Amount of truck payment

[Jayman]

Hello,

When I get to make my career change, I will need to buy a used D or DR unit. How much should I pay a month and still be financially sound? I know there are quite a few varibles to consider. I have done some math and figure I can get a new cab/chassis with used sleeper and box for about $1300 a month. Is this too much for a new guy?

Jayman

 

[arkjarhead]

did you figure in having the sleeper and box installed in the payment or are you paying that seperatly?

 

[Jayman]

Thats an estimate for installation and everything.

 

[Broompilot]

Honestly one can probably esitmate doing somewhere around 10K a month in revenue, thus fuel being 25% of that, add in insurance maybee $500 high end, plus all of the other expenses, add on top of that a break down fund and you can see where this is at best a 50% profitable business if your a good OO. Thus do you want to sleep well at night or worry is the real question? I for one on a used truck would put down enough to keep the payment as close to 1K as possible, go over that and your eating pork and beans more often than not.

After everything is paid for thats your dinner ticket, I like to be able to pick my places to eat at not let my wallet decide. This is probably the single biggest mistake new OO make carrying to much debt to operate ones business and personal expenses. Good luck read back there are a few Posts regarding this topic.

 

[jaminjim]

Team or single? But I go with Broom, less, is more. Less payment leaves more comfort. Maybe drive for an owner first, save the money and put it towards a down payment. then you could answer several questions. 1. how much can I afford. 2. what kind of sleeper do I want. And the all important number three is Do I really want to do this job / life style.

 

[arkjarhead]

i'm not an o/o but my grandpa was and i remeber him telling me you have to pay the truck 25%. What he meant by that was put tht much back for a break down/getting another truck when this one wears out fund. He kept his trucks for about 5 years. His last truck was five years old when he died and he had close to 700,000 miles on it. It bought it from Peterbilt, and was built t his specs. This was after about 35 years of being a truely independent owner operater. Meaning his trailer, his tractor, his authority hauling thru a broker. Another thing he told me about 6 months before he died (2002) was "A man needs to have about 20,000 dollars in his bussiness fund after his down payment before he gets in." He reasoning behind that was if you had that much money saved up and your motor blows up right after th warranty runs out you'll be alright. If you get sick and can't work for a couple weeks or longer, you'll be alright. So I'm saving my money, and when I get 30,000 dollars in the bank which I'm getting close to I'm gonna have money for my down payment and my emergency fund. I think that will give me a saftey net I can depend on. Plus I'm still not sure if I want to expedite in a d unit or a tractor trailer when I get my own. Or do I want to lease on with Tri State or maybe somewhere else. I have time to do my research. I read on here one day a guy was asking where he should lease his truck. He had a truck, but no expedite experience and didn't where to sign own. This business is more of a lifestyle than it is a job. That's why on my profile I list expediting as my hobby. Because it's what I do when I'm working and it's what I focus on when i'm not. Trying to make my self just a lil better, sharpen my skillz just a lil bit more before the next trip. And this most defanently a good place to gain and sharpen the skills needed to be a successful expediter regardless of weather you are an o/o or a fleet driver. Thank you expediters online and all you're members for what you have taught me.

 

[Jayman]

Solo. I may try to drive for somebody else first. But, it may be hard to find a good fleet owner who will take a solo driver with no real experience. Even though I am good at driving and dont have home issues since im single and no kids. The reason I wish to stay solo is doing team would make me feel like I was married to somebody and this town aint big enough for both of us! }> lol

 

[Jayman]

True, always a good idea to have a nice lil nest egg saved back. I also enjoy this forum. We have it so much better than people trying to make it 25 yrs ago.

 

[geo]

if you are going to pay that much for a use truck per month that is very high , my c unit was brand new and paid only 1200 a month

 

[rode2rouen]

>"A man needs to have about 20,000 dollars in
>his bussiness fund after his down payment before he gets
>in." He reasoning behind that was if you had that much money
>saved up and your motor blows up .................


Been there, spent that!


Rex

 

[arkjarhead]

Rode2rouen,
You mean to tell me you've spent every dime your truck made plus more than 20 grand. If that's the case you must be deep in debt. If that is the way it is for everyone I guess there is no money in this.

