This article is from the Aviation FAQ, by Geoffrey G. Peck firstname.lastname@example.org with numerous contributions by others.
Aircraft ownership expenses are highly variable. Two owners of essentially
identical airplanes may disagree widely on the cost of owning. Here's a
guide so you can put together your own cost model.
Fixed expenses - you'll incur these no matter how much or little you fly
o Capital cost - the cost of the money you've tied up in the aircraft.
Some pilots say "don't count this - the airplane is an investment and
will appreciate". Others say "even if you buy it outright, you've got
to look at what that money would earn you on the open market".
o Taxes - varies by state and county.
o Insurance - get several quotes before you buy. Can vary from a few
hundred dollars a year to over $10K per year for a piston single.
Factors influencing cost include coverage chosen (liability limits,
hull limits), pilot qualifications (ratings, total time, time in type,
violations/accidents), type of use (personal, commercial), etc.
o Hangaring or tiedown costs - vary from about $20/month to over
$1000/month for a single-engine aircraft.
o Annual inspections - labor cost of the required annual inspection;
repairs are additional.
o Paint and interior reserve (does vary somewhat with hourly operation,
but typically more tied to age than flight time unless you fly a lot).
Variable expenses - these are typically proportional to hourly operation
o Oil changes every 25 or 50 hours of operation
o Engine / propeller overhaul reserve
o Maintenance reserve
o Avionics reserve
o Maintenance labor rates can vary from about $30/hour in some rural
areas to $120/hour and up per mechanic in major metro areas at
specialty shops. If you elect to perform owner maintenance, you can
save a lot, but isn't your time worth something in the calculations?
o When buying an aircraft, the first few years of operation are likely
to be much more expensive. For example, if you have an engine with
1400 hours on it and a 2000-hour time before overhaul (TBO), you can
expect to fly it *at most* 600 hours before you need a new one.
If the engine overhaul cost is $25,000, you ned to set aside at least
$41.66 for every hour you fly (25000/600). And the engine probably won't
make it all the way to TBO. After you've done the overhaul, the engine
reserve number goes down to $12.50/hour. Beware that this calculation
applies to other major components (paint, avionics, etc.) too!