This is “The million dollar question” according to a commenter in one FB group. I refrained from pointing out that we all WISH it were a million-dollar question. The good news (um, good????) is that how to replace a teacher’s salary is definitely NOT a million dollar question.
That doesn’t keep it from feeling like a million dollar question to anyone trying to figure out how on earth we get out of teaching.
If there were an easy answer, I wouldn’t be writing this post. Every teacher would just figure it out and do it. (We really are NOT as dumb as most legislators seem to think we are.) But there isn’t an easy answer. In most cases, it is going to be tough. In some, it might be impossible. And then one just has to make a decision. Is the risk of going back to school is greater or than the risk of not making enough money to pay the bills?
But for most people, taking things step-by-step and breaking it into small sections will help.
What do you need to replace?
First, find out what you really need to replace. Is it really 100% of your salary? Instead, could you can reduce your expenses to give yourself a bit of breathing room? If you want more details on how to compare income with expenses, check out my blog post here. Also, even if you don’t think you can give anything up, sign up for a free 5-Day Found Money Challenge to help you lower your monthly bills. It will walk you step-by-step through how to lower your monthly bills, even without changing your lifestyle at all.
What if you have tried to lower your bills, and you still need to make 100% of your current salary – or more? Ideally, you hit the jackpot and find a job that out and out replaces your benefits and salary. They are out there. Here is one of my favorite job boards, which focuses on ed tech (usually remote) jobs for teachers.
Most of us are going to need to be a little more creative. And it won’t be easy. But in most cases, it is doable.
Your Magic Number
If you can’t find a job right away, but need to get out fast, you may need a variety of options to mix and match so that you can finally meet that magic number. And what is that magic number? Let’s break it down. Take your yearly salary and divide it by 50. That will give you the amount you need to earn each week to set aside money for taxes and still equal your original take home pay. Do NOT base it on your take home pay unless you plan to set aside 25% of what you earn for taxes. I have also included 2 weeks of vacation because I like to be conservative. And we all need a break now and then.
Some of these might be actual ‘jobs’, while others will be side hustles that you do on your own. I am going to refer to them generally as Income Earning Activities, or IEAs. Most likely, you will need to have some IEAs that provide a fairly high number of steady, predictable hours but do not pay as well per hour. Then you are going to make up the remainder of the amount with IEAs that pay more per hour, but don’t offer as many hours or are less predictable.
Allison’s plan to replace a teacher’s salary
Let’s look at a real-life example. Allison (not a real person) makes a yearly salary of $55K at her teaching job. She has cut her expenses as much as possible. Unfortunately, transferring to her husband’s insurance increased their monthly expenses again, wiping out her gains. So she is looking to replace the full 50K. She hopes to return to teaching second semester.
When we divide that by 50, we get $1000 per week. Holy cow! This is going to be tough.
After spending about a week scouring online jobs and applying, Allison is able to get a full-time job online paying $18.50 an hour. (Here is a link to an example job that teachers would qualify for.
She is working full time at $18.50 an hour, so she now has $740 of that magic number covered. The downside is that this is a temporary 6-month position. However, she is really just planning to use this job to cover the bills until she can get a permanent position, so that doesn’t concern her.
She now needs to cover $300 per week. There are not many families in her area that can pay for teachers to help in the evenings or on weekends. She is able to find one family that needs evening help and can pay $20 per hour. She will be supervising and helping with homework (not teaching) for 3 kids two nights a week for 3 hours each night. That gives her an additional $120 per week.
(NOTE: When I create scenarios, I do it based on actual research. I also try to present them conservatively. I would NOT recommend a certified teacher charge less than $40 per hour for working with three kids. However, in this situation I am lowering that amount considerably just to build in a bit of cushion. Based on my research there is a big demand for teachers to do in-home support. Charging $20 per hour would be on the extreme low end of the scale. In some areas, I have heard of parents paying over $80/hour for an experienced, certified teacher.)
We are now $180 per week below what we need. Allison decides to try out Shipt. She can work for Shipt on Saturday mornings and Sunday nights. She has heard that Friday-Sunday is the busiest time for Shipt, with Sunday night being a peak time. That works with her full time job and her part time arrangement with the family, so she applies.
