Success vs Bankruptcy: Lease From Hell Or O/O The Hard (Smart) Way?

I posted the following in another thread concerning a company driver wanting to get in on one of those cheesy lease programs and realized that this advice was probably better stated here:

When once upon a time when my wife and I were a company driving team, happy as pigs in poop with all the miles and money that was going into a single bank account, I was asked if our truck company (Interstate Dist, Tacoma, WA at that time) was "the best"? As happy as we were with Interstate, all I could say was "Interstate wasn't as bad as all the rest..." When it comes to trucking companies and the way the average driver is treated? They ALL suck... Relatively speaking...
The following is not a popular thing to discuss in public as I will no doubt be attacked for 'profiling' the poor truck driver, but with as much 'life experience' that truck drivers have in general, they are also generally (and severely) uneducated in both business practices and finances. That is why Bank and SBA loans to O/O's, though available, are so rare. That is also why Volvo Finance and others can get away with charging the 9% ~ 14%+ on their 'driver friendly' loans. They are the only people that will loan on a truck without YOU showing a strong profit margin. Why? All banks look at all truck loans, ie, Truck Drivers, as 'high risk', because? Truck drivers, again, in general, default too often. So far so good, right?
All lease programs are worded so that you, the less than business savy, potentially self-employed truck driver, do not understand the real terms in the contract, which is plainly seen by anyone in the real business world as something close to 'Indentured Servitude.' My wife and I haul classified military 'stuff', mainly of an explosive nature, and then once in a while some commercial RAM. Yes, we have secret clearances, has-mat, TWIC cards and the works, and yes, we make what most drivers think is only a dream at best, and an outright lie at worse, but even at the amount of money made in our niche of the industry, people loose their trucks every day to poor business practices, ie, not saving all they make in their emergency fund. (Sorry, but no new Harleys, jet boats or $50k 4X4 trucks that we should never have time to drive anyway if we are looking at any kind of retirement plan someday!) Like the saying goes: "If the wheels ain't turnin', you ain't makin' money..."
Point being, do your research and do NOT rate a company by what other drivers say, or feel, about it. A good business model will start with a highly trained CPA knowledgeable in the trucking industry that even semi-approves of your business model, and a lawyer that can draw you up a bullet proof LLC plan. Your CPA and attorney usually know each other. "But, but, BUT I can't afford that!" Exactly. If your pre-planned business model doesn't work, or worse, you don't even HAVE ONE, WHY would you go ahead and sign on the dotted line with any of the companies that offer these so-called good deals that can 'get you into the drivers seat', blah, blah Blah???
I know what I speak. We have been over the road, as a team, for 14 years, The first 5 yrs saving up the big down payment as company drivers to go O/O with an affordable monthly payment on a brand new truck with 3 yr warranty. After the good planning and hard work, we have not only made enough money to purchase back to back 2 new trucks now, but have also purchased and develop and paaid off a 10 acre southern Oregon ranch with a 2 acre pond full of LMB and 20lb Channel Cats, also have a paid for tractor/backhoe with all the attachments, 2 paid for cars and all the r/c planes and motors for my retirement at 60 next month. I even have my own 400' long runway! YES! But it gets better! Our 2009 Volvo 780 is paid for and only has 180,000 miles on it because military loads don't have to go all that far, usually. It is in brand new condition and will be for sale soon and all the $k we get for it doesn't go to the bank! The interest we saved on the early pay-off of the ranch and truck is out of this world too, but that is in another installment if any of you are interested.
In other words, and all I am trying to get across to you all is, there IS money to be made out there in the industry, but not the way most of us try to make it. Landstar is one of the companies that hauls military, but so is R+R and TSMT out of Joplin MO, and Green Valley out of the Stockton CA area I believe. But even with Landstar, you better be a real savy business person with a bulldog ability to beat out others for the reward for hard work, or you'll sink there too. We found R+R the best, but that is because they are very family orientated which worked great for when the grandkids came along and we wanted/needed to be home much more often. True, to haul military you have to be a team, as the loads have to be guarded 24/7, but solo's can run RAM and it too pays way better than general freight!
