Flying in a private jet is one thing… How about partially owning a private jet?! Today we dissect owning a private jet with fractional shares. Read more below…
Owning a private jet is not always the most ideal option for everyone. But, owning a private jet with fractional shares is a great way to feel like you own a jet and benefit from it without actually owning it all alone.
There are many different programs available that offer fractional ownership. But is it right for you? Should you take that step financially? Or, would you be better off continuing to charter private jets when you need them?
There are many benefits that come from having shared ownership of a private aircraft. However, it is important that you take all things into consideration before you make the investment. Let’s talk about what it means to partially own a private jet with fractional shares.
Owning a Private Jet with Fractional Shares
When you own a jet with fractional shares, you don’t own the jet by yourself alone. Instead, you own a percentage of it with others – and how much of it you choose to own is up to you based on how much you intend to use the jet.
Fractional shares are often broken down based on hours in-flight. Most operate for a total of 800 hours per calendar year. So, owning a share of this would give you a portion of those hours. In other words, ⅛ ownership gives you access to 100 hours of flight time. And, someone with ¼ shares gets 200 hours of flight time. Keep in mind that each fractional purchase may vary. Some may even go by days rather than hours.
Before making a purchase, it is a good idea to know just how much you intend to use the jet.
Benefits of Owning a Jet with Fractional Shares
Those who have invested in owning a private jet with fractional shares have found that they can take advantage of quite a few benefits. After all, there are many advantages to having fractional ownership rather than full ownership.
Let’s take a look at a few of these benefits, shall we?
1. Easy, flexible access to the aircraft. When you are a partial owner, you often have access when you need it – or at least within a few hours.
2. Your choice of jets. Because you aren’t footing the bill for the entire jet, you have more options available. More expensive jets become more affordable when you are only paying for a fraction of it.
3. Deductions for depreciation. Using your jet for business means you can deduct depreciation which can benefit you financially. This can only be done when you have some or all ownership rights.
Of course, it wouldn’t be right if we didn’t discuss all the benefits that come with fractional ownership, such as the ability to fly private and enjoy all the perks of it. This includes privacy, flexibility, access to smaller airports, convenience, increased safety, and more. Plus, if you are someone who always prefers to fly private, you can save a lot of money when you just own your own jet!
The Costs of Owning a Jet with Fractional Shares
Yes, it is true – you will save money when you opt for owning a jet with fractional shares rather than purchasing a private jet outright. But before making the decision to do this, it is important that you understand the costs associated with it.
When you choose to own a jet with fractional shares, you will be responsible for the following costs:
1. The cost of acquisition. This is the capital fee and it is directly related to how big of a share you are investing in and how expensive the jet is. The smaller your share or smaller the aircraft, the smaller your acquisition cost.
2. Monthly management fees. There are certain costs that come with owning a private jet, such as insurance, pilot training, administrative expenses, and more. These are generally set each month and, as a fractional owner, you are responsible for your share of the costs.
3. Maintenance and the Occupied Hourly Fee. This cost includes fuel, maintenance, catering, in-flight systems, and so on. This is the cost of using the jet so it will vary based on the frequency and how long your trips are.
Is Fractional Jet Ownership Right For You? What are the Alternatives?
Owning a private jet with fractional shares is not always the best option for everyone. For those who don’t intend to use the jet very often, there may be other alternatives that make better financial sense. For instance, if you don’t plan to utilize the jet for at least 50 hours per year, chartering a jet when you need it may be a more viable option.
A few alternatives you may want to consider are:
1. Purchasing a private jet. Flying frequently and wanting the freedom to do so as much or as little as you’d like, whenever you like is what you get when you own your own private jet. Of course, as much as it can be seen as a profitable investment, it can also be quite costly to maintain.
2. Leasing a private jet. For many, purchasing a private jet can put a big dent in the budget. Leasing, on the other hand, is a much easier way to have full access to a jet without having to worry about wear and tear down the road. You rent it for a set period of time and then return it.
3. Private jet charters. Chartering a flight is a great option for someone who doesn’t intend to fly often but wants all the perks of a private jet. This method of travel is becoming more affordable and common for everyday travelers.
4. Jet cards. When you find a charter company you enjoy, see what incentives they have. For those who offer programs, such as a jet card program, you will save money with every flight. And, you won’t be required to complete contracts and paperwork before each flight. This keeps it affordable and convenient.
Choosing to own a private jet with fractional shares may or may not be for you. Whatever you decide, know this – private jet charters are always available just for you.