Although it varies a LOT, she has heard that Shipt shoppers can average $17 per shop. Since each shop usually takes about an hour, that’s about $17 per hour. However, those are people who have a lot of practice. Since she doesn’t want to be left short, she figures that she will count on $12 per hour from Shipt. Again, we are building some cushion in. That means she plans to do about 15 hours of Shipt per week. That is a LOT, but with 5 hours on Friday and Saturday, plus 3 hours two other nights during the week, she will reach her goal with some cushion. If she earns her $180 faster, she can knock off for the week OR put that money aside in case she has a slow week at some point.
Big reminder
This is a big one. We are figuring everything here based on gross salary. That means that when Allison puts the money in her account, it will seem as if has more coming into her pocket than it seems like she needs. Why? Because while her employer WILL take out taxes, her side hustles like Shipt, VIPKid, and the families she is working with will NOT. She needs to take about 25% of her side-hustle income and put it into a totally separate account so that she won’t get a big, bad surprise next April 15. She can put it in an account that will earn her a little interest, but it should NOT be in any kind of investment that could lose value. Just a plain-old bank account so it will be there when she does her taxes next year.
Real Life
But she doesn’t really like doing Shipt. And it doesn’t pay nearly as well as her other jobs. She decides to try to work her way out of doing Shipt, or at least minimize it. Allison has always loved reading, and she has heard that you can build a full time income by indexing non-fiction books. She knows it will take a while to build a clientele, but it sounds like a great fit for her that she can continue even if she finds a full time gig.
But, in the interest of keeping this a real-life scenario, we have one more curve ball to throw at Allison. Her full-time job doesn’t start for a few weeks, so her first $740 pay check will come 3 weeks after her last pay check from her teaching contract. That leaves her $2240 in the hole.
The good news is that she didn’t wait for her teaching contract to act. She has been doing Shipt for 4 weeks already and started working with the family 2 weeks before her last teaching pay check. That means she saved up about $1500 from Shipt (she was able to work more when she didn’t have a full time job) and $240 from the family. She still has $500 to cover.
Allison gets a little worried until she remembers that she received a promotional add that would pay her $300 for opening a new bank account with direct deposit. She takes an hour or so, opens the new account and uses it for the direct deposit of her new job’s paycheck.
She is $200 short, but she decides to do an extra 2 hours each week on Shipt until she makes up the difference. Even though she does have $1000 in her savings account, she would rather work the extra time than dip into that.
So there you have it. It is a completely made up scenario of how to replace a teacher’s salary. But it is based on research and real numbers. If you have a scenario you want to tackle together, comment below, and we’ll do our best to work through it. I can’t promise we will come out in the black, but we will do our best.
And remember. This isn’t going to be easy for any of this. But I believe in you. You’ve got this!
OMG. Yeah. As I write this, the US is barreling full tilt toward opening schools with a pandemic raging out of control. As I look through FB, my friends and colleagues are freaking out. And the very first school corporation in Indiana just made the call to go 100% virtual this fall. I’m praying that all the rest follow suit. But if yours doesn’t and you are in a position where you just can’t return to school in person, here is my best advice to help you quit teaching without ruining your life.
I have been researching personal finance for about 20 years now and side hustles for about 2. Here I’ve tried to assemble the best information I can as quickly as I can. That doesn’t mean it is complete or error-free OR right for your personal situation. You need to make your own decisions and do your own fact-checking and due diligence. But I hope this will spark some ideas and at least provide resources and a starting point for teachers who feel like they must leave the classroom or who have been shaken into the feeling that they may have to in the future and want to have a plan in place.
There will be a lot of links to other posts that might be helpful, either from my own site or others.
Please help me to provide the best info out there. If you have a valid suggestion for insurance or a company that is hiring for LEGIT work from home positions, comment below. Posts about MLMs, direct sales, self-promotion, or other comments that just seem scammy will be deleted. Thanks!
