Teachers are tasked with a very important job: educate future generations. But are they taking the time to plan for their own futures?
As a teacher, you make plans to help set your students up for success, but it’s also important that you make plans to set yourself up for a successful financial future.
Here are four ways you can make smart money moves that allow flexibility and stability with your finances.
Money-Smart Moves To Make
Pay Off Student Loans
Whether you’re fresh out of college or a seasoned teacher, one of your priorities should be to pay off student loan debt. It’s important to find a payment plan that fits your budget and helps minimize stress. If you can, pay more than the minimum payment to pay off your loan as quickly as possible as well as decrease the amount of interest you’re paying.
The federal government offers a variety of income-driven repayment plans to help ease the impact to your budget. Also, teachers may be eligible to participate in a loan forgiveness program to partially or completely erase their federal student loan debt depending on where they work.
Build An Emergency Fund
Life happens unexpectedly with unexpected costs. Having an emergency fund with three to six months’ worth of expenses could prevent you from taking a huge financial hit.
Need guidance on getting started? Try the Pay Yourself Strategy or even the 52-Week Savings Challenge.
Create A Budget
Calculate your take home salary (total income received after the deduction of taxes, benefits, and voluntary contributions) and then track your expenses for at least 3 months – keep in mind out-of-pocket spending for classroom and student needs. Once you’re armed with this information, you can create a realistic budget and stick to it.
Also, look for special grants or loans offered to teachers to help with planning and classroom costs during the school year.
Plan For Retirement
Regardless of how far off it may seem, planning and saving in advance for retirement can ensure long-term future financial security. It’s important to research the variety of retirement options available and choose what best fits your retirement goals.
For example, your pension plan may only cover part of your teacher’s salary once retired, so paying into a contribution investment plan – a 403(b) and/or 457(b) plan – can help supplement your pension payout. Also, make sure to check with your employer, school district, or Social Security Administration whether you’re eligible for Social Security retirement benefits. Many public school districts don’t pay into Social Security which would render you ineligible to get this benefit in retirement.
By making these money-smart moves, you’re setting yourself up for financial success creating a peace of mind that your future is secure.