

retirement.

But dropping trips and being
able to choose when and where you

want to work, I mean, that.

That really means a lot,
especially if you have young kids

or you have a family or if you'.

Just.

Maybe you just want to go hang
out and go surf, I don't know, wherever

you live.

But it's very important to
kind of understand what is the right

job for you and for your family.

When I was at my fractional,
it worked out really well for us

for time being.

When my wife was in medical
school and we didn't know where we

want to live, the fractional
let me live anywhere in the country.

And we were able to move to
her residency job, and then we were

able to set roots and figure
out, all right, North Carolina is

where we want to stay.

Now let's look for the best
airline that we can go to.

And, I mean, most people would
imagine that's American because of

the big Charlotte base.

Now, if I'll ever get
Charlotte as a base.

That's yet to be determined.

But, you know, New York's not
so bad.

I'm getting used to it.

When you said Kew Gardens, I
kind of, like, shook.

I was like, oh, my gosh,
that's too real right now.

No, I'm just kidding.

A lot of crash pads in Kew Gardens.

Yeah, a lot of crash pads.

But thankfully, short call era
of my career in New York seems to

be over.

And I've been able to hold a
line the last two months and it's

been great.

I've really enjoyed it and the
flying's been awesome.

And everyone that we fund those.

Awesome.

Elise, I wanted to ask about,
what's your recommendation?

Say someone is at an airline
that's in bankruptcy.

Or maybe they're like, hey,
like, I don't know if I trust where

I'm at.

I may be.

They're.

They're a junior captain.

Maybe they've been there for a
while, but they're just kind of like,

hey, I'm thinking about
jumping to a different airline.

Do you kind of give them, like
pause and be like, hey, just really

think about it.

Like, don't jump to conclusions.

Don't just do it because you
think something's going to go bad.

Like, we really need to see
what's going on and if it's worth

the risk.

But what kind of do you
recommend to them when they're in

those situations?

Yeah, you know, and a lot of
financial planning is emotional based

too.

Right.

And you know, you hear about
emotional investors and people get

worried, so they sell
everything or move everything to

cash.

Right.

That's just part of who we are.

That is what we're made of.

We are, we're emotional,
emotional investors.

And that also can impact
decisions where we have a moment

of panic.

And it's like, okay, well, I'm
ready to move.

Let's do.

Let's do something else, or
I'm ready to leave.

I really encourage my clients
in the.

The wonderful pilots that I
work with is just to take a step

back, let's breathe.

What is keeping you up at night?

Because that is ultimately the
biggest decision maker.

We don't want you to lose sleep.

We don't want you to be stressed.

So of course, I walk them
through the financial perspective.

Okay.

Like, this is where you're
currently at right now versus, let's

say you did move to United or
Delta or you have.

I had a couple of clients who
were interviewing and they're like,

hey, I have a couple of offers.

Which one should I go to?

It's like, okay, well, let's
take a step back.

What is important to you?

Oh, well, I have young kids
and, you know, they're in middle

school and I like going to
their baseball games at night or

whatever that is.

Okay, that's important.

And really what my job is, is
to make sure that emotionally we're

making the best decisions and financially.

But at the end of the day, the
airlines are very generous with their

benefits, so we always factor
in that.

And of course, there might be
a little bit of a pay difference

whenever you move to an air.

So that just involves a little
bit of budgeting.

Right.

And sometimes we have to give
up a couple of things in order to

make that work.

It's a struggle in the beginning.

It absolutely is a struggle in
the beginning.

And this is a little tidbit.

I'll add.

Something that Allworth
Financial does offer is if one of

our clients are at a, you
know, a regional and they're doing

really well there, and then
they move to a legacy and they're

a first officer.

Of course you have that pay adjustment.

We actually do offer free 401k
management for the first year while

you're at that new airline.

So that's something that has
really brought in a lot of people.

And they're like, wow, like,
this has really helped, you know,

set the foundation.

And as I continue to build
seniority and build my year pay scale,

this is something I didn't
have to worry about is, you know,

paying for investment management.

So I know I'm going off on a little.

On a little tangent here.

I think that's great because I
mean, I recently have switched and

I went from, I think I took
$120,000 pay cut my first year, going

from where the fractional is
at to the airline I was at.

I mean, that's a lot of money.

And I think you can kind of
just like think everyone else does

it.

It's okay.

But like, when it hits you and
you see your paycheck, you're like,

oh, wow.

And it's.

It's really hard to, to kind
of reduce your lifestyle, right.

When you get used to living a
certain way, buying the things you

want to buy, and if you don't
save properly, then you might be

able, you might have to make
some changes.

And that's very difficult.

And it's not just for
personally family, right?

Like telling your kid, oh,
okay, let's not do that.

And then on the Flip side of
it, when you.

You go to say you're Sam in a
crew environment, I'm getting ready

to fly a trip.

I'm a new guy.

I'm talking to the captain,
the guy, the girl I'm flying with.

I'm like, oh, man, it's just
been tough, you know, the pay cut

that I had to take.

And then they're like, whoa,
whoa, Whoa, you're making $125 an

hour.

When I started, I was making
$40 an hour.

So it's just, it's really
interesting because, like, you.

You can complain because it's
very valid, but when you complain

to someone that's senior,
that's been through 9, 11, that's

been through 08, financial,
been through all this, they.

They don't have much sympathy
for you.

And I mean, for good reason.

They've been through a lot.

Right.

The lost generation, they've
seen a lot of bad, Losing their pensions

and going to 401k.

And it's just.

There's a lot going on in the industry.

So I guess when I'm going off
on a tangent as well, but just be

careful who you complain to
when you make it to the airline industry,

because they will quickly
realize that, or you will quickly

realize that they're not going
to have much sympathy for you complaining

about making $128 an hour your
very first year.

Yeah, right.

And like you said, you get
used to that lifestyle and then,

you know, having to adjust and
go back to, you know, a B sheet,

and it's like, how much, you
know, am I saving?

Like, am I going to deplete my savings?

What does that look like?

And sometimes we have clients
that are.

They're the only one that's
working full time.

Right.

And their spouse is at home
taking care of the children.

And that's a big change.

And this is something that's
very common that I see with my clients.

And my big focus is just to
take a step back.

We'll view it from a financial
perspective, of course, but also

emotionally, what's important
to you.

And then sometimes that means,
you know, we have to commute.

Unfortunately, that's just
part of it, because they want to

still be able to support their family.

And that's a temporary thing
for them.

They're like, I just want to
get back on track.

And we have some who are like,
nope, I refuse to commute.

I'm willing to take that, that
pay cut.

So there's just a lot of
different factors to.

To think about.

Yeah, Justin, I have one Quick
anecdote to add.

I was talking to a captain the
other day of a widebody, and he mentioned

to me the best thing to do.

You know, pilots think they're
experts in so many things, including

financial planning, which is
funny, but.

But he was telling me that,
you know, if you want to do your

retirement right, you front
load against the IRS limits your

first three months.

So you get that whatever you
can, you know, 40, 50, 70,000.

I'm like, yeah, but what do
you live on?

He goes, well, you just.

You just save up.

And, you know, November, December.

I'm like, you know, these are
people completely.

You know, when you make
$500,000 a year, it's probably a

lot easier to front load,
something like that.

So it's just.

It's all based on people's
perspective and how they do things.

And one thing I do want to say
that Elise brought up earlier is

about this emotional thing.

We do have to watch out for
that with pilots.

I hearken back to my Y2K days.

Some of you may or may not
know what that was or maybe read

about it, but I was flying
with a gentleman that cashed out

his entire 401k and paid the
penalties and then bought gold because

he thought the world was
basically going to end.

And of course, we all know
what happened.

What a silly investment that.

I have no idea how he did
since then, but I know he lost a

lot of money in that.

So we do have to be careful.

One thing I've always said is
just like, no offense, Elise, I don't

know if you're a pilot or not.

I'm assuming not, but I
probably wouldn't want you flying

an iOS with an engine on fire.

But I also wouldn't want that
pilot giving me financial advice.

I'd want you giving me
financial advice.

And so that's what I always
tell pilots.

Get the experts, the people
that do it for a living, to give

you the best possible advice.

There's no guarantees.

But one thing I do know is you
and I, Justin, probably know a lot

of people that have really
loused up their retirement and their

savings and their financial
situations because they didn't know

any better.

And if you involve a
professional early on that does this

for a living, just like we do
flying, let's stick to flying.

Let the professionals come in
and do that.

We can avoid this emotional stuff.

We can avoid these Y2K stuff.

We can avoid all this other
stuff that we.

We see.

And so I think it's such a
great discussion to have.

Yeah.

And you're talking about
making emotional choices.

The last two pilots I flown
with were like, hey, sell everything

in your 401k, buy XRP, buy
Ripple by cryptocurrency.

Right.

It's the only way that you're
going to become rich.

At least you're probably going
to laugh at that.

But I mean, it is out there.

I mean, who's this?

I, I'm.

Who's to say he might be right?

Right.

Like, I'm not saying that it's
not something you should do, but

it's probably best to have a
conversation with someone that sees

the whole big picture rather
than the emotional kind of attachment

that someone can have to their
choices that they have made and they

talk themselves into this is
the best thing that's ever happened.

Right.

And it's easy to believe it.

It's easy to get into it,
like, oh, it makes a lot of sense.

But I think as Jim was saying,
pilots are notoriously bad at handling

money.

They're notoriously bad at
just buying crazy stuff.

I mean, I've seen people get
hired in a major airline.