Step 1 – Slow your roll
DO NOT quit teaching or resign from your position unless the return to school is almost immediate. In my home state of Indiana, districts just today (July 13) started re-evaluating their decision to physically open schools. I believe that other districts will soon do the same. The last thing I would want for you would be to resign and then find out that your school is going to be 100% virtual to start the year.
That doesn’t mean that you can’t take action. On the contrary, following the steps below will put you in in MUCH stronger position to walk away on short notice if you decide that your district is not taking adequate steps to protect you.
Step 2 – Communicate
With your partner
If you have a partner, this should probably be the first person you communicate with. Do they share your concerns? If not, you are going to need to work together to figure out at what point you would indeed quit teaching and stay home. Try to put specifics on it, such as infection rate, number of new cases, or specific policies from your district. If you are on completely different wavelengths, it could add serious stress to an already stressful situation. In short, you know your relationship best, but for this to work, you will need to reach some kind of agreement.
With your employer
School districts are in a tough position here, too. They are trying to balance the needs, wants and fears of many groups all at once. However, if you are seriously considering leaving your position, this is important for your principal and HR department to know. They might want to open schools virtually for a few weeks, but be under pressure from another entity (cough cough – US Department of Education – cough cough) or from parents to open in person. If they know that a large number of their teachers are willing to resign rather than return in person, that gives them a realistic idea of how difficult opening will be and might help them to justify opening online. (Normally, I do NOT accept administrations pushing difficult decisions off on teachers, but in cases where it will literally save lives not to open schools, I am not super picky.)
With your union
If you are a member of the union, check with them before you make any solid decisions. They should be working with the administration to help teachers cope with this previously unimaginable situation. Some corporations are offering an unpaid leave of absence for up to a year. Some have other options. You won’t get your best deal unless you inform yourself, and often the union can offer ideas that might not occur to most of us. PS If you are not a member of the union and you don’t have a specific reason, you might want to reconsider that. Just sayin’ 🙂
With your support network, either virtual or IRL
This is a fine line to walk. You don’t want to operate in an echo chamber, but you also don’t want to share your fears with people who will belittle you. And that’s a real concern right now. This is some scary sh*t going on, no doubt about it. But examining our own assumptions is also a healthy thing to do. You know your situation best, so choose carefully who you do – and don’t – communicate with.
If you feel comfortable talking with extended family and close friends, you might want to just see what help and insight they might be able to offer. Do they have experience with making money on the side or a better understanding of health insurance than you? Maybe someone you know would love to pay you to help them manage online education for their kids while they work from home or to deliver their groceries or something else. Communicating with a slightly larger group will help you form an accurate picture of what support you might have.
Step 3 – Take stock of your situation
Leaving a stable profession is not a step you should take lightly. But then again, neither is returning to a classroom full of kids during a global pandemic. So give this some thought, and try not to be ruled by your emotions. The goal here is to focus on fact and get an understanding of the risks and challenges.
as to health risks
To what extent will returning to school put your health or that of your loved ones in danger? Some items to consider are
the infection rate in the district where you will be teaching
the health of yourself and your family members
your mental health
your ability to enforce safety measures in your classroom
the number of students you will be in contact with each day
your faith in the district leadership to be open and transparent, your current financial situation
any potential job leads you already have.
All of these pieces will play a part, and each will have a different weight on the decision based on your particular situation.
Write these down in a format that works for you. It could be a table, a mind map, or a spreadsheet. The important thing is to get the info out of your head and into a format where you can see it and use it to make a rational decision.
and money
This is the other big part. For many teachers, this would be THE major hurdle keeping them in the classroom. This is a whole blog post in and of itself, so that will be coming soon. Keep your eyes peeled for it. For now, let’s just focus on the basics.
You need to know how much money you NEED to pay your bills each month, so I am going to say the dreaded “B” word. That’s right, budget. You must know how big of a gap your quitting would leave between your family’s monthly must-haves and your monthly income. If you are serious about the possibility of not returning to school, it’s time to do the crappy stuff.
