How Does It Feel to Pay Off a Truck?

[ATeam]

Some owner-operators move from one new truck to the next, never paying them off and always making payments. Others pay cash for their trucks. Still others borrow money to buy their trucks, pay them off and continue to run the paid for trucks for a time. This is a question for the latter group.

Making your final truck payment is a milestone event (one Diane and I have yet to experience). I am wondering, how does it feel to make your final truck payment? How does it feel to run a paid-for truck?

Is it any different than running a truck when you are making payments? Does it change your thinking about the kind of loads you will accept or how long you will stay out? Does your thinking change about when you will buy your next truck or what kind of truck it will be? What do you do with the money you were previously using for truck payments?

 

[Jefferson3000]

It always feels REAL good to pay off a truck. It's nice not having to make decisions about working just based upon making your payment in time. It's nice to plan a vacation that doesn't involve a layover in the truck. Just a plane ticket and a hotel reservation or a cruise ticket.

I would still put away a payment amount every month in order to have a nice down payment when you do need a truck. How much is up to you.

Drive Safe!

Jeff

Driver for 15 years
O/O for 13 years
OOIDA #829119

[em]"Let us be thankful for the fools. But for them the rest of us could not succeed." --Mark Twain[/em]

 

[TeamCaffee]

In reality I feel as if this is a foolish question.

Yes we have paid off our truck but the business decisions stay the same. The former payment goes into the bank to gain interest towards the next truck. We plan to run this truck till it becomes a liability and is getting to the point of being unsound. As in most situations you buy what you can afford so our next truck will be a class 8 but will not have the super sleeper as that is not in the budget. We have many plans for our next truck but they are all based on our making money and still being comfortable not luxuries as we are not to that point yet.

Phil what are your future plans for when you pay off your truck? How will the change your business decisions?

 

[JohnO]

Buying used has more benefits in my business plan. I have maybe 5 to 10 years before I retire for the second and final time. Having a new truck payment for a solo o/o just doesn’t compute. With proper planning I was able to pay off my used truck within the first 6 months. Now I’m able to place considerably more into another retirement fund.

 

[LDB]

Through very fortunate circumstances from prior decisions I didn't have a truck note however I just paid off my house. I suspect when I get home next time to a paid for house it will feel different walking through the door. Then again, when I open the door the 4 walls may fall down around me since it just got paid off. :+

Leo Bricker, 73's K5LDB
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[ATeam]

>Phil what are your future plans for when you pay off your
>truck? How will the change your business decisions?

I can't say for sure until we get the truck paid off, which we expect to do no later than June, 2008 (18-24 months after we bought the truck).

I asked the question about how it feels because I the feelings that now drive us will disappear when the final payment is made. We HATE, absolutely HATE, debt. Paying off the truck is very much on our minds. We think about it every day. We think about it with every other purchase decision we make. We ask, should we buy this or put it toward the truck? It keeps us running and running hard.

When the final payment is made, the emotional motivation to eliminate debt will be gone. I asked others how it feels to pay off a truck because I wonder what drives other people to continue when you are not required by debt to do so.

Before we bought the truck, we planned to run it ten years. That will remain unchanged. It's a great truck and virtually nothing in it would change if we had the chance to build it again. We also planed to pay cash for our next truck. That too will remain unchanged. A financially secure retirement is a long term goal, which will also remain unchanged.

What I am not sure about is how hard we will want to run after the truck is paid off. That's why I asked others how they felt and what they did. Do the vacations get longer? Does home time get stretched out? Do tourist attractions get taken in more often? Does one get more involved in indsutry affairs? In other words, how much do you let down from previous production levels when the truck payments cease?

 

[TeamCaffee]

Phil,

Since you don't plan on getting out of expediting you will have to continue to make a truck payment to yourself. The no debt is what motivates us to keep making those truck payments to ourselves so we can pay cash for the next one. We have found that if we stay involved with industry affairs this just keeps us on top of our game plan.

On a personal level not a business level we had a small celebration the day we paid our truck off. We continue on about our business the same way we did with our truck payment. We still have a personal life and we enjoy everything we can while on the road. We feel you have to balance out your personal life with your business life so as not to get burned out.

So nothing changed with us when we paid off our truck it was just business as usual.

So once again how will you change your lifestyle when you pay off your truck?

 

[nightcreacher]

How does it feel ro pay off your truck,well not to brag but I've paid off 5 trucks while in the Expedite business,and have never went over month before getting into another payment.It feels naked to drive without a truck payment,just guess its a way of life.This truck i have now though,will be my last truck,just going to rebuild it and turn it over to someone else so i can sit home and play on EO,of coures not planning that for couple more years

 

[davekc]

Buy what you have cash for, and you will never have to wonder what it is like.
"Cash is King".