They're buying a Rolex and
they're buying a new boat.

And it's like, I know what
you're making.

Like, I know that's not
possible right now, like, what's

going on?

So I think that's why it's
just beneficial.

And I tell everyone who I
recommend to all worth.

It's like, hey, just call them.

Right?

You get a free consultation call.

You can call them, you can
talk to them, and if you think it's

right, then continue the process.

If not, just hear them out,
hear what they have to say and then

go about your day.

Anything.

It's 45 minutes.

They can educate you a little
bit on what you can do and then you

can sign up.

So it's been very beneficial
for me.

That's all I'm say.

Good stuff.

Yeah.

And moving on, kind of, as I
mentioned there or in the beginning,

we're going to kind of take
you through the thought process of

what it's like to invest, what
it's like to be in the beginning

of your career.

You know, we can use me kind
of personally as an anecdote here

where I am new to a major airline.

I'm at the lowest end of the
pay scale.

You won't know how.

I'm in the second year pay, so
I moved up a little bit.

It was like $60 an hour raise,
which is awesome.

But at least when you get
hired by the major, you think that

you made it, right?

You see your life going from
first year pay to widebody captain

at age 65, making who knows
what will be by that time.

We'll say like 500, 600 grand
that some of these guys and girls

are making.

But what do you.

How do you slow someone down
that's like, all right, I made it.

Now let me live my major
airline life.

Let me live like a captain.

Let me live like the first officer.

It's making, you know, 200,
300, or the captain's making 300

to $500,000.

How do you slow someone down
and just be like, all right, yeah,

let's see what we can do?

Yes.

And that is so common.

And something I always love to
mention to my pilots is, you know,

just because we make money
doesn't necessarily mean we get to

spend more money.

We want to create really good
habits in the beginning.

So really, the first thing
that I sit down or what I think about

when one of my clients is
starting off at a legacy airline,

it's like, man, I made it.

I'm excited.

You know, I'm gonna stay here forever.

Really, the first thing I
think about is cash flow.

You know, are you spending
everything that you're making?

How much are you saving
outside of the 401k?

And it's also really common
for clients that I work with to say,

well, you know, I'm getting
17%, 16.

17% from my employer, so I
don't really need to put anything

away.

And I'm like, like, okay, so
why is that?

Why do you think that?

And something that I like to.

To recommend to the clients
that I work with is every single

year, at least, if you're not
maxing out your 401k to increase

your contribution by at least
1% every year, because it creates

good, healthy saving habits.

And you kind of don't miss
what you never had, so you don't

really ever see that 1% hit
your paycheck.

So it's not like it was ever
really missing.

And it just creates, you know,
that good savings habit.

So really, cash flow is super important.

You know, how much are you
contributing as far as, you know

your portion of the 401k, what
your goals are?

Do you have any student loans
that you're still working to pay

off, any car loans?

I currently have a car loan.

It's not very fun, so just
different things like that.

And then it allows me to
create the first step.

And it's like, okay, so we
still have a little bit of debt that

we're working to pay for.

Maybe we have a revolving
credit card balance that has 20 plus

percent as that interest rate.

So maybe we should start
paying that off first.

So that's the first thing that
I like to look at and then like I

mentioned is creating those
savings habits.

Do you have an emergency fund
which is typically three to six months

of your expenses saved in
either a high yield savings or you

know, readily available assets
like a money market account, something

that you can easily pull from
in the event of emergencies.

Something my dad used to tell
me when I was growing up and I hated

it was when it rained, rains,
it pours and it is so true, so true.

I promise as soon as you start
having car issues, that's when the

cat gets sick, that's when the
AC goes out.

It's like everything at once
just starts to hit you and it's like

you feel confident, you feel
comfortable with your finances and

then something happens and
it's a domino effect.

So that's something I really
like to signify importance to is

that emergency fund is because
we don't want to pay off all this

credit card debt.

An emergency happens and then
we're back at square one because

we put everything back on the
credit card.

So those are probably the two
biggest things that I, that I think

about before we start spending
more money and then also continuing

to save in that 401k,
increasing your contribution because

it won't take, it doesn't
usually take a long time before you're

maxing it out on your end too.

Yeah.

And I kind of say to that like
life throws you curveballs.

Right?

Like my family's throwing a
curveball this year as well.

You're kind of pressed into
what's going on.

And I mean one of my first
calls was to Gary reaching out be

like hey Gary.

I mean he helps me with my
financial advisor stuff through Allworth

and just like hey, what do we do?

What do we do here?

Like what can I do here?

What is available?

What's the smartest move that
I can make and how can I maximize?

Kind of like if I need more
cash now versus keeping it.

Do you rec.

You know, just those questions
were very beneficial to have with

someone that knows what
they're talking about because that

goes back to the emotional
side of things.

When you're facing something
that might be challenging in life,

you might emotionally make the
wrong decision and having someone

to talk it through is a really
good idea.

So that was very beneficial as well.

And I really liked what you
said talking about, you know, you

made it right.

Like you're, you're at an
airline, you're doing this.

It's like, well, you have
student loan debt.

Most likely.

Most pilots have a lot of
student loan debt.

They're coming through.

It's like, let's, let's focus
on paying that off.

Let's focus on the 401k.

But also, yeah, you're making
18 from the company benefit.

But it's also a good idea to
put your own money aside because

I think a lot of people think
of major airline retirement.

You know, that's going to be
my only savings.

I'm going to spend everything
else because I made it now, like

that is going to give me a
couple million dollars to retire

on.

And I'm good.

But I love how you mentioned
and recommended that you also do

your own savings as well.

And Jim, you might have seen
that personally too, working at an

airline and wife.

Yeah, it's just.

It's funny how you bring it up.

I mean, I remember my first
cargo job.

I was making $17,000 a year.

You know, my rent was 300
bucks a month.

We didn't have kids yet, thank
God, but we were.

I remember sitting there
thinking myself, there's been some

months where, you know, how am
I going to come up with rent?

You know, I'm notoriously was
really bad with.

With money.

You know, my wife's a little
bit better, but we did have to learn.

But now it's.

It's funny because the more
money you make, you know, I have

a very good salary here at und.

I also have businesses outside
of und.

My wife, a senior FO now at
United, you know, we're making more

money than we've ever made in
our lives.

But to Elise's point, you
know, you really have to be careful

because, you know, we just
came back from a cruise overseas

and I'm sitting there, these
bills coming in, and I mean, these

are just absurd bills that I would.

First part of our marriage I
would have never considered.

And I remember thinking to
myself as he's come in, you know,

that could have been in.

You know, I could have been in
my rock.

That could have been in my,
you know, all these other things.

So.

So it's just interesting.

The more money you make, it
does not solve your problems.

There's no doubt about it.

And I can also just say from
an emotional point of view too, it

doesn't necessarily mean
you're happiest either.

You get more money, you have
more money problems sometimes.

So, yeah, good Stuff.

Yeah, I mean, lifestyle creep
is a very real thing.

It's very easy to happen.

It happens very fast.

You don't even realize it's happening.

And before you know it you're
like, oh wow, I had extra money,

but now I don't have any extra money.

At least he's not going to
like our next conversation.

Right, right.

Jim, I want to talk about kind
of like the second phase now.

So you're at a regional, your
first, first kind of major airline

or even the flow through
programs right now that are going

on.

Have you seen any trends?

I know they've kind of slowed down.

I've known.

No, now most people aren't
looking at like the two, three years.

It could be more five years.

But historically that's still good.

Right?

The trends of flow throughs, I
mean we've seen, I've talked to captains

are like, it took me 11 years
to flow.

It's like just knowing that
that happens now.

The flow programs are probably
relatively new.

He probably got a flow maybe
like five years in his career.

So maybe it was more of a
seven year flow or like a six year

flow.

But still a long flow can be typical.

And it has happened in the past.

Absolutely.

The original flow through
program from American Eagle to American

is one of those big examples.

But now a lot of them have it.

I will say this, it looks like
we're going to hire we like I'm United

or Delta or American, it looks
like the industry is going to hire

somewhere north to 4,000 pilots.

I suspect that most of those
pilots are in some type of a flow

program, whether it's, or
whatever you want to call it.

United's AV8, Delta's Propel,
you know, all the different carriers

have different, different
plans like that and I think most

of them are coming from, from
those particular avenues.

So the flow is very real.

But if you look at this
historically and you know, Elise

could always run the numbers
for you, I'm sure, but let's just

say there's a two year delay
from what you originally thought

you were going to do to get on
at American.

And you know, what, what the
two years is going to take.

Now as a first officer, it's
not like you're not getting, I'm

sorry, as a captain, it's not
like you're not getting paid at your

regional airline, you know,
and so it would be interesting to

run that.

But I think that hiring is
still healthy.

I think that the flows are
still there and it seems to be the

primary method now.

It looks Like Boeing's going
for certification of their max Sevens

and tens and they may get that
by the end of the year.

The 787 production is ramping
back up.

Airbus and the Rolls Royce
engines seem to be solving their

issues.

So you know, depending on what
happens in the economy, we are seeing

some, we are seeing some
softening in the markets compared

to what we've seen in the past.

So there's that.

But all things considered, it
looks like we will still be hiring

well north of 4,000 pilots at
these major airlines for the foreseeable

future.

And maybe we'll even get back
to where we before.

Because you have to remember
some of these massive retirements

have not yet even hit their
main point.

Like, you know, United still a
couple years away from where they're

going to have the apex of
their retirement flush.