I will monitor this post and stay available for questions (and criticisms of course) if you need interpretation for anything that I have said. In short, its like this: "Experience is the best teacher, only it doesn't have to be YOUR experience!" I have the heart of a teacher and like to see others do well. 14 years ago, I was one of the MOST UN-disciplined human beings on the face of the earth. I didn't know a profit loss statement from a tire iron... But, looking back now, and though the discipline thing was a steep learning curve for me, it wasn't so bad. The reason I can say that is the rewards that it paid in the end. With a low CSA score, (0-0 is very helpful!), haz-mat certification and the ability to get your gov clearance, YOU, not the companies, get to call the shots. The ONLY reason that truck drivers are still being paid garbage can low wages is because the absolute majority sign on for it in the first place. This is mainly because they feel like they have no options, and sadly, most of the time they don't. But, again, that too is a subject for another installment...
Driving as a team for Interstate taught us a lot, and admittedly made it to the top in the company in a short amount of time simply because we were always on time, never complained, and kept the truck moving to the tune of 24k+ miles every 28 days, with 4 earned days off, and then back on the road. I like to put it this way: We went from trailer trash to trucker trash in less than a year and were doing great! I learned how to cook in the truck, going down the road, and even oftentimes hand fed my wife as she drove her shift. But we also had to leave normal life itself behind and sacrifice a lot more than I ever could have anticipated. Trucking is a hard life, and yet, bad decisions can make it even harder.
Lastly, one of our high-points was our 2 weeks of Ice Road Trucking supporting the US Navy 2009 Ice-X Program where they test their toys under the Arctic Ice. If you want to see a cool (pardon the pun, at -70* below zero!) video, its on Youtube, called 'Ice Road Trucking - Not Hollywood'. I promise... You will enjoy!
Until next time gang!

 

Wow! Great comments guys (and gals?) !!! And yes... I was asked more than once what I would do, while making all that money, if my sweet bride got off the truck? My answer: I'd be 10 to 12 seconds right behind her, no matter what. Teaming isn't the only way to do it right, but it sure helps to bring family, companionship, and the added ability to sexually harass my 'secretary' without penalties... (-: Come to think of it, we became better best-friends in the truck, with all the stresses and duties and dependence on each other than when we were going steady, only, well, the swear-to-God-truth? We didn't drive through any states with capitol punishment for about the first 3 or 4 months while we 'settled in.' ha* Oh my.. Why someone didn't die is God's guess... (-: (Interstate left me to finish up training my wife while I too learned the rigors of OTR winter driving, as we started in Jan of 2,000. I got about 3 hrs of sleep a day, only to wake up to the sound of the trailer bumping along in the dirt when she took a sharp on-ramp, things like that.) And it grew me in ways that nothing else could have! Ah!! "But love covers a multitude of sins..." ((-:
As far as picking my brain, pick away! My e-mail address is samsvalley777@gmail.com.
There is a good Proverb applied to all that we have accomplished: Without a vision, the people perish. We had set goals early on, and though they morphed, sometimes changed even radically and grew tremendously along the way, we never, ever, stopped looking ahead and working for those goals. Did it turn out at all like I thought it would? Let me put it this way: We started out in 2000 doing the 'truck driving thing' as a stop-gap measure that was 'suppose' to last 5 years... That was 14 years ago. Ranch? Tractor? All we wanted was a little money in the bank, maybe a stick-frame house instead of the single-wide, small stuff, ya know? Doing it right, it just got bigger and bigger!
But again, discipline and sacrifice was the name of the game. And too, I have to say that had we put all that time and energy into doing what we did, driving all those miles, the shear terrors of driving on ice, through hurricanes and the like, missing all that time being away from home and friends, etc, and we DIDN'T end up with what we have today? I would be on Prosac and my wife of 39 years would probably, well, we won't EVEN go there... ha* In short? I would be majorly BUMMED....
