Quote: (05-29-2015 03:51 PM)FlyBoy Wrote:
I heard this argument before but I am not convinced. If one is a CEO of a growing company that has to be in a 100 places now, then yes, his time is valuable. However, that's business usage not personal. On the other hand if one is a 50 y/o semiretired 200 millionaire, then what difference does it make if he arrives in Aspen at 3pm or 5pm. Certainly not enough to justify the enormous cost of having a plane.
I certainly understand the need for privacy that some may have. Still, that need however important can not be a rational driver for jet acquisition. A public figure may have an extreme need for privacy but only flys twice a year. Such people would be better off chartering and or buying a jet card.
Yes, I agree, all status symbols wear off quickly!! I hope I didn't come across as saying that a jet is nothing but a show off piece. Business jets are very valuable tools for the companies that own and use them. Likewise a private jet is a convenient, efficient and indeed enjoyable mode of transportation for its UHNWI. Be that as it may, the latter usage can not be financially justified. That's not saying much of course, after all, we engage in many things that can not be justified; women, kids, caviar, etc .. lol
FlyBoy try to look at it this way. I like your example of 200M and 50 yo semi-retired. In this case assume the that money is mostly liquid with about 25% in closely held companies but 75% available for investing. Also assume that he spends about 1-1.5% each year on expenses. The return on investments after taxes and inflation is still above the amount he spends each year. This 2M-3M he has available each year can be spent in any way he wants without risking the principal and continuing to grow his net worth.
The maintenance on owning a jet would be 25-40% of his yearly money available to spend. At the end of the day if comes down to how to use that money to make a fulfilling life. If the guy in this example likes to scuba dive, snowboard, travel, and visit family and friends then a jet would come in quite handy. Especially if those things were spread out and not close to commercial airports. For example. it's not economically justifiable to donate a good portion of each years money to charity but if this 50 yo wants to he can. It's better than filling a house with whores and being Instagram "famous" like Dan Blitz.
Hotwheels, if you're ever in South Florida send me a PM. I can show you around a bit. You know what's better than owning a jet? Knowing someone that owns a jet.