I think American.

Justin.

I don't know, I'd have to go
and look, but they're a pretty senior

group, let me just put it that way.

And I think that there's a
pretty good chunk of pilots that

are going to be coming up
retirement there.

I do think we might have
crested a little bit on Deltas, but

I don't know, I'd have to go
back and look, look.

But the point is, is we still
haven't seen the massive retirements

that often kind of push the hiring.

And you know, with Boeing and
Airbus coming back online, I think

the future is still very bright.

You know, it's good to have
these flow throughs, it's good to

do those things.

But I would still not let the
sunset on getting those resumes out

there, you know, retailing
yourself as a pilot just like the

good old days, going to the
conferences, you know, working your

networks, all the things that
have been proven in the past.

I would still continue to do that.

Yeah.

And Jim, you know, you're a
check airman at a regional airline.

Not bringing up the same guy
again, but just the job that he has.

You're making a lot of money, right?

These major airlines have
invested in making sure their check

airmen are getting paid very well.

So they don't lose them as
often because they're very much needed

right now to change to train
all these new pilots that are coming

in.

Do you think that's it's
capable for those airlines or do

you think they will always now
kind of that they set the standard,

have that pay or do you see
that kind of being as a temporary

thing?

Well, we are starting to see
some of the hiring bonuses go away

because of what you Talked
about the beginning where some of

these regional CEOs are
saying, we no longer have this issue

or whatever, which isn't quite
true, but it's certainly not where

it was a couple years ago.

But let's talk a little bit
about the line check Airmen because

that's a very, very specific,
specific bubble.

That's a.

So it's a hard training
program to get through because you

have to schedule at the faa,
you have to go through all this.

So to get somebody to that
spot is very expensive for a company.

So my guess is, and by the
way, once you become a line check

airmen, you're almost
instantly hirable at any major airline.

So when you told me about your
friend, that did pique my interest

a little bit because you don't
hear too often about line check Airmen,

you know, not making it.

But, but certainly I have, and
they certainly have gone on to do

great things, you know, elsewhere.

But that being said, that's
typically the thing.

So to answer your question
very specifically, I see regional

airlines continuing to greatly
protect their Czech Airmen resource

because they're so hard to
hatch, they're so hard to train.

And you know, when one leaves,
it causes probably a 6x churn and

training, and you still have
to go through the approval process

to let the FAA sign off on.

You know, they don't, they
don't like a lot of Czech Airmen,

typically speaking, leaking
because of quality control issues

and whatnot.

So it's a big process.

It probably takes from
inception to somebody fully fed qualified

as a line check Airmen.

Nowadays, I'm guessing six months.

Maybe some airlines can do
that quicker, but, you know, so,

so when one of them leaves, my
goodness, it's going to be six months

before that, that hole's filled.

Yeah.

Yeah.

But I guess the better
question is, do you think that because,

you know, some people are
like, hey, I'm making 400 grand at

envoys because I'm a check airman.

Yeah, I'm set for life.

Do you think that's a good way
to think of that?

Well, so, great question.

Right.

And I get this question a lot.

I'm sure you do too.

And I really am anxious to
hear what Elise has to say about

this as well.

I will say, generally
speaking, at a younger age, at a

younger age, it almost always
makes sense to make the jump to your

legacy carrier just in terms
of retirement, just because I've

so.

So I also sometimes serve as
an expert witness.

I think I've told you that
this before, Justin, and I never

represent the airlines.

I Don't know if that's good or bad.

I always represent the pilots
that have been harmed and that can't

afford to pay their, pay their
expert witnesses, but that's okay.

But I have done a lot of
career earning calculations as part

of damage calculations for pilots.

And we're talking, you know,
if a 25 year old, for instance, stays

at a, at a regional airline,
even if they're a Czech airman, you

know, and they're making that
400,000, and if that continues, I'm

still telling you, and it'd be
interesting, maybe, maybe I don't

want to put a lease on the
spot, but, but my guess is it's still

a several million dollar
difference in terms of overall compensation

package if they choose not to
go to a legacy carrier in terms of

overall compensation, you
know, by the end of their career.

But that being said, I would
almost always encourage people to

leave their regional airlines,
if they can, until they get to a

certain age.

And then the other, the other
piece to that is, you know, everyone's

situation is very specific.

Like I happen to know a
captain has a special needs son and

that person has the perfect
schedule, you know, for, for their

son at their regional.

And so it works great.

They make enough money, things
are fine, they get the schedule they

want, that person's never
going to go to a, to a legacy carrier.

But generally speaking, I
would say financially, all things

considered, it would be better
to make that jump.

I don't mean to put you on the
spot, Elise, but I mean, I'm sure

you run those.

What do you think?

Yeah, no, I think that's a
good point.

You know, like a lot of the
regionals have matches, you know,

like whether it's 6%, 9%
total, it's not the 16, 17, 18% that

you're seeing with the legacy
airlines, which is absolutely insane

and very well deserved, you know.

And then also with the legacy
airlines, they're very generous as

far as benefits goes for
health, offering high deductible

health plans, which allows you
to open what's called a health savings

account that has triple tax advantages.

You know, you, you, it's tax
deductible what you contribute.

The earnings grow tax free,
and if you use those dollars for

medical expenses, they are tax free.

So, and then, you know, as far
as working for a bigger company,

it's pretty common that they
are able to, you know, pay more of

the medical benefits on their
end or take more of the employer

costs.

So you're paying very little
rather than working for you Know

smaller airlines or regionals
where you may have to pay more out

of pockets pocket for, for
medical benefit.

So that's a good point.

I would absolutely recommend
the same thing as both of you have

said, if you can, it's better
to leave when you're younger, as

soon as you can at an earlier
age just so you can continue to build

that wealth at a legacy
airline where you do have the potential

to, to earn more and also, you
know, benefit yourself with, you

know, their, their employer benefits.

Yeah, one, one thing I'll
bring up Justin, that just, you know,

I used to also be a contract
negotiator for American Eagle and

we didn't start seeing some of
9% matches on 401ks at the regionals

until, you know, post 911 when
it looked like people weren't ever

going to get out of the
regional because most regional airlines

had a philosophy that people
weren't going to retire there.

So why, why would the union,
why would the company spend money

on funding these expensive
retirement programs?

But we have seen some movement
there and there are people now that

absolutely want to retire at
the regional.

So it is, it is good that
we've got some of that 7, 8, 9% match

that, that a bit little Elise
is talking about, but it still is

a dwarfs in comparison.

You know, my wife has a health
savings account as well and I didn't

understand that triple
advantage until we started seeing

that come in.

And you know, my goodness,
there's just a lot of things like

that that are available when
you have all this, all these programs.

So, so yeah, if you can make
the jump, make the jump.

Not everyone can and it's
understandable if you can't.

Yeah.

And one thing I didn't know
about when Gary and I kind of first

started all this is the, the
advantage of having all worth or,

or your services and
understanding the benefits that you

have.

Right.

Like open enrol up.

And Gary's like, hey, do you
want me to have my American guy talk

to you about everything that
we they offer so you can make the

best decision possible.

I was like, please, because I
don't understand any of this.

I, I can do a podcast, I can
fly an airplane, but I can't read

these documents and be like,
oh that's makes sense.

That's the best for me.

It's, you know, I'm just kind
of like plan A, cool.

Plan B, sweet.

All right.

You know that, that's kind of
how I view it.

I'm like, that's what my buddy
told me to do.

So I'm just going to do it.

But being able to talk to the
professional at your airline, specifically

if it's American or Delta or
United, because there's always a

little bit of differences what
they offer, but having that ability

to kind of sit down with
someone and actually have those conversations

is super beneficial.

And at least I'm sure you've
recommended people to talk to those.

Those advisors as well, so
that they can make the best decision

possible.

Yeah, we always call our busy
season October, November, during

our open enrollment period.

And regardless if you are a
client or not, we talk to anybody

who is interested as far as
their benefit goes.

The unfortunate thing is your
benefits window is about two weeks

long to make an election.

And of course, you're busy,
you're flying, you have a family.

The last thing that you want
to do on your day off is read about

benefits when it's already
pretty complicated and hard to understand.

And that's why, like you said,
Justin is reaching out, talking to

us.

It's like, hey, you know, my
buddy's doing this.

But that doesn't necessarily
mean that that's the best plan for

you.

Like, we were talking about
that hsa, that health savings account.

It is really great if you're
healthy, relatively healthy, you

never go to the doctor.

But I know some people who are
like, hey, I'm expecting to get a

hand surgery, and I may have
to be.

You know, I don't want to have
to pay that much out of pocket.

Like, how do I.

How does this benefit me?

So we're happy to walk you
through pros, cons based on your

personal.

Your personal situation,
because it's different for everyone.

And that's something that's
one of my favorite seasons of the

year, just because we get to
meet new people, and it allows to

me, us to.

To bring comfort and peace of
mind to the people that we work with.

And, Elise, when you are
talking to someone, whether it's

a new client or something
you've had for a while, you know

they're getting the itch, right.

To make that first big purchase.

And is it a conversation?

You're like, all right, you're
making a lot more money now.

You've kind of paid off some stuff.

It's okay to kind of buy
something big that you want, whether

you can afford it.

Right.

I'm sure there's a limit, but
kind of, what's your thought process

if someone's like, you're
talking to them like, I think I want

to get a car or I want to Buy
this house or I want to buy a new

watch.

Like, what's your thought process?

When.