Assemble as many bills as you can from online and hard copy sources. Try to have credit card bills and bank statements back for at least 12 months, if possible, so you don’t forget about expenses like life insurance that you might pay only one time a year. But if you can’t go back that far, don’t let that paralyze you. Use what you have.
Figure in any other income you may have – a spouse’s paycheck or unemployment check, child support, whatever – and look at the gap. Now that we know what our situation is, let’s look at insurance.
Step 3 – Ensure your health insurance before you quit teaching
This is the other major hurdle for most of us. If you have a spouse with employer-sponsored health insurance , the first option would be putting your family on that plan. Most of the time a change in employment is a qualifying condition that will allow changes in who is covered, but the cost will most likely change.
Even if you think this is your best option, do some research to 1) be sure you CAN get onto your spouse’s plan and 2) learn how much it will cost.
If you can’t rely on another family member’s insurance, things get a lot stickier. I’m not going to lie: I have not found a great answer here. I am researching it and talking to actual people who are self-employed and have had to get insurance. I will update as info comes in. So far, the best that I have found is the ACA coverage from the federal government. To get more info and find out whether you could qualify, you can click here.
If you are leaving employment with a school corporation, you have the option to take COBRA. However, chances are that it will be prohibitively expensive. With that said, there is NO WAY I would go without health insurance right now unless I was just planning to take the chance of having to declare bankruptcy. If you are in a position that is serious enough that you absolutely can’t go back to school and your corporation will not work with you, that might have to be an option. (Hey, bankruptcy is bad, but losing your life or losing a family member is worse.) But it should be a last case scenario.
Finally, if you know a secret in this area that I don’t, let me know!
Step 4 – Lower expenses (A great thing to do, even if you DON’T quit teaching!)
In step 2, we looked at the gap between your income and expenses. Now, let’s shrink the gap.
Once you know how much your current expenses are, think about how much you could cut. Obviously, if you have kids doing online learning, Internet is a necessity, as is food, housing and a lot of other things.
But what could you do without? Shopping for clothes and non-essentials? Restaurant meals? (I hope that if you are seriously considering quitting teaching that you haven’t been in a restaurant in months. But I know a lot of people have been relying on Door Dash and take out to provide a bright spot in a dreary time.) What about subscriptions you don’t use or may have even forgotten that you have? You’d be surprised what you might be paying for without even realizing it. (If you want to go step-by-step through your money and see if you are paying for things you don’t even use, check out my 5 day Found Money Challenge below.)
This is not going to be accomplished all in one day. You will probably think of things you can do without over the course of a week or more. Just keep whittling those numbers down and see how small you can get the difference.
Step 5 – Create immediate income
In a perfect world, your work would be done. You would have income from some other source and low enough expenses that you could buy yourself some time to breathe. What we are looking for here is money to close the gap between your essential expenses and your income for the first few months that you are out of work. In this step, we are just looking for enough income to fill the immediate gap.
We all know this isn’t a perfect world, so let’s look at other options. What we are looking for in this step is money to fill the immediate gap. If you have an emergency fund, that could be your answer to this step.
If you don’t have any money in savings, yyou need a source of immediate income. Depending on your circumstances, working with a few families that need help with virtual schooling could be a great option. I’ve created a forum for teachers and familiesin Indiana to connect. You can sign up by clicking the links in the previous paragraph. If you are outside Indiana, check FB groups and Google to see if the same thing exists for your state. If not, comment below and I’ll do my best to help you set one up.
Note: Any work that you do as an independent contractor will not have taxes taken out, so it is a good idea to set up a separate bank account any deposit about 25% of income from non-employer sources directly into it. This can keep you from getting a nasty surprise come tax time next year.
There is also an increased demand for delivery workers right now. Besides pizza delivery, these 7 delivery companies might be worth investigating. I know delivery might not sound very appealing, but the key here is to get some income right away until you can put more permanent plans in place.
One of the first things that teachers think of is teaching English online. You can read more about VIPKid in this blog article but based on what I am hearing a TON of new teachers have signed up since the shut down and bookings are extremely slow. So don’t count on this as an immediate plan. Put it in the long-term category.