 

[LDB]

I'd suggest you listen to Dave Ramsey on satellite radio or local radio if you get his show where you are. I'd suggest a modified Dave Ramsey plan. I'd really suggest his plan but that would probably take too long because that's paying cash in full. Anyway, I'd say you need to first get $1000 in the bank for a mini emergency fund. Next you need to pay off all credit cards, cars, student loans, etc. until the only payment left is your mortgage if you own a house or your rent. Then you need to build your savings to about 6 months of expenses. That would be mortgage, utilities, groceries, truck payment etc. which is probably about 12-15 grand. Once that's all in a savings account drawing interest you should build up a down payment fund of at least 20% of whatever truck you are going to buy. Once you have the truck you need to build a breakdown fund sufficient for a new engine. That will take care of the worst the Murphy can throw at you and your 6 months expenses fund will take care of your down time while the engine is swapped out. As to truck payment I'd do my calculations of projected revenues and expenses and figure out how much monthly payment I could make off one average week of operations. That keeps my payment at a manageable level even when it's a slow month. Good luck to you.

Leo Bricker, 73's K5LDB, OOIDA 677319
Owner, Panther trucks 5507, 5508, 5509
Highway Watch Participant, Truckerbuddy
EO Forum Moderator
----------
Support the entire Constitution, not just the parts you like.

 

[dieselphreak2K]

The more of this post I read, the more I realize my buisness plan was psychotic. A word of advice, DO NOT start with zero down, $300 cash, and credit card debt.

 

[rode2rouen]

>Rode2rouen,
>You mean to tell me you've spent every dime your truck made
>plus more than 20 grand. If that's the case you must be deep
>in debt. If that is the way it is for everyone I guess there
>is no money in this.

No, what I meant was that I DID have the engine blow up, back in March, and I DID spend nearly $20K to have a ReCon engine installed. The truck was making money before the blow up and has made money since having the engine replaced. My rainy day fund took a large hit but is recovering.

The point I tried to make is that you MUST have a rainy day fund, like your GrandDad said. If I hadn't had the $$$ to cover the engine replacement, I'd be back turning wrenches again. This truckin' biz is NOT something to get into on a shoestring!!!!!!


As to debt, I have a mortgage and my Sears card has a balance of $76 on it that will be paid in full on the 15th. I learned my lesson with credit cards a few years back. I am a cash kinda guy now!!!!


Rex

 

[romoore245]

You could do what we did. Max everything out and morgatage the house, put it all on an old truck that might make it six months. Then you can see what murphy can do.
Truck got totaled 100 miles to the del on our first day. Another driver fell asleep took out both our trucks. On the bright side the payments were only $1000 a month. It took 90 days for the insurance to settle out that was a long 90 days. We got settled and rolling again, but it really makes you think "when someone says whats the worse that can happen." it can! Thats still no reason to not try, just know the risk you face and the loss possible. Good Luck.

 

[ATeam]

>As to debt, I have a mortgage and my Sears card has a
>balance of $76 on it that will be paid in full on the 15th.
>I learned my lesson with credit cards a few years back. I am
>a cash kinda guy now!!!!

If only you could teach what you learned to millions of other Americans. One of our nation's greatest weaknesses is the fact that millions of citizens are only one paycheck away from bankrupcy. They are not working for themselves or their employers. They are working for their creditors.

 

[ATeam]

>The more of this post I read, the more I realize my buisness
>plan was psychotic. A word of advice, DO NOT start with
>zero down, $300 cash, and credit card debt.

It can be worse than that. My dealer told me about a customer of his who has been driving truck for many years. He told the dealer that he couldn't afford new tires so he had to buy a new truck. He was looking for a no-money-down deal. My dealer didn't bite but I'm sure there are plenty of irresponsible dealers out there who would gladly put this guy in a truck, with terms that protect the dealer, and later take the truck away....just as they planned.

 

[dieselphreak2K]

I see way too many people that finance something, knowing that they will default on it later. Maybe that's just because I come from a low income area, but It seems to happen more and more.

 

[nightcreacher]

Not to get smart with you,but if I had to ask what my payment should be,you might want to hook up with an owner,drive their truck,and get some expediting experiance
then your useing someone elses money to learn,not yours
there lots of pit falls you can get into.
Personally I'm not into used equipment,the payment and upkeep will be more than the payment on new,unless your a mechanic too
good luck

nightcreacher
steve gilbert
ooida263839

 

[nightcreacher]

I disagree,why use your money,use your uncle sams money,if you do good you pay taxes if not so good, no taxes, if you loose,its total right off,the more i can put on truck note,the better i like it.
And i dont buy used,that can be your biggest downfall,payment and repairs,equal to much down time,with new you put away for the repairs
I've had 6 new trucks I've paid off,doing expediting,not all at same time,i do trade every three years,right before trucks start breaking down

nightcreacher
steve gilbert
ooida 263839
fed ex cc E6613