And say I come up to you, and
I'm like, hey, I really want to finally

make my big airline pilot
purchase or my big captain purchase.

What.

What kind of the talking
points you have with your clients?

Yeah, Everything in moderation.

Right.

I'm not gonna lie.

I like going to Taco Bell and
eating bad food sometimes.

So everything in moderation.

So I am a firm believer of you
don't have to save everything that

you make.

I am a younger investor, so I
believe in finding a nice balance

of savings and then also
treating yourself.

You know, life is not guaranteed.

If we knew everyone's date of
death, we would have the perfect

financial plan for you.

But unfortunately, that's just
not how life works.

So whenever I have a client
who, for example, I have someone

I'm working with, and they're
still working and they really want

to buy an rv, I think it'd be
really cool just to, you know, drive

wherever we want, wherever we
want and be able to park and enjoy

that with our family.

And it's like, yeah, like,
everything in moderation.

Of course.

Course.

We'll take a look at cash flow
just to make sure that we're able

to afford it.

How much are you having to borrow?

But I am absolutely.

I'm usually giving the green
light to, yes, let's go ahead and

make that big purchase.

We're comfortable.

We're saving.

We have that emergency fund.

Let's move forward with that
purchase, because most of the times,

you can't afford it.

And if we can't, then we
figure out a way to.

Maybe it's not in our timeline
now, but give us two years and we'll

be there.

Yeah.

And find a specific way to
save for it or have a bucket for

what you want to buy.

Yeah, absolutely.

And then we're gonna ask Elise
a question.

Can.

Can you tell my wife it's okay
for me to get an iPhone 16?

I'm not up yet on my plan.

Hey, phone's not coming out
till September, so you have.

Okay.

All right.

I might work.

Let me check my phone.

I just got a Zelle from Jim,
so, yes, it's okay.

I love it.

And at least when we're kind
of talking about, like, you know,

the second part of your
career, you know, the last part was

kind of regional flow, first
year major, and now we're kind of

talking about you're in the
thick of it, maybe you have kids

now you're thinking of college savings.

You're thinking of 529 plans.

You're thinking of ways to
really kind of set up your family.

Gary or not Gary.

Sorry, Jim.

I've said Gary so many times today.

I'm so used to it.

He'll probably love that.

I'm just talking about him.

Phantom.

Oh, his, his ears are burning
right now.

I know.

He's probably calling me like,
yes, you did it.

But Jim, I mean you're, you
have a family.

You, your 529 plans are very
probably prominent in your conversations

with your wife and saving.

But what's the thought process?

You know, there's always the
idea of like lifestyle creep.

We talked about four.

You want the captain house,
you want the boat, you want the fun

toys.

But there's also important
things to think about, like college

plans, like buying your kids
their first car.

So kind of talk about at least
your game plan for someone that's

in the second stage of their
kind of career with families, young

kids and moving up and making
sure they're set up, set up for retirement

life and current life.

Absolutely.

And I'm also a big believer
in, you know, everyone's situation

is different.

I have some clients who are
like, hey, I had to pay for college

all throughout my.

Or had to pay for college by myself.

So my kids, I want them to
have that same lesson.

I have other clients who are
like, hey, my 529s are set up, but

my children don't know that
they have college savings because

they want them to have skin in
the game and they don't want to,

you know, feel like they just.

College is being paid for.

Let's, so let's take it as a
joke, but really I like to put my

focus, of course on my clients.

Are we saving enough for retirement?

That should be priority number one.

Okay, so now we're maxing on
our 401ks.

We have a healthy savings account.

What do we do next?

I very commonly run 529
scenarios for my clients to see how

much should we be funding for college?

I typically recommend, you
know, around two to three years because

I'm sure your children are
going to be very bright.

They may have scholarships,
whether it's, you know, for grades

or for sports.

So we don't want to overfund
your college savings account and

then be penalized for using
those dollars for non educational

expenses.

So we kind of.

Or I like to walk through.

Okay, let's aim for this amount.

Of course, like your financial plan.

We do update that college
analysis on a year basis just based

on returns.

And, you know, maybe the
grandparents gave a generous gift

one year.

So that definitely helps out
with the cost.

And something else I really
like to think about mid career is

do you want to work until 65?

I feel like a lot of
conversations that I've been having

as of recent have been no, I
don't see myself flying until 65.

I'm thinking maybe 55, 60 is
more in my range because I have,

I started having children
later in life, so they're still growing

up, they're still young, and I
want to be present for those moments.

So I do feel like it's been
very common for me to not run plans

that have my clients retiring
at 65.

And let's do 55.

What does that look like?

And if we are a little bit
short of our financial goals, how

do we get there?

You know, we're maxing out
that 401k.

What else should I be
investing in?

I'm sure you've heard of
taxable accounts sometimes, sometimes

known as like individual
accounts, joint accounts, brokerage

accounts.

But that allows us an
opportunity to do more things from

a tax perspective.

I don't.

This might be getting into the
weeds, but it's called tax loss harvesting.

So it allows us to be more
intentional with what we're buying

and selling in your accounts.

Because unfortunately, and
fortunately, 401ks and IRAs, they

are already tax deferred.

So from an investment
perspective, there's not a bunch

that we can do in there.

But for taxable accounts, we
are able to mitigate that tax bill

a little bit, which I know
that we try to mitigate that tax

bill depending on if you have
losses and offsetting those with

gains, which pilots do like
that because you're typically a high

income earner.

So that's something that we
think about too, is diversifying

our assets.

Outside of the 401k 529s, how
much are we looking to save?

Are your children inclined to
go to college?

Okay, well, what happens if
they don't?

Do we have another beneficiary
for those accounts?

And then also going back to
you, this is your financial picture.

Do you want to retire at 65?

Do you want to retire earlier?

How does that impact you and
your quality of life?

And we'll set a plan to make
sure that we are able to accomplish

your goals so that those are reached.

Yeah.

And Elise and Jim, you can
kind of talk to this next question

too, because your wife sounds
like she could make this decision

as well as A senior Fox.

So you're probably having
conversations now about like, all

right, do I want to upgrade?

Like, what is it going to
benefit me to upgrade?

Obviously, there's a ton of
money, but as Jim is probably going

to chime in and be like, well,
senior fo life.

You know, you can make pretty
good money, and you can also not

work very much.

So it's.

It's a very, very great side
of the industry.

If you want to be a senior fo,
pick your trips, fly to get the long

overnights in Rome if you're
on the wide body, or the islands

if you're on a narrow body.

But, Elise, what's kind of your.

Your focus on a conversation?

Say I come up to you, you
know, I'm currently 35.

I'm.

I might be able to upgrade in
the next two years.

What do you recommend?

What do you think I should do?

Or what kind of.

What kind of questions do you
have for them when they come to you

with those with that option of upgrading?

Yeah.

So it's typically the first
thing is family.

I do have one of my pilots
that I work with, and he was one

of my first clients.

He is in his mid-40s, and he
made some unfortunate financial decisions

in the beginning of his career.

So he has a lot of debt, and
family is very important to him.

But he's like, you know what?

I have to take this upgrade in
order to continue to pay my bills,

because I feel like I am still
spending everything that I'm making

towards this one credit card
because you pay it off, and then

that interest just continues.

Like you.

Every time you make a payment,
it's like you're not even touching

the principal.

Right.

And that can be very discouraging.

So that's what I typically
like to.

To talk about is, okay.

Based on your financial
situation, I think that taking this

upgrade will benefit you from
a financial perspective.

Because.

Because we're a little behind,
and that's very vulnerable.

And it can be very emotional
as well, feeling like you are behind.

And everyone's financial
picture is different.

And I always tell my clients
and prospective clients if anyone

is judging you or making you
feel bad based on the decisions that

you're.

That you made or that you're
trying to improve on.

I wouldn't want to work with
someone who makes me feel belittled

or judged.

So there is never any judgment
in these conversations that I have

with my clients.

It's just honesty.

Because sometimes we do need a
little reminder, and I.

A little hit on the hand, like
hey, okay, so we maybe didn't make

the best decisions back then,
so let's fix it now so that we're

not in this hole for the rest
of our lives.

So that's a big question that
I do have for clients and it's very

rare, but I do have some that
kind of feel forced to take the upgrade

and then most of the time they
don't feel forced and they have the

option to, you know, do I take
it, do I not going back to the conversation

of a family, you know, how the
flexibility that you have now, the

schedule that you have now.

I have something, some pilots
who are like, you know, I really

like where I'm at and I don't
really, I don't really feel the need

to upgrade.

Like I'm, I'm financially
okay, I'm financially secure and

that's okay too.

It's just having that
conversation with someone that's

unbiased, that won't judge
you, which is me to see what fits

you and your lifestyle best.

Just because someone else is
doing it and other people, their

goals are to upgrade as soon
as possible, doesn't mean that that's

going to be the best scenario
for you.

Yeah, absolutely.

And Gary, Gary, Gosh, I did
again, Jim, you know you mentioned

your, your wife is, is a
junior fo.

So you probably have had these conversations.

I mean any junior fo that's
been at an airline.

Not a junior fo, senior fo.

Any senior fo has been an
airline for a while or calls himself

a senior foe, can definitely
upgrade at this time.

And we've seen two year
upgrades, we've seen 18 month upgrades

at most of these airlines.

So the conversation has had to
come up like, hey, should we do this?

Are we going after more money?

Do we need the more money or
do we really want to prioritize our

schedule and our time as a family.

Yeah, those are the exact
conversations we have.

In my wife's case, she's also
now just about able to hold a captain

slot and not be on reserve.