There will probably be another post on this coming soon, so check back if you need more info on immediate opportunities.
Step 6 – Create long term income
Here we are talking about putting a longer term plan in place, say 3-12+ months. If you are able to take a leave of absence from your job and have your expenses covered, this step might not even apply to you. On the other hand, some school employees will finally be pushed over the edge by the lack of concern shown for their safety and will be looking for more permanent employment.
In that case, you’ll need to do some soul searching about whether this is a good time to create a job for yourself through entrepreneurship, or whether you want to search for another full time job. If you’ve always wanted to start a small business, well, this will be a tough time to do it, but there are some solo-preneur ideas that just might work. They all take some time to start producing income, which is, of course, why they are long term plans.
My favorite solo-preneur idea is indexing, and you can read more about it here. Even with all the hype around work-from-home jobs, it seems to have gone unnoticed. There are other real options for working from home, though. Virtual Assistants are becoming more and more popular, especially those who have a sought-after niche. Some VAs specialize in Pinterest, others in Facebook ads. If you think being a VA would appeal to you, here is an article on 17 specific VA niches.
Otherwise, while a ton of places have been laying off employees, others have increased needs and are hiring. Here is an article about openings from May, and another one from January about some of the best companies for remote online work.
Whatever you decide, remember to make your decision about whether to quit teaching based on solid research and facts, not panic. And remember, you’ve got this!
So you are thinking you need a side hustle, but you are frustrated because you feel like there is not much you can do until society opens up a bit more? Actually, ground work you do now could put your side hustle or micro-business light years ahead of where you would be if you jumped right in. Here are 5 questions to help find the perfect side hustle for you.
What are my side hustle priorities?
And do not write: “#1 Make money. #2 See #1.”
NO. I mean, really give this some thought, based on your personality and your family situation. What are the underlying reasons you have for wanting a micro-business or side hustle? Is it for little extras like vacations, eating out, or other treats you could give up if the market turned down? Or is it to pay rent or medical bills?
If it just ‘fun’ money, you can choose something that is good in good times and not good in bad times. But if this side hustle is the difference between you making rent or a car payment, you are going to want to give serious consideration to side hustles that will produce income no matter what the general economy does.
Another thing to consider is your family situation and life goals. Do you have kids? If so, what is best for them is going to play a major factor. I’m not trying to be alarmist here, but one of the (several) issues that kept me from every seriously considering using our extra room as an AirBNB was the fact that there was no separate entrance, and I didn’t want strangers in and out of our house when our kids were little.
Another thing that I would love to do is pet sitting. Unfortunately, my husband is allergic to both cats and dogs, so that is a non-started based on our family situation.
Be aware that your goals and situation will change over the years, so don’t try to predict everything that could possibly happen. But don’t be unrealistic about the facts, either. If you have 4 kids under age 4, a Saturday afternoon Mom’s Day Out babysitting service might be a lot more practical than a side hustle that requires hours of uninterrupted concentration.
Some ideas to consider:
Is this going to be ‘fun money’ or is it money you need just to pay the bills?
If you have a significant other is s/he on board?
Is it more important to you to make money right away or to have the potential to grow your income?
Do you need to be able to do your side hustle from home? While watching your own kids? At a certain time of day?
Do you have plans to move to a different city within the next few years?
Are you looking for something that could eventually replace your day job, or do you just want some extra cash on the side?
Is this side hustle recession proof? COVID-19 proof?
There are a lot of great side hustles out there that are only great until the economy goes south or we have another shutdown. That’s why it matters so much whether this is ‘fun money’ or you are relying on it to pay the bills.
If it’s fun money you have a little more freedom to choose based on what you will enjoy doing. If it is essential income, the last thing you want is to choose a side hustle that is super fun, but dries up the second people start cutting back on their own spending.
In the era of COVID-19, it’s also worthwhile to think about whether this is something you can do if your city or state shuts down again. That really limits the choices, I realize. But remember, you don’t have to rely 100% on a single side hustle. You can do Uber AND test websites. You can have a Mommy’s afternoon out where for Stay-at-home-moms AND do VIPKid. But you don’t want to count 100% on a side hustle that will drop to $0 in income with the first blip in the economy.
