Aircraft Owners and Pilots Association Protecting Your Freedom to Fly

Safety Publications/Articles

Professionally Speaking

Will you be able to retire?

Plan now for the future

This column is for young CFIs. I hope older CFIs will read it, however, just so they can tell young CFIs that the column makes sense.

For you young CFIs, I have a startling announcement-someday you will reach retirement age. What's even more startling is that you will still-believe it or not-be interested in life and in what happens to you. That means you will be very interested in the financial terms of your retirement.

For decades, now, Americans have believed that retirement will take care of itself. There's Social Security, my company has a pension plan, and I will get an airline job and retire with a big income.

In the last few years we have seen large companies fall short on pension funds. We have seen airlines leave pilots in the lurch. As this column was written, we have seen Federal Reserve Chairman Alan Greenspan warn that Social Security may not live up to the promises made to millions upon millions of workers for lo these many decades.

Does anyone still believe that retirement is a guaranteed right of all workers? Face it-you are responsible for your own retirement. Don't trust anyone to do it for you.

The good news is that you can plan your own retirement and make it work. You can, that is, if you start young.

If you start now and set aside just a few dollars every month, you can amass enough money to assure a comfortable retirement. If a 25-year-old CFI starts right now and invests just $50 every month and averages a 12 percent annual return on that money, she will have more than a half-million dollars at age 65. That is in addition to any and all other retirement plans for which she might qualify.

The CFI who waits to start at age 55 would have to invest more than $2,500 per month-more than $30,000 per year-to end up with the same amount of money at age 65.

Think of that. As little as $50 per month could solve the entire problem.

There are many programs available now that allow you to invest tax-free dollars and earn tax-free interest on those dollars. Take advantage of any retirement savings plans, such as a 401(k), offered by your employer. If there are none, or if you are self-employed, find a qualified investment advisor-or study up and do it yourself-and set aside those few dollars every month. Then don't spend them. That's all you have to do. But you have to start now.

Is it worth doing? Just ask an older person who didn't.

Ralph Hood, an aviation speaker and writer, has been flying for more than 33 years and has more than 3,000 hours of flight time. He is a multiengine commercial pilot with an instrument rating.

By Ralph Hood

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