Maximizing Jet Ownership: Costs to Consider Before Chartering
Any time you make an investment, you want to feel confident you’ll get a good return. Unfortunately, many people who invest in private jets miss out on potential returns by failing to capitalize on opportunities to monetize their assets.
Your jet doesn’t have to be a drain on your resources. By understanding the costs associated with jet ownership and the opportunities you have to offset those costs, you’ll maximize the return on your investment.
The true cost of jet ownership
While you might focus on the cost of the jet itself when you start shopping around for aircraft, the reality is that your initial purchase is just the beginning. Several major expenses associated with private jet ownership and use exist, and it’s important to be familiar with these various costs before you make a purchase.
- Jet purchase — Private jets vary widely in price, but you can expect to pay anywhere from $3 million to $90 million depending on the size, performance, features, and customization options you choose. New versus pre-owned is also a major factor in price.
- Insurance — Insurance fees will cost you between $30,000 and $50,000 annually depending on the aircraft’s age, payload, and average flight hours.
- Maintenance and operation — Jet maintenance and operation can be costly. You need to pay for crew, fuel, oil, landing fees, and maintenance of your jet’s mechanical and technological systems. All told, maintenance and operation for your private jet can range from $700,000 to $4 million annually depending on various factors.
- Storage — When your jet isn’t in use, you’ll have to store it in a hangar. Hangar fees are usually around $80,000 annually but can vary. If you choose to keep your jet stored at a large international airport, you may pay upwards of $160,000 a year.
Excluding the initial purchase of your jet, you will likely pay around $5 million to operate your jet on an annual basis. For many, this annual cost simply isn’t in the budget. However, there are steps you can take to offset this cost and ensure that you’re getting a great return on your investment in a private jet.
Chartering a jet to offset costs
The amount you can earn by chartering your jet depends on a few factors, including the jet’s size, where it’s going, and the trip’s length. For a trip from New York to London, a passenger may pay as much as $85,000 to charter a jet one way. While chartering out your jet when you aren’t using it probably won’t pay for operational expenses completely, it can significantly offset your annual costs.
Jet ownership is as much about logistics as it is about cost, but these two considerations go hand in hand. Before you spring for the private jet you’ve had your eye on, think about the logistics and cost of your purchase. With good planning and forethought, you’ll make the most of your investment.