Teacher Salary? How to Make Your $ Work for You

Photo by Miguel Á. Padriñán from Pexels

"Money doesn’t buy happiness, but I’d rather cry in a Lamborghini." While I don’t necessarily agree with this statement because I'd much rather cry in a Range Rover... while wearing Louboutins, it does, however, represent an idea that is true for many. So, while money is certainly not the key to being happier and living a more fulfilling life, having a little extra cushion of cash, especially for those of us in our twenties, could help us live more comfortably.

You may have recently seen the viral photo of Will Ferrell wearing a T-shirt that reads “Pay teachers more money”. He’s not wrong. Teaching is one of the most underpaid professions… okay, maybe I’m biased, but you can simply Google it to see for yourself. Teacher salaries leave a lot to be desired considering the job we do and the impact we have daily. However, that doesn’t mean you can’t survive, and even thrive, on your current teacher salary. Believe it or not, salary is not the biggest indicator of an individual’s financial success. In fact, almost 1/5 of Americans with a six figure income live paycheck to paycheck. Here’s some simple personal finance tips anyone (teacher or non-teacher) can instantly implement to help you live even more comfortably:

Pay Yourself First

I can’t stress this enough, AUTOMATE YOUR SAVINGS. By this I mean simply set up an automatic transfer every pay day to your savings account. This way, when the money comes in it’s not there for you to spend and, trust me, you won’t even notice it’s gone. Even if it’s just $10 a paycheck, that $10 adds up over time. 

Budget- 50/30/20

Budgeting is something that should be empowering, not restricting. It’s all about knowing what you spend so you can save more. I personally like the 50/30/20 method because it allows you to be broadly specific while giving you an overview of where your money goes. 50% of your budget should go to essentials, such as housing. 30% to your lifestyle. This includes the fun things like happy hour, fitness, travel, and shopping. Lastly, 20% of your budget should go to your future. This is the money you’re proactively putting towards your future self, which is why it’s important to automate it. That leads me to where that 20% you’re saving could go... the high-yield savings account. 

Open a High-Yield Savings Account

A high-yield yield savings account is just like any other savings account, but it earns higher interest. If your savings is in a regular bank, it is barely earning interest- typically between 0.01-0.04%. With the rate of inflation, that means you are essentially losing money. A high-yield savings account earns around 1.5-1.7%, which is nearly 170 times more. Transfer your savings to a high-yield savings account today! Capital One, Marcus by Goldman Sachs, and Ally are just a few that all offer great options. 

Contribute to Retirement

Whether you have a 401k or a 403b (@ all my teacher friends out there) you should be contributing to retirement. Educate yourself on your employer match and take advantage of it by contributing at least up to the match, because it’s essentially free money. 

Invest

Don’t wait to invest! The best time to invest was yesterday, but today is always better than tomorrow. If you’re anything like me, just the thought of investing can be a bit intimidating. This is why there are roboadvisors such as Wealthfront or Ellevest, which do the investing for you. This way you can passively invest, sit back, and watch your money grow. 

There you have it- these are 5 steps you can take today to start making changes to your personal finances! Whether you’re working with a teacher, entry level, or six figure salary, these are simple ways you can make your money work for you. I am in no way a financial advisor, these are simply some tools that I have found work! Happy saving!