So that was kind of the
bedrock, the floor of what she wanted

to do to upgrade.

So yeah, I think she also
wants to make sure she has one more

Christmas off.

So I think we're going to
probably aim for, you know, sometime

in January, February for her upgrade.

But yeah, it'll be a, it'll be
a change because right now she completely

controls her schedule through
prep bidding.

I mean, she gets whatever day
she wants off and she gets to fly

the trip she wants to fly and
it's it's very, very nice.

It's also a dangerous game, right?

Like, I mean it's one of those
things in your mind.

You got to understand that
upgrades will not always be there.

Right?

Right.

UFOs in the past, my previous
company that I worked for, when I

first got hired there, they
had 17 year first officers that were

waiting to become captains.

Right.

So you don't know if the
opportunity is always going to be

there.

You might find yourself stuck
as a senior FO forever or vice versa.

That you might find yourself,
if you take the first upgrade possible,

you might find yourself as a
junior captain for a while.

So there's no guarantee that
the movement will come.

There's no guarantee that you
will be able to get the upgrade.

But it's kind of one of those
things you're like, man, do I take

this right now that like, I
mean, I don't know if I'm going to

be able to like say I want two
more years as an fo to live the good

life of not flying very much
and making good money.

Maybe that won't be afforded
to you in two years.

You don't know that.

So you really gotta, it's kind
of like playing a game, flipping

a coin, really, if it's going
to be there or not.

Yeah, that's absolutely correct.

You absolutely are right.

It's very difficult to plan
like that.

You can kind of have some
goals, some milestones, but you won't

know until you, the time
actually comes if you're going to

be able to execute or not.

That.

Yeah.

And Elise, when, when you get
new clients, right?

I mean the, the range of age
has to be just insane, right?

You're picking up people that
are 23 that are getting hired at

airlines for the first time,
whether it's a regional or some of

them get lucky and they're
getting hired on in a major really

young.

But what are your kind of for
different lifestyles for say for

me coming in at 35 or someone
coming in at 55.

When I in my hiring class we
had a guy that was 55 that got hired

for the airlines for the first time?

Time.

Your conversations have to be
very different with both of us.

What are your conversations
like for someone that is my age getting

hired versus someone that's 55
that has 10 years or 60, that's,

that's 60 that only has five
years left.

What are your conversations
look like between both those age

groups?

Yeah, no, that's a great question.

So like we, you know, have
talked about in the beginning of

our conversation with a lot of
our younger FOs who are getting hired

onto the airlines at a young
age, you have that time horizon.

Horizon.

You have that earning potential.

So they're typically pretty
aggressive as far as their investment

goes, and they're still
figuring out maybe contributing 3

to 5% of their earnings to
their 401k.

But whenever you're 55 and you
get hired an airline, you don't have

that same time horizon.

Right.

You have about 10 years left
of working years at this point.

And it's like, oh, gosh, you
know, these are different conversations

that we're having, and some of
them feel like they have to make

up for that time that they
lost, you know, and they're like,

well, I.

Should I be aggressive in my
portfolio because I only have 10

years.

But it's like, well, we want
to be cautious because we don't want

you to lose out on all your
investment earnings too.

Right.

So the big conversation, you
know, regardless, young or old, is

we want to mitigate risk
across the board, whether that's

investments, estate planning,
making sure that you're in, your

loved ones are taken care of,
insurance planning to make sure that

your family's taking care of
in the event of you're not working,

disability.

So a lot of the conversations
are the same as far as mitigating

that risk.

But, you know, something that
we talk about whenever you're 55

is, okay, so we're going to
work until we're 65.

How should that portfolio be
allocated to make sure that you're,

you know, still having those
investment earnings while also mitigating

that risk and protecting you
from the downside?

And then also talking about,
you know, Social Security and Medicare

because you're 10 years away
from that, you're not 30 years away

from that.

So that can be very
intimidating, too.

Right.

It's like, okay, I just got
started at this incredible legacy

airline, and now I have all
these decisions to make, and it can

be very overwhelming.

So I would say that that's
like the big difference as far as,

you know, the topics of
conversation is whenever you're older

or more senior, as far as age
goes, you have have those Medicare

and Social Security and just
different events to think about because

you're closer to retirement.

And we unfortunately don't
have that same gift of time as we

did whenever we were 24.

Absolutely.

And at least when do you have
the conversations about some of the

stuff that's maybe not as
exciting because you never want to

use it, but it's always good
to have it like disability insurance

or some unions offer really
good benefits that maybe the airline

might not offer.

So you want to look into those.

Those benefits as well.

But when do you kind of bring
that up?

Is that something right away?

You're like, buy in, buy in,
buy in as early as possible.

Because I know at my airline
you have to pay for the union side.

You have to buy it within the
first five years.

So you never have the
opportunity to buy it.

And it turns out it's pretty
good, pretty good option.

A lot of the pilots I would
like, you have to have it.

And apparently it can pay some
serious money when.

When you're putting a lot of
money into it.

Yeah.

So we do run insurance
analysis and I think that goes back

to the financial plan of.

Okay, well, what assets do you have?

What liabilities do you have?

Because we want to make sure
that your.

You're not overinsured and
then also not underinsured.

Right.

Because we still want to be
able to pay off those liabilities

and thankfully at all worth.

You know, I know investments
are really important.

I want you to do well in your
investment account because I like

my job and I want to keep it.

And I also want you to do well
in your accounts.

But it's not just about investments.

Right.

It's about mitigating risk.

And insurance is part of that.

You know, your career, a lot
of things that you can't control,

maybe that's a medical issue
or a disability that maybe our medical

license gets taken away.

Right.

And that can be absolutely devastating.

But we want to be able to be
prepared in those events and here

at all worth.

We actually do have an
insurance team as well who is able.

We don't sell insurance, we
don't sell products, nothing like

that.

But in the event you did need
additional insurance outside of your

employer, we.

We are able to run different
quotes for you just to make sure

that you're not paying
anything like any crazy premiums,

but also that you're buying
from a company that's stable and

that has a good reputation.

And that's very important for.

For us as well.

Yeah, absolutely.

I mean, my wife is a doctor
and you mentioned the disability

insurance of doctors are kind
of the insurance that you need as

a doctor separate from the
airline world.

But it's still important for
you to have it as well, because there

is no guarantee you're going
to make it to age 65.

I think the data even shows
that you're most likely.

A lot of people retire earlier
in 65, whether you're forced to or

whether, as we talked about
earlier, you just don't want to fly

to 65.

Because let's be honest, I
would love to not fly to 65.

I would love to have enough
money in my retirement accounts to

be able to do whatever I want
at 55, at 60 and not have to go fly

a four day trip.

You know, eventually you're
going to want to live your life and

it's better to do it earlier
when you're younger and you can still

walk pretty well when you get
older and you're having surgeries

or having any health ailments,
which I think everyone can agree

to that.

So yeah, it's important to
look at.

All those and then also the
peace of mind that it provides too.

Right.

I know there's different
premiums involved with insurance,

but I have clients who are
like, hey Elise, like I would rather

pay the extra thirty dollar
month premium or whatever that dollar

amount is to have that peace
of mind knowing that if something

were to happen, I'm okay.

And I don't think there'
there's anything wrong with that

either.

So.

Yeah.

And another big thing is life
insurance too, making sure you have

that.

So you set up whether you have
kids and make sure your family that

gets used to living the
certain lifestyle because there's

a lot of families out there
that where the pilot is the only

job.

Right.

Like, not everyone has dual income.

You know, you make it as a
major airline pilot, if you're making

300 to $500,000, it's a good
chance that that's going to be the

sole owner, ownership and sole
earner, I should say, of, of the

family.

So having the life insurance,
which I'm guessing you can communicate

with back and forth with Elise
or your team, figuring out what the

right price is and what the
right amount is for you and what

you want to, what you would
want to leave for your family.

Just there.

Sorry, I think I had a pause.

Oh, we gotcha.

Okay, cool.

And then, you know, Jim,
Elise, when you're getting into later

in your career, right.

There's, there's different
opportunities for saving.

So we talked about kind of, of
55, but even you get 60 your last

five years, there's emergency
catch up, there's a lot of other

opportunities that you're
allowed to.

I think you can do emergency
catch up up to I think maybe 50,

I'm not sure.

At least you can correct me
with that because I'm sure, you know,

but there's different
opportunities, you have to save,

right?

Yes.

At age 50, you are offered
what's called a catch up contribution,

which allows you to contribute
more to your 401k.

Right now it's 7500 each year.

It does change a bit, little,
little bit for inflation.

And there's also something new
called the super catch up.

And I know people are like,
what is that?

But the super catch up
contribution, and this might be going

to a little bit into the
weeds, but it's actually an $11,250

contribution that you can make
for and for employees who are aged

60 to 63.

So that's kind of new.

And that's just a reminder
that the IRS is always changing the

roles, changing the laws, and
it's hard to keep up with that.

And it is our job as a
fiduciary, which means that we put

our clients interests ahead of
our own, is to make sure that we're

kept up with the most recent laws.

So that way we're able to
create a financial plan that's compliant

with what the IRS is saying
now and not years, five year outdated

numbers.

Numbers.

Yeah.

And Jim, you know, there's a
lot of uncertainty in our career,

right.

Like, you know, 30 years ago
or a long, long time ago, people

would never imagine that TWA
would be out of business, would be

merged into American Airlines.

They would never imagine some
of these very prominent airlines

that own ruled the skies, that
would not be here anymore.

