Monthly Maintenance Escrow Question

i do only 1 pmservice(250$) each month, with my cat c13 right now 205 k without troubles,only change a belt for the engine(125$) in 205 k,more money go for tires each year 1 or 2 steertires (500 piece)i

 

IMHO you should be looking at all expenses in CPM (Cents Per Mile) not as monthly costs. I figure costs higher and I figure 0.14 CPM for Repair, Maintenance and Tires. That is for truck and trailer.

Look at what lease purchases require you to escrow. Then look at what most owners say their actual costs run. When I did this I found most numbers between 0.06 - 0.11 CPM for tractor only. The new trucks were the lowest.

You may be able to do it for less but when that $3,000 repair bill arrives two monthes after startup it won't be pretty. Based on my 0.14 CPM and 10,000 miles a month that is $1,400 per month.

That would give you $33,600 in two years. While that seems like a lot, if you spend $8,000 for routine maintenance, $8,000 for tires and $12,000 for an in-frame that leaves $5,600 over two years for unexpected breakdowns.

 

Big John has it about right for tractor only estimate. I would go with that and if you didn't need it all, it is money saved.

 

15c per mile to start, When/If you have the account up around $10-15K you can reduce it.

 

Correct, If you are in this for the long haul you have to have that service account built up or one breakdown will have you out of buisness. It is not a savings account for anything else, in your mind consider it spent even if it isn't . . . . . yet.

 

I was reading in another post about the need to save money for future equipment replacement. I'm just wondering if it wouldn't be a good idea instead of stop putting money into the service account continue and use that for future equipment replacement also?

 

The way I approach this is that all revenues go into a bank account under my company name. I then make a monthly salary payment to our personal bank account. All maintenance money, equipment replacement money, etc is all in one place in the company account. It builds up and is untouchable except for business purposes. Salary to myself is fixed. I am not incorporated so that is not in play. But the finances are handled similar to a corporation just to keep things manageable and tidy.

 

The most important thing is to keep your expense down. If you have a hefty mortgage and truck payments. Its going to be hard to put money away for maint. If i had to do it all over again, i would not have any personal bills to pay on. I have a laundry list on maintenance since i started last yr. About 3 weeks a go i had to put a clutch in , it cost me $2600. Truck was down for 4 days...Lucky i had the money saved up for emergencies.