Davekc
owner
23 years
PantherII
EO moderator

 

[Jefferson3000]

>
>What I am not sure about is how hard we will want to run
>after the truck is paid off. That's why I asked others how
>they felt and what they did. Do the vacations get longer?
>Does home time get stretched out? Do tourist attractions get
>taken in more often? Does one get more involved in indsutry
>affairs? In other words, how much do you let down from
>previous production levels when the truck payments cease?

===================================

Phil,

I understand you not wanting to have debt over your head. I also believe that home time, as well as a planned vacation, are of great benefit to one's sanity, as well as a chance to enjoy the fruit of one's labor. I believe it is very important to anyone's longevity in their field to to not just pay bills, but to pay oneself something that might be termed as "mad money." You can spend it on a weekly, monthly, or yearly basis. It could go toward weekend getaways, or a long vacation.

I love what I do. But there are days when I absolutely hate the freight business. A little "mad money" can certainly help one to "smell the roses" while accomplishing ultimate goals. We all have goals for our businesses. In order to achieve these goals, we set certain disciplines in place. Burnout occurs when we forget why we do the disciplines that take us from A to B. Just hope you don't let the burden of paying your truck off early, cause you to burn out unnecessarily.



Drive Safe!

Jeff

Driver for 15 years
O/O for 13 years
OOIDA #829119

[em]"Let us be thankful for the fools. But for them the rest of us could not succeed." --Mark Twain[/em]

 

[ATeam]

>So once again how will you change your lifestyle when you
>pay off your truck?

In a major way, probably not at all. In minor ways, perhaps some. By that I mean, we may not be as driven to get back in the game after taking two days off to rest up. We might wait three or four days. Whether the truck is paid for or not, we have no plans to buy a house or vacation property or anything like that. We certainly don't want to complicate our lives by adding trucks and becoming fleet owners. As has been the case since we got into expediting and finding we like it, we plan to live on the road and haul expedited freight as long as our health allows.

What we will have to wait and see about is the intensity with which we pursue our money goals beyond paying off the truck. Four four years, we have been leaning into it pretty hard. While enjoying numerous tourist attractions and completing a number of satisfying family visits, we have taken breaks only when the freight allows (except Christmas), and gone home only when the freight takes us close (except Christmas). I don't know how we'll feel taking something like a two week vacation away from the truck. We might like it and take four weeks, or we might dislike it and go back to taking no weeks.

Again, that's why I asked my question. I am curious about what expediters in paid-for trucks do with their time and money when they are not driven by truck payments.

I do know that if we had the four years to do over again, we would do pretty much the same thing. Expediting continues to be the easiest, most lucrative and most fun work we have ever done. Yes, we have not had a proper vacation in four years, but it is not like expediting does not serve up a spectacular mini-vacation every now and then.

Oh yea. I should add that we have never felt pressured to make a truck payment. Every time one has come due, we have made at least two, and sometimes several more. The pressure comes from our aversion to debt. After the truck is paid for, payment money will go into savings and investments. By the time the truck is ten years old and we move into a new one, there will be more than enough to pay cash for it.

Our first truck will be the last truck we ever finance.

 

[Pappy]

It feels ##### GOOD to pay off a truck! And in accordance with your post, You'll be very wise to keep the truck well maintained and drive it till the freakin' wheels fall off! Thats 35 years of experience in the truckin' industry talkin'! A used truck that is in good condition, will make the same amount of money as a new truck will make minus the payments. BANK the money you would use for monthly payments on another truck!
Then when the old truck is somewhat beyond repair< you can then decide to continue, buy another truck, or retire and enjoy a nice vacation!
I'll be more than happy to tell you guys about my personal experiences in relation to your post. Feel free to call my cell phone @ 864-386-1092 between 9am and 5pm
I'm here to help!

Pappy

 

[Paul56]

We pay cash for anything that depreciates, this includes our own truck and the rest of the fleet.

We have mortgages for income properties which do appreciate; however, here the cash flow is such that the properties look after themselves in terms of cash flow. I don't like debt, but I don't feel compelled to pay the mortgages off either.

I believe diversification is key to survival. Everyone better have a good fall back position to land on... other than social assistance. Don't put all your eggs in one basket... or truck!

Emotion has no place in business decisions. Paying cash for a truck is no reason to start "slacking off" in terms of business... one keeps the business moving forward at the same pace.

I do get emotional when I see Nicole smiling and in a playful mood. :+

Aw heck, we are having so much fun that we may never retire.

 

[ATeam]

>Aw heck, we are having so much fun that we may never retire.
>

With that, we agree. While we are focused on setting up a financially secure retirement, retirement is not plan A. It is not even plan B. We love what we are doing, so why quit? Retirement is not something we want to do. It will be something we are forced to do when age catches up with us and we are no longer healthy enough to work on the road.