And then you find yourself at
the bottom of the seniority list

or, you know, there's other
things that happen.

September 11th happens,
financial crisis, wars happen.

There's a lot of uncertainty
in this career and what you think

might happen doesn't actually happen.

So I know Elise and Jim, you
can kind of touch on keeping a cool

head and just understanding
that you got to write it out.

You know, we've really harped
on this whole webinar about trying

to take the emotions out of it
and try to really rely on a professional

because it's so good to have a
sounding board.

And I'm guessing both you
would agree with that.

Yeah, I would definitely agree
with that.

I will say, when you look at
this career, especially someone that's

coming up on age 65, that,
yeah, they've been through quite

a bit.

You know, through
consolidation, through, you know,

pandemics, you know,
depression or not depressions, recessions,

you know, all kinds of things.

They've seen a lot.

And you know, you brought up
TWA, but of course it's also America

west and USAir, which I know,
you're very familiar with Justin,

but there's also a lot of other.

Other things that have happened.

And you know, I look back to
my own father who retired at UPS

and the 747, but he, he worked
through Continental and then got.

Went on strike in the early
80s and never got back to the airlines

until up went to UPS.

But he would have been, he was
very junior at Northwest at the time.

And had he chosen to stay at
Northwest, he would have retired

a very senior 747, 400 captain there.

So it just goes to show you
choices that you may.

And I tell students this all
the time.

You just have to take the best
information that you have at the

current time.

Time and do the best you can
with it.

You can never know perfectly
how things are going to turn out

in this career field.

I will say the stability is a
lot better today than it was even

10, 15 years ago and 30 years
ago and, and so forth.

But it's still one of those
careers that people have to be adaptable

and flexible and take a bigger
look at things.

And the ideas behind having
the emergency funds available that

Elise talked about earlier,
these are very important things for

people pilots to make sure
they can withstand some of these,

some of these issues that they
might face in their career.

Yeah.

And I think that's what makes,
you know, financial planning so important

too, is that this isn't a
document that we create once.

And you're like, all right, Jim.

All right, Justin.

We have the perfect plan.

We don't.

We are required at least once
a year to review our financial plan

with you, just to make sure
that we update according to new laws,

that the IRS is making, any
new tax codes, estate codes.

But it's also responsibility
for myself as an advisor to reach

out to my clients if there are
any concerns, and then also my clients

and my prospective clients to
let me know and to be transparent

as possible when it comes to
their finances, because I would rather

adjust something sooner rather
than later.

So I think that's, that's
really important.

And as my clients are closer
to approaching retirement, I like

to meet with them on a
quarterly basis, at least just because

I know that's kind of the
time, time period where we need a

little bit more hand holding
to know that it's okay because some

people are like, I'm ready to retire.

You know, this is the best day ever.

And some people have a little
bit of a harder time when they aren't

going to be getting a paycheck.

Like they have been Getting
for the past 40 years of their life.

It's a big change, and
everyone has a different reaction

towards it.

And retirement looks different
for Everybody.

Your goals 10 years ago are
different than they are now.

They're going to be different
ten years from now.

Our perspective changes.

The industry is always changing.

And that's.

That's part of my job, is to
make sure that we're having those

ongoing conversations to make
sure that you're not only financially

set up successfully, but your
family's taken care of and that you

have that peace of mind to
know that, you know, we're mitigating

risk across the board.

Yeah, absolutely.

And what Jim was talking
about, too, about making those decisions

and what's at least talking about.

You don't know if you make the
right decision until age 65 comes

or age 67, if that ever comes
to fruition.

And you look back on your
career, you're like, oh, well, maybe

I should not have left less.

My left, my fractional to go
here, or, man, I should have gone

earlier, or I should have done this.

You know, you don't know if
the decision is the right decision

until it's time to hang it up,
until it's time to retire.

So, as Jim said, make the
decision with the most information

that you have available and
make sure you keep your financial

advisor in the loop, because
they can be like, hey, that's dumb.

Don't do that.

But it's important to just
make the decision, trust yourself,

and just know that you're not
going to really know if it was the

right decision until the end,
because there's a lot of people like

to talk about that, that
thought they're at TWA and thought

they'd be at TBA forever, and
turns out now they're flying for

a different airline.

And maybe they didn't enjoy
the seniority that they had, which

I'm not laughing.

It's the truth to it.

Yeah.

But talking about kind of the
last step of this, you know, you

mentioned the last five years
of a quarterly meetings.

You mentioned all that.

There's Medicare, there's
Social Security, there's other health

care things.

You've had health care for so
long, and now you're gonna have to

figure out another way to have
health care.

You're gonna be paying a bit,
little bit more.

There's going to be so much
going on, but at least you're in

your fast couple years.

You know, age 65, age 67.

What do you recommend for
someone that's out there?

Because we talked about what
it's like to kind of reach your end.

And we also never really
touched on that.

A lot of these people, they
are so caught up in being a pilot,

they don't know how to live
without being a pilot.

Right.

Like, they got to reinvent themselves.

But what do you recommend for
people that are getting ready to

retire in that case?

Yeah, I would first, you know,
try to create a picture of what does

retirement look like to you?

I have some clients who are
like, hey, I still want to be involved

in the aviation world somehow
at some capacity.

I have some who are like, hey,
I enjoy living in Florida and golfing

every single morning, and
there is no right, no wrong.

It's basically what you want.

Right.

So I always.

And sometimes people are like,
I don't know.

And that's an answer, too.

Right.

So we're able to sit down,
talk about what's important to you.

And also involving the spouse
as well.

Whether, you know, it's a
female pilot, a male pilot, involving

the spouse.

Spouse.

Like, what do they want together?

You know, sometimes we want to
do a big trip, a big.

Or maybe we want to travel
once a year.

We want to spend $15,000 a
year on it, whatever that looks like.

I enjoy having those
conversations with my clients and

their spouse to make sure that
they're both involved and included

in those.

And then also, as far as, you
know, age, you know, we're approaching

65 or close to retirement.

Well, when should I take
Social Security?

Am I going to need that?

I have some clients who are
like, Elise, Social Security is not

going to be around when.

When I start to withdraw.

Okay.

If you believe that we can
plan for that.

It's very common for me to plan.

You know, you're only going to
receive 50% of the benefits that

you actually are, just so it
provides that additional comfort,

that additional being
conservative in the plan as well.

So we don't rely on it too
much, but just different conversations

that involve, you know,
healthcare, what you.

You know, what you envision
retirement to look like, and if there's,

you know, do you want to
continue to work?

Some of my clients work part
time, and they.

Or they volunteer.

And then also something that's
very important is what legacy do

you want to leave?

You know, do you want to help
out your grandchildren with college

education?

How do you want your, you
know, your.

Your family to benefit
whenever you pass?

I have some clients who say,
elise, I want to die with $1 to my

name.

Name.

And I have others who are very
giving, and Gary and I did say Gary.

So he always says in his
meetings, you can either give with

a cold hand or a warm hand.

So something I encourage my
clients to do is if they are able

to give while you're still
alive, you know, you want to be able

to put that joy on your, your
family's face and helping them buy

a house or whatever that looks
like, or funding your grandchildren's

education so that way they can
see the gifts and also thank you

for it too.

I think the legacy planning is
something that's very near and dear

to my heart because that's
what you're leaving behind and this

is your family.

So those are the big topics of
conversation that I, that I like

to have.

Yeah.

And Jim, we'll kind of leave
it to you.

The question that's on a lot
of people's mind, especially when

I fly with people that are 64,
65, they're like, you know, I think

I could do this till 67.

Like, who's to tell me that if
I can still get a medical, I can't

fly?

In our previous care, I was,
is that this was a big deal because

you could fly.

We had 80 year old pilots.

You could fly as long as you wanted.

And that's a pretty sweet deal
when you're making the top of the

seniority list and you have
seniority, not fly very often.

So it's, it's very real right now.

It's very real out there.

Are they going to get two more years?

Have you heard anything on
this is kind of been put on the back

burner or what's kind of going
on with the age 67 rule?

Well, it's certainly being
talked about, it's talked about annually

in Congress.

It would take a congressional change.

You know, what happened the
first time we went from 60 to 65,

this is my opinion.

But one of the big reasons for
that was because the Social Security

age changed, you know.

Well, it didn't change, but
you couldn't collect until you're

65 and you had this mandatory
retirement at 60.

And then when the pensions
went away, when, you know, when the

guaranteed stuff went away,
there literally was a five year gap

where some pilots who had been
making 2, $300,000 a year went to

zero income and couldn't get
their Social Security security for

five years.

So I believe that's when the
labor unions change their, their

policy because they very much
opposed an age 65.

Remember, as a contract
negotiator, we negotiate the size

of the pie first.

We do the macro negotiation
this is how much is available and

then we divide up the pieces.

So when you do it to 60, the
pie is bigger for everybody else

until you get to 60.

The philosophy from a union is
you can make all the, you make the

same amount of money and you
can be done at 60 that then you could

make a little bit less money
each year, still get the same amount

of money when you're 65.

But that all changed in my
opinion when Social Security changed.

Well, now we also have the
Social Security change again because

you know, most people in my
age group won't, shouldn't really

collect till they're 67 or
maybe even a little older.

So now you got that two year gap.

So you are seeing some of
those, some of those things line

up again.

The union still is steadfastly
alpha, at least is still steadfastly

and the membership is still
steadfastly against any further raises.