What I am writing about here is this: Even through poor economies, (like right now!) I am here to say that even solo drivers can make money at this trucking gig, but you have to set goals, and those on many, MANY levels, including financial, professional, health and retirement. I consider myself an expert in the field of Accomplishing The Big Picture. Having come from a dysfunctional back ground, very little formal education (though highly informally educated on my own!) and no examples for me to follow, I ended up asking a lot of questions and reading a lot of books. I personally know solo's that easily made $50k a year back 10 years ago when the rates were lower, just because they were? That's right, DISCIPLINED.
The trucking industry, and mainly Driving a truck, is peopled for the most part with guys (and gals) that aren't exactly there for the travel experience. In other words, most that sit behind a wheel for employment do so because they can't get by with a McDonald's job and NASA has for the 34th time rejected their bid for a management job, if you get my drift. But the Big But here is this: Trucking, like what my wife and I turned it into for ourselves, is a profession that we can not only be proud of, but also, if you successfully arrive at your destination, the fulfillment of your plan, then what difference does it make whether you did it behind a desk, the yoke of a 747 or the steering wheel of a truck? Success is success, and we found that we could treat trucking as professionally as a doctor would treat his or her medical practice. We do NOT have to be, nor act like a bunch of Bubba's (sorry Bubba! ha*) just because we drive a truck for a living. Though it is only talked about a lot, this nation would indeed collapse in 2 to 3 days without trucks rolling. (Our local Winco super market gets 3 to 4 trucks a day alone to keep it stocked!) The power we hold over the industry, in this sense, is incredible, but the average driver isn't set up to miss a month's work to make a point, and thus the average driver wage is, again, bottom of the garbage can low... This is another issue that I won't get into right now, but if you are a driver and do not belong to OOIDA, shame on you... They are a strong voice in Washington, and without them you would be under a comparable NAZI regime when it comes to new a crazy rules and regulations every year... Anyway....
With that said though, and in short, in the trucking industry in general, it is pretty hard to separate yourself as a professional from the not-so-professionals, the majority that we work with out there. In other words, it seemed like no matter how hard we tried with Interstate, we got treated the exact same way, especially by the 'Night Managers'. (R+R is a 'whole nuther story' and they are awesome!) In a society that expects/demands recognition for doing a good job, it is rare that we get that encouraging word for doing a good job in the driving world. If I were king of the world, I would change the industry from the top down. But then, if pigs could fly, right? Really good, caring and understanding driver managers are hard to find, and always have been...
So, at the end of the day, you are planning, executing and being profession for what? Yourself and your own plan, for it is the only way you are going to be successful in your endeavor, lest you be like the 99% out there that is my age, renting, and don't even know how to SPELL 'retirement'. Now, if that sounds like a discouraging word, its not, because as my wife and I found out, it is never too late to start! I am not kidding when I say that we went from trailer trash to trucker trash. Only 14 years ago, we were poor... Dirt poor... We had our sights set a lot lower than the way things tuned out, but as we settled down to truly get ahead, we learned things, and when we learned, we grew, and when we grew, our sights slowly raised to take on things (like a brand new Volvo truck and then again!) that I wouldn't have DARED to take on 5 years previous. So do NOT give up hope... But...
We all need to get out of our ruts in life to grow. Human nature fights change, ANY change, and yet change is the best thing in the world for us, most of the time. Money itself, but even more so, the way we look at money, is the key element for a good foundation for our future. I would recommend 2 books to get you jump started. The first one is Rich Dad, Poor Dad. The second is The Millionaire Next Door. Amazon.com carries both. I could blah blah blah about these 2 books for HOURS, but in the end, if you are really interested, you'll buy and read them. (They are actually required reading in many business management JC college classes...)
Once you start getting interested in going a new direction, another good source is Dave Ramsey and his debt free living book and radio show. I'm the one with the paid-for ranch and tractor and 400' runway for my wee little planes, and so I'm telling you: It all works... And like any Millionaire will tell you, this kind of wealth comes from one source and ONLY one source, and that is HARD WORK and discipline.
So there ya have it. I'm full of 60 years of doing it all wrong, and then doing it all right and then seeing, and living, the results. Like Winston Churchill said: "Never, Never, Never, Never Give Up!" And again, I say, it is never too late to start.
Later gang!