What strikes me these days are the amount of news stories and articles featuring people who have gotten themselves into crippling debt from student loans and/or credit card loans to pay for living expenses whilst studying. These people graduate with their desired qualifications, but fear that they'll never be able to pay off the potentially $100,000+ in loans.
Perhaps it is no wonder therefore that Richie and I often get questions asking us how much money is required to get into trucking. It seems as if people would consider trucking as a career option, but the potentially horrific cost of getting into this industry scares the very idea away before it's even had a chance to take hold.
|The Lincoln Monument rest area on I-80 in Laramie, WY. It's the highest elevation on I-80 at 8,640 feet above sea level|
I should just mention that Richie and I are company drivers. We do not own our truck, nor do we lease it. So, this is written from our perspective as company drivers - not from the perspective of an owner or lease operator.
For company drivers, this is by far the largest expense and one that can put people off. But don't let the initial cost scare you away, as I'll explain.
As anyone can guess, having a normal car license won't get you anywhere. You need a Class A Commercial Driver's License (CDL for short) and that requires attending CDL school.
Because we attended during the Thanksgiving and Christmas/New Year holidays, the course took longer than normal. Usually it takes about 4 or 5 weeks of full time attendance from Monday - Friday.
In 2012, we each paid around $3,200 for the school. This covered all of the teaching and final exams, as well as the DOT physical and drug test (with us, a guy came to the school and took care of all of that).
If at all possible, I would recommend doing all you can to save this money and then, if necessary, beg, borrow (but perhaps not steal) from friends and family for the schooling money. Stay away from bank or other official loans. Here's why.
Most companies who hire fresh CDL grads also offer tuition reimbursement. So if you're able to pay out the initial cost, you'll get it back! If the bank paid for your school, the bank will get reimbursed.
The reason I recommend staying away from the bank is because with our own company, if the bank paid for your school, the company will reimburse the bank and that's that. If an individual paid (and can prove it) our company will reimburse each person something crazy like $15,000! It makes no difference what WE paid. This is what they'll pay.
Sound too good to be true? It is...sort of. Here's the caveat - Companies will never ever give you a check for, say, $5,000 and call it a day. Turnover in this industry is so high that any company who did that would probably go bankrupt immediately. Any company that I'm aware of will pay, say, $100 per month until the full sum is paid. If you leave before that, you forfeit any remaining tuition reimbursement as your second company will probably not be reimbursing you.
In our situation, we've been each receiving monthly reimbursements of just over $100 net since we got off the trainer's truck. If and when we reach our 5 year and one month anniversary, we receive a huge lump payment of $7,500 (before taxes) and that will be the end of our reimbursements. Therefore, the grand total of tuition reimbursement by our company will be $15,000 gross for me and $15,000 gross for Richie, even though we only each paid out $3,200 for our schooling.
OK, granted, to get this, we need to stay with our company for at least 5 years and one month. But if we do, we'll have made over a 400% return on our initial schooling investment. However you look at it, a 400% return in 5 years is pretty darn amazing!
My advice is if you are considering trucking, find out all you can about the tuition reimbursement scheme your prospective companies offer. Ask very specific questions to pin the recruiter down and get as clear a picture as you can.
Total cost: For Richie and me, it was $3,200 each back in 2012.
2. DMV Tests, Permit, License, Endorsement Fees
This is not a huge cost but it's still something you'll need to pay for. Before any CDL school will allow you behind the wheel of a training truck, you'll need to have your CDL permit. To get this, you need to take a rather long written test at the DMV. This may cost around or under $100.
Then, when you pass your final tests at school, you'll be grinning ear to ear as you hurry to the DMV to get your actual CDL. You need to pay for that license though. Check with your local DMV for the cost but I don't think it's more than $100.
It's a good idea also to have your hazmat endorsement before starting with a company. With our company, hazmat endorsed drivers earn substantially more right from day 1 on the trainer's truck. While you're still in school, (and as early as possible) go get fingerprinted (ask at your school as to where to go and procedures to follow) and that will cost under $100. In a couple of weeks or so, you will receive a letter stating that you are cleared to obtain your hazmat endorsement. You can do this once you've graduated CDL school, but not before.
Study the hazmat chapter in your CDL manual and when you go (with your silly grin of course) to the DMV to get your actual license, you can take the written hazmat test. I believe this is under $50 and it's a short and pretty easy test.
Therefore, for all of these costs, I reckon it's safe to set aside $400 per person.
3. Living Costs for the First Month or So
Now, this is not a strictly necessary category, but setting aside some money to cover your costs of living during the first couple of weeks or so at your new company (food especially) may really come in handy.
Your company will pay for your transportation to their main headquarters and will pay for your lodgings during orientation. Our company also provided breakfast, lunch and dinner for the first week, but don't assume that all companies will provide you with 3 meals a day. Check it out beforehand.
I'm not going to dwell on this category as strictly speaking, you do not need this money to get into trucking as a company driver.
Total cost: Depends on how much you have to spare but this is not absolutely necessary to get into trucking.
4. Cost of Truck
Nothing! As company drivers, we don't pay anything for our truck. No monthly payments, no cost of upkeep. Everything associated with the truck is covered by the company.
Total cost: $0
Have you seen the price of diesel? It's extortionate! I wonder if it's the number 1 profit-eater of owner operators. As company drivers, we do not pay a penny for fuel. Not only that, but we receive points when we fuel which we can use to buy things in the truck stop. We also get free showers for fueling and we personally get free coffee/soda when we fuel 75 gallons or more in a single time (because of the specific rewards card we have).
Total cost: $0
5. Truck insurance, permits and registration fees
Commercial trucks need all sorts of permits, state permits, fuel permits, you name it and trucks need it. We actually have a book full of insurance, registration and various state and fuel permits for the year. Each piece of paper in that book has cost something. For owner operators, this is a hefty expense. For company drivers like us, this is no expense!
Total cost: $0
Well, I think that about covers it. I would say that overall, if you want to become a company driver, you'd be wise to set aside around $4,000 or so per person. If the cost of schooling has gone up, then of course you'll need to set aside more to compensate.
I'll end by saying that for Richie and me, we made back our initial outlay ridiculously quickly. Within a couple of months, we had made back everything we spent and then some.