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With tax season just having passed and the school year ending, freeing up some time for teachers, many teachers are thinking about their personal finances. On a recent podcast episode, we had a teacher and financial planner join us to share some high-level tips on teacher personal finance. This blog gives you a quick summary, but check out the whole interview here.
1. What is different about teacher personal finances versus general personal finance education?
Two retirement vehicles, 403b and 457 plans, differ from a typical 401k. Different perks and benefits – discounts at certain places, tax write-offs for educational supplies, etc. – that should be considered part of a teacher’s overall financial planning.
2. Where should teachers start?
The first step is to figure out what's currently happening. Track all of your income and all of your expenses for at least 30 days. Categorize the expenses.
The second is to identify your goals. You want to think about how to prioritize spending on current needs versus savings. In the savings category, you want to ensure you are accounting for an emergency savings plan, shorter-term savings for any identified needs, and a longer-term retirement savings plan.
The third step is to look at ways to increase your income. Look at your school’s salary structure and see if there are ways to get a higher salary – e.g., through continuing education credits – and whether there are additional roles or jobs you can take on.
3. If someone already has a strategy, what should they do?
Reevaluate your strategy and see how you’re tracking your goals. Look at your retirement accounts and ensure you are maximizing those investments and minimizing any associated fees.
4. What are the best resources to get smarter about teacher personal finance?
There are many resources out there on YouTube, Facebook groups, as well as through specific individuals. Rob lists his favorite here.
We hope these tips are helpful!