What side hustles can I pair up to get the best of both worlds?
Let’s look at a specific example. Let’s say you look at the options and decide you LOVE the idea of indexing. It seems right up your alley to be able to read books at home, create an index, and make money for it. (If that sounds like a dream job to you, check out more info here.)
But it just won’t work because you need to make $150 a month to pay your basic expenses. That is non-negotiable. And it needs to start this month, so you don’t have time to wait for the indexing to ramp up. So you think Uber might be better. But you know you can’t do Uber if there is another shutdown. Plus, you hate to give up the chance to create something that you could actually turn into a career in the future.
Newsflash: This ain’t a marriage. You can two-time your side hustles. You can have one to cover the essentials and one to build into the future. So you do Uber until you’ve got th $150 to cover your expenses, then spend the rest of the month on building your indexing side hustle. With luck, the indexing will eventually provide the full $150 you need a month – and more!
This side hustle doesn’t work for me. What else can I try?
OK, going back to that old relationship analogy. No one goes on one date and then dispairs if the person wasn’t Ms. or Mr. Right. Going into the side hustle search with the same attitude – that there will be some things that work out and some things that don’t – makes it a lot more likely you’ll actually be successful.
If you have gone through these steps and really given them some thought, make a list of 10-15 side hustles that could work based on your priorities. You might have to dig deep to get to that number, but sometimes those ideas that you stretch for are the ones that work out.
Here is an example list for someone who wants to work at home, needs to watch their kids at least part of the time, and has some background in art and design: running an in-home daycare, selling crafts on Etsy, flipping items on E-Bay, teaching English online though a service like VIPKid, offering a subscription box service with a focus on art for kids, creating and welling Pinterest templates, doing SEO optimization, testing websites, selling lesson plans on Teachers Pay Teachers, selling photos online, teaching Mom and Me art classes from home or doing calligraphy for weddings.
The important thing is not that you love every idea on the list; it’s that if one idea doesn’t work out, you have others to fall back on. Just don’t fall back too fast. Give each idea at least a couple of months to see if it will work, and longer if it is something that you have to build up, such as art classes or a subscription box.
A final thought: Your priorities will change
Moreover, even if you find a side hustle you love, that doesn’t mean you’ll love it forever. One of my side hustles was selling real estate. Man, I loved it! I’m a real estate addict, and I love talking real estate and helping people find their dream home. It’s totally something I would do for fun even if nobody paid me to do it.
But when I became a single mom, that just wasn’t an option anymore, and I had to say good-bye to that particular side hustle.
In another case, my preschool Spanish classes were really taking off when I realized that our family would be relocating within the next couple of years. Unfortunately, my business model was location dependent. So while I could take what I had learned and start over in a new place, it would definitely be starting over. As much as it broke my heart, I gave up my Spanish teaching business because it didn’t make sense to continue to pour my blood, sweat, and tears into it when it wasn’t portable.
But I didn’t stop. I still love my side hustles. Now I just prioritize options that are location independent.
Like I said, your priorities will change. You are likely to pivot several times before your find your long-term love. Hey, nothing is saying you won’t do the side hustle equivalent of marrying your high school sweetheart. But if you don’t there’s still a happy ending out there for you if you keep on trying.
“Financial freedom” (also called financial independence) and “teacher” aren’t words that most people associate together. Not trying to brag on us here or anything, but “overworked” and “underpaid” are often more the go-to images of an educator than “working because she wants to”. Financial freedom for teachers is just not a trending phrase, despite the desperation of many teachers to get out of the classroom, either temporarily or long-term.
And yet, in some really important ways teachers are in a really, really good position to gain financial independence. So don’t let people tell you it’s impossible. There are more teachers out there who have achieved financial freedom than you may believe, and I’ll be highlighting some of them in a future post. Right now, here are some of the reasons why teachers can indeed achieve financial freedom.
NOTE: this post doesn’t deal with the insurance issue. I’m still researching how insurance fits into the picture. If anyone has decent insurance options, please feel free to comment below. I would love to hear them.