But it does come up every year
and there's a fair, a fair number

of congressional support.

But like you said, Justin,
that just applies to 121.

And there are plenty of seats
out there in the 135 world, part

91 world that people can still
and still do.

You know, there's also a whole
world of flight training.

You can go work at one of the,
one of the, you know, you know, semi

flights or something like that.

You know, wealth of experience there.

So it does.

Just because you hit 65 and
can't fly for your 121 anymore doesn't

mean your ability to, to stay
in aviation goes away completely.

Yeah, but let's not kid ourselves.

There's a lot of 121 pilots
that kind of forget what it was like

to fly at 135Amen or 91k.

Coming from that world and now
being in the, the 121 world, I'm

like, oh my gosh.

I flew my first three leg day
at American in a whole year and that

was, it was like, oh my God,
this is way too much work.

But my last job at a minimum,
we threw three legs every single

day, three to five legs.

And I'm so far I'm a year
removed from that.

In the morning you're like, oh
my gosh, I don't want to do.

It's awful.

So yeah, it's all relative and
you kind of forget how, how good

you have it.

You know, turning left is, is
amazing and shutting the door and

just flying the airplane and
then going and just being done.

It's great.

And, but it is something to
think about.

And I'm sure Elise can.

Can also come in or someone
from all worth can.

Can come in and be like, all
right, you know what, you did start

a little bit later.

If you can find something to
do for another two years or, hey,

you know, this fraction, we'll
get you till 70.

Why don't we try to apply there?

And you can make good money,
you know, so at least you can probably

say that these conversations
happen and you can really tell someone,

like, hey, no, trust me, you
are fine.

Retire, enjoy your career or
enjoy your life.

Absolutely, Absolutely.

And it's always one of my
favorite parts about being a financial

advisor is walking a client
through retirement and them knowing

that it's okay.

And it's.

It's really common.

And the best thing ever is
I've recently been working with,

of course, mainly pilots, and
then their sons and their daughters

are also pilots.

And working with the whole
family has just been a really unique

perspective for me.

And it's just, you know,
aviation is a.

Is a career I'm also very
passionate about.

And just being able to have
the opportunity to meet clients where

they're at.

Whether it's the very
beginning of your career or, you

know, we're close to that
retirement or we're right in the

middle.

I love meeting my clients
where they're at.

Everyone's situation is
different, and it's not cookie cutter.

Just because one person is
doing something doesn't mean that

you need to do it.

And that's the best part about
working with an advisor and especially

at all Worth is having those
conversations that are unique to

you, just like your industry
and your journey in your industry

as well.

A hundred percent agree.

And that pretty much wraps up
the main portion of the webinar.

Elise, Jim, I appreciate your insights.

You know, it's great to have
the financial insight and it's great

to have the insight that Jim
has as well.

Well, of just the wealth of
knowledge and what's going on in

this industry.

It's really helpful for anyone.

So I appreciate both of you
right now coming on and giving your

time.

Thanks for having me.

Yeah, it was fun and I look
forward to, you know, if you have

any questions, you can always
reach out to me.

There is a.

There's a button link on your
screen or in the chat.

You can request a consultation.

My favorite part is, you know,
creating a financial plan, a personalized

plan based on your airline,
your timeline and your priorities.

And I would love the
opportunity to.

To have that conversation with
you and.

Like you said, if you are
looking for guidance and you want

some more information, there's
a complimentary phone in, not interview

but a phone consultation that
you can have and someone from All

Worth will talk to you.

They will figure out what they
can offer for you and if you like

it, continue and have that
conversation and have someone like

Elise offer their expertise to
give you the opportunity to have

the career and have the
lifestyle style that you want to

have.

So thank you so much for
listening today.

I really appreciate all your time.

Don't forget that there is a
question and answer which we're going

to head down to now.

So if you haven't asked a
question, still ask your question

now.

We'll read them and we'll be
able to answer those questions for

you right now.

So let's head over to the
question and answer.

Thank you so much for spending
the last, what hour and 20 minutes

with us.

There's a lot of information.

I'm sure Jim and Elise are
just excited to answer some more

questions that we have had
come up through this webinar.

The first one that we had, I
wrote some of them down so I'm looking

down on them right now.

Is this was a personal
question from my friend Dan.

Actually shout out to Dan,
thanks for watching this and asking

this question but it says more
just looking at your thoughts.

I'm retired military.

I make 81000 a year.

Just waking or just waking up.

Thoughts on having a 401k,
other investments etc since the annuity

is basically worth 2 million
in investments.

And Jim, I'll probably let at
least answer this one unless you

have some kind of financial
degree that I'm not aware of.

No, I think that's smart.

You can definitely chime in if
you like.

Well first off Dan, I want to
say thank you for your service here

at All Worth.

We are heavily involved in our
tag, the Rotarita Airline Group.

So there are a lot of, you
know, clients that we work with that

were in the military currently
serving, are done with it and who

are working, you know, outside
of that.

So thank you so much for your service.

Just wanted to, to make sure I
mention that and I think this is

a great question.

You know, your pension is
going to be worth a lot of money

and that's, that's really great.

So there's just a couple of
things that I would definitely ask

as far as the 401k thoughts on
not having a 401k.

Well, first question, are you
offered a 401k currently?

If so, I would definitely at
least contribute up to the match

that your employer gives you
you because that is free money.

We don't want to leave any
money on the table that your employer

is offering you.

So absolutely, I do believe
that you should still contribute

to a 401k.

And as far as, you know,
outside of investments besides the

401k, you know, with your
pension, you are relying on that

dollar amount to keep up with inflation.

It may not always receive
cola, that cost of living adjustment.

So if that's the case, you
know, the $81,000 that you're making

now isn't going to be the same
value as tomorrow.

And you know, Outside of the
401k, you are able to contribute

to a Roth IRA since you are
under the income limits.

So you do pay taxes on those
dollars today.

But the growth in earnings is
tax free whenever you retire.

And as long as that account
has been open for five years.

So there's definitely
opportunities to diversify your investments

because your pension, you
don't really get a lot of options

as far as where to diversify
those assets.

But with IRAs and 401ks, you
do have more flexibility as far as

growth potential.

And I think that's really important.

And just going back to what I
stated about legacy planning.

Do you have children?

Where do you want or what do
you want your legacy to be?

Are you wanting to, you know,
and have your children or nephews,

nieces, whatever, whoever they
are, inherit those assets.

So by paying taxes like for
the Roth IRAs on those dollars, now

they can inherit those
accounts tax free, which is a great

benefit for them.

So, you know, it really
depends on a lot of different factors

like how important is family
and beneficiaries because typically

pensions die with you or with
your spouse and you know, you having

to rely on the government to
apply that cost of living adjustment,

that can be, you know,
sometimes risky depending on, depending

on the circumstances.

So I hope this answered your
question, but this would be a great

opportunity for us to sit
down, have a conversation, take a

glance at what your financial
picture looks like today and we can

make improvements on it and
show you what it looks like if you

do contribute to a 401k or
outside investment accounts.

Love it.

This is another question we
have here.

It says the airlines have
hired so many new pilots the last

couple of years.

What do you see hiring look
like over the next five years?

And Jim, I'll pass that one on
to you.

Sure, great question.

It's a question that we get
quite regularly.

The truth is the hiring is
certainly not, as we mentioned before,

certainly not what it's been
in 23 and 24 where we saw saw an

unbelievable exponential
growth of pilot hiring.

Nonetheless, it's still on tap
for north of 4,000 at the major airlines.

And you can check this all out
at the FAPA website, which is still

historically a very good year
for hiring.

On an average year going all
the way back to 2000, we had some

lean years and the Great
recession and some mid 2000s and

post 9 11, but we average
about 3400 pilots a year.

So having 4000, we're still
north of what a normal year would

be.

So.

So we're still good.

The other thing to take a look
at is the number of retirements.

Some airlines, some of the
major airlines have not gone into

their big retirement push yet.

Those are still a few years off.

And that's another in addition
to the growth, that's another reason

why we see pilots get hired is
to replace those that are retiring.

And so overall prospects are
still good.

Certainly it's gotten a little
more competitive in the last couple

years from what we saw saw in
23 and in 24, but it's still not

historically where as bad as
it could be from a pilot perspective.

So the future's still bright,
no doubt.

Yeah.

And one thing to note too, I
think is take those retirements and

check and see which airline
has the most favorable retirements

for you if you're looking to
get hired.

Because if you're younger, you
might want to go to the airline where

you're going to get above 50%
seniority rather than the other one

or you might be sitting 50%
much later in your career.

So it might just be another
metric to take in to into a consideration

when you're looking to see
what airline you want to go to because

as we all know, seniority
matters for vacation, for bidding,

for everything, for bases.

So it might be kind of a good
idea to check out who is going to

be retiring more pilots
because some airlines have hired

more and are more set up to
not hire as many in the future.

Yeah, sage wisdom there and
there, there certainly are certainly

are some airlines out there.

American Airlines comes to mind.

They have a very, I like to
say seasoned pilot group.

So there's a lot of, a lot of pilots.

I don't know what the average
age is there, but I'm sure it's close

to 50, if not higher maybe in
that neighborhood.

And then the other thing to
keep in mind is historically speaking,

and it's Gone up a little bit.

Only about three out of five
pilots go all the way to the retirement

age.

Sometimes it's a little higher
than that.

There's some airlines that hit
75%, some that don't hit that, but

it's about 60, 65%.

And there's a lot of reasons
for that.

Of course, loss of medical is one.

But also there's pilots that
choose to retire a little bit early.

I'm sure lease has clients
like that.

So.

So not every, you know, we're,
we're assuming everyone makes it

to 65.

So that's another variable.

But what Justin's saying is a
perfect thing to take into account

for your long term career planning.

That is definitely a variable
I would look at.

Another good question, is this
one's for Elise?

Probably a lot of people have
this question.

You know, you get hired by a
legacy, you get hired by a major,

and you see 16%, 17%, whatever.

I don't know what all the new
contracts are saying for direct contribution,

but is that enough for someone
to do?

Like, do you recommend if
someone's coming up to you, like,

all right, should I max this
out or should I maybe not put as

much in because the company's
going to match and then should I

have some other investments as well?

So I guess what's the
importance of kind of your actual

company funded 401k versus
doing outside investments?

Yeah, that's a great question.

Especially with the younger
pilots that I work with when they're

like, you know, I'm not really
going to contribute to my 401k because,

because my employer is giving
me 16, 17%.

And that's incredibly generous.

But like I mentioned during
the webinar, setting those healthy

habits of at least
contributing 1%.

And whenever I have clients,
which it usually doesn't take very

long, once they reach that
seniority, they max it out.

And the importance of, you
know, out investing outside of the

401k is a lot of the pilots
that I work with that are at 65,

they are retired.

All they have is their 401k
and it's a significant amount of

money in the 401k, but that's it.

So when it comes to
diversifying your investments, you

know, on those 401k dollars, a
lot of it is traditional, which means

that you pay taxes at retirement.

And then I'm sure you've heard
of RMDs.

Those are required minimum
distributions at age 73.

So from a tax perspective, it
really is a good idea to diversify

your investments outside of
the 401k.

So that way whenever you are
age 65, whenever you start pulling

out from your 401k and your
investment accounts, you have the

control from a tax perspective
to be able to choose where you are

withdrawing those funds.

So you don't feel like you're
forced to have to pay the taxes on

those traditional 401k dollars.

Because you have, you have
Roth money too.

You have individual accounts,
which, those are taxable accounts.

So you have more flexibility
as far as that goes.

So I always encourage,
especially my younger pilots to diversify

your investments.

Go ahead and contribute to
Roth if you can, if you're in a lower

tax bracket and also look at
individual accounts too.

So that way, you know, if you
have medium, shorter term goals or

medium goals, you can take
them out of the taxable account.

Absolutely.

That's great advice.

I always talk to some of my
friends and I, they mentioned, yeah,

like what's the compensation
for a pilot?

You kind of explain to it and
it gets really confusing, right?

You have your hourly rate,
Well, I fly this much, I get paid

that, but I could
theoretically not fly at all and

don't make any money.

So they're really confused on that.

But then when I get to my
retirement and I kind of tell me,

yeah, well, they do 16% or 17%
direct contribution and they think

it's taking that out of my salary.

But when I tell them no, it's
like an addition to my salary, they're

kind of just dumbfounded.

They're like, what?

But my question for your lease
is, would you say that, that airlines

and airline pilots have some
of the best retirement programs set

up out of most jobs that
you've seen.

Oh, absolutely.

And it's always funny when I
work with a couple and one of the

spouse is a pilot and the
other one works at, you know, as

an engineer at, you know, some
firm or some company and they're,

they're getting a 6% match or
a 7% match and then the pilot is

getting 16 to 17%.

So it's a, an essential amount
of money that you are receiving automatically

regardless if you contribute
or not in your 401k.

So these benefits are incredible.

They're unheard of.

I've had some clients who I've
spoken with and like, yeah, like

no one understands or they
think I'm making this up.

And I'm like, no, this is legit.

So it's really, it's worth it
though because the amount of hours

that you have put in to get to
this point in your career.

It's definitely well deserved.

Deserved, absolutely.

I would agree, Jim, the big
news or not big news, but everyone

has questions about age 67.

I'm not going to ask you if
it's going to happen or not because

I don't think you have a
crystal ball or Magic 8 ball.

I don't think you can look and
see if it's going to come to fruition.

But how would you say someone that.

The specific question was, I'm
a 25 year old new hire at a legacy

airline, what should I think
about age 67?

Is it going to hinder my
career like you think that's an extra

two years that I have to
seniority, stagnation.

Should you look on the other
side like, yeah, well, you and the

end of your career will have
an extra two years of big pay.

But how would you, what would
you say to someone that's in that

situation if it does come true?

How should they look at it as
a 25 year old pilot?

Yeah, this, this question came
up quite a bit when we went from

60 to 65, as you pointed out.

And there's a lot of pilots in
the industry that, that blame that

change on stagnation for them.

And I think that that
certainly was a contributor.

There are other contributors
as well.

Well, not the least of which
was just the general economy and

passenger traffic.

That being said, in this
particular case, there probably would

be some type of an effect to
go from 65 to 67, but I would argue

it would be a lot less one
because it's just two years instead

of five years.

It's two year Delta instead of
a five year Delta.

And then also on top of that,
there's going to be less and less

people that make it medically
from 65 to 67 or even voluntarily

make it from 65 to 67.

So certainly it could have a
little bit of an effect.

But to answer your original
question, if I'm 25, I'm not really

worried about that too much.

I've got 40 years at least
ahead of me, maybe 42.

I will tell you from a
earnings point of view, those last

few years of earnings, when
you're a widebody captain or you're

at the apex of the carrier,
you want more of those years available

to you.

I will tell you it's complex
from a union point of view.

I used to be a union
negotiator, as you know, and we used

to, we used to negotiate pay,
pay rates.

It is difficult because
sometimes when you Raise the retirement

age.

One theory is, is the overall
amount of money that the company

can pay stays the same and
you're just spreading the workload

out, you know, over more
years, more work years for the pilot.

I'm not convinced of that, but
that is definitely the conventional

wisdom.

And so it is possible you
could see some adjustments in collective

bargaining in the future that
would capture that reality.

So.

But who knows if 65 is going
to change?

The 67, it is talked about
quite a bit.

There's a pretty vocal group
of pilots out there that want it

changed.

So far, the Alpa referendum
and other airline pilots unions have.

The union membership is not in
favor of it.

So right now I think that's
enough to probably keep it from happening.

Yeah, for now, like we said, I
mean, whether you want it to happen

or not to happen, just one of
those things we got wait and see

and just kind of, it's one of
the things you have to accept that

this career is just a wild ride.

You don't know where it's
going to end.

You don't know how, how it's
going to be.

Or you can look back on your decisions.

When you are finally 65 or 67,
you retire like, yeah, I made all

the right choices.

Or you're like, dang it, I
should not have done that.

Elise, this is the last
question we have.

But it's, it's more on the
financial side of that same question.

Right.

So 65 to 67, if you can
continue to make the top end widebody

captain pay, I'm sure you as a
financial advisor, like, please,

please, please, two more years.

I would.

The things we could do with
your money for two more years at

$500,000 a year is probably
pretty great.

Yeah.

And like Jim mentioned, of
course those two additional years

you have more compounding interest.

You have your, you know,
you're a captain widebody and you're

at your peak of your income
earnings, which is incredible.

So two years can really, you
know, that's a significant impact

on your financial plan.

And something else that I
would, would remind you of is the

IRS is always changing rules,
regulations, different things that

are going on.

Like for example, I talked
about those required minimum distributions.

It used to be age 70 and a half.

It used to be age 73 or 72.

73.

And then by the time that we
retire it's going to be 75.

So there are all sorts of
different ages that are changing.

People are living longer,
people are working longer.

So that's part of, or a good
Thing about working with an advisor

is it's our responsibility as
fiduciaries to make sure that we

are up to date with those IRS
changes and roles.

So that way we reflect your
financial plan to be in good order

with those, those changes.

So, yes, it can be a
significant impact and a lot of strategies

that we can utilize just to
make sure that you're all, you're

all set in your retirement,
even though at age 67, it'll be a

little bit less of a, a time
horizon for those retirement years.

What Jim and Elise, those are
all the questions we have.

It's.

It was a great webinar.

It's awesome to talk with Jim always.

Right.

We have the State of the
Industry podcast that we do to have

these conversations and just
talk about what's going on in the

industry, because as we've
noticed, there's a lot going on at

all times.

It doesn't matter if it's Covid.

It doesn't matter if it's
someone trying to buy another airline.

There's always a news story
for us to talk about, no matter what,

what could be going on.

And at least it's always great
to have the, the kind of the expertise

that Jim and I don't have when
it comes to finances.

You probably look at ours
like, oh, wow, I could really help

you guys.

But we appreciate you coming
on and sharing this information and

talking with us.

I'm sure there's a lot of good
value that everyone got out of this.

And if you do have more
questions for Elise, there is a phone

number down below.

There's a form.

You can get in contact with
Allworth and you get in contact with

Elise and they can answer any
question you have, I'm sure.

And I said any questions from,
like, don't say that, but they can

answer.

They can help you out.

So go ahead and contact them
because I can tell you personally,

it's been great for me.

Just peace of mind, you know,
historically, pilots aren't the best

for their money, so why not
have someone help you out?

But go ahead and fill out that
information and give them a call

if you have any extra questions.

Other than that.

Elise, Jim, thank you so much.

Thank you so much for coming on.

I appreciate your time.

Thanks so much.

AV Nation.

That is a wrap on episode 335.

Thank you so much for
listening to today's episode.

I appreciate you all taking
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But AV Nation, I hope you're
having a great day, and as always,

happy flying.