What is “Financial Freedom for Teachers”?
Before we get into the reasons, though, let’s make sure we are all on the same page. What is financial freedom for teachers? Almost every personal finance blogger will have a slightly different definition, so I’m going to just go with mine. When I talk about ‘financial freedom for teachers’, I mean the ability to know that you can teach or NOT teach without money being the deciding factor. So I’m not actually talking about you and your spouse being able to move to Tahiti (although that could be YOUR definition of financial freedom). I’m talking about either temporarily or permanently deciding to go without your teaching income and doing so knowing that the bills will still get paid.
What could cause you to walk away from a job you love? Here are a few things that I can think of.
You have 2 kids under age 3, a husband who travels for work and something’s got to give. You just can’t do a good job of being a mom and a teacher both at this exact moment. (This one happened to me.)
You just had a baby and have only 4 weeks of sick leave saved, so at the end of that time, you have to either go back to teaching or go without income. (This one happened to me.)
A family member becomes seriously ill and needs more help than you can give while teaching full time.
There is a job change that makes teaching miserable.
You are put in a position where standing up for your students or for what is right will put your job at risk. (This one happened to me. Do you see a pattern emerging here?)
You have the chance to move to your dream location and have the adventure of a lifetime, but you don’t know if you will be able to find a teaching job there. (Ahem, you guessed it. This one happened to me.)
And the current winner: Your state and/or district are forcing teachers to return to on-site classes during a global pandemic and it is JUST. NOT. SAFE.
All of these examples have a real impact on your family life and your mental health. And while you might know that you love teaching and you want to return to it someday (Yep. This happened to me!) – or not – financial freedom is the ability to leave the classroom if you need to.
So, with that, here are the many reasons teachers are actually in a great position to achieve that.
Low salary
Yep, you read that right. One of the reasons that teachers CAN achieve financial freedom is that they have a low salary. That sounds TOTALLY counter-intuitive. I imagine you’re thinking, “So you are telling me that it is EASIER to become financially free with a low salary than a big one? Well, Jill, we need to review basic math and basic logic. Which one would you like to start with?”
OK, you have a valid point, but low salary also means teachers don’t have a ton of income to replace. If a doctor wants to quit work, she often has to replace $150K+ or more per year. But the bonus of the low average salary we teachers earn is that many teachers would have to replace only a third of that – $50K or less to replace their income.
(Not) Keeping up with the Jones
That’s not news to any of us, but another aspect of that might be one that you haven’t thought of. Because pretty much everybody knows that teachers aren’t raking it in, they don’t have the same pressure to keep up with those crazy Joneses that people in other professions may.
Let’s go back to that doctor/teacher comparison, shall we? Let’s say a teacher chooses to drive a modest used Toyota Camry. That’s pretty much standard for teachers, so chances are no one would even notice. On the other had, let’s say our doctor – a surgeon – drove the same car. Don’t you think they might feel out of place parking next to their colleagues’ BMWs, Audis, and Saabs? Now, I know I am relying on stereotypes here. There are teachers who drive BMWs and doctors who drive Camrys. But I would say that isn’t the norm.
And cars are only one aspect of it. What about private school? Ski vacations? Family trips to Europe? Those are just part of what most people assume a high-income earner will do. Teachers, while they may choose some of these more expensive options, aren’t necessarily assumed to be tightwads if they opt for cheaper alternatives, either.
Think I’m making this up? No. In The Millionaire Next Door Thomas Stanley and William Danko, who spent years researching millionaires, came to the same conclusion. If you haven’t read it, you’ve got to. It’s one of the best personal finance books I’ve ever read.
Summers
Final thought: summers. I know, you are sick of people saying, “Why do you complain about what teachers make? You get summers off!” But those summers , besides being an essential part of recharging our batteries so we can go back at it the next year, are a valuable resource to begin closing the gap between your income and your expenses.
Say you decide to start a side hustle during the summer. Something you actually enjoy doing, but can also get paid for. And you spend about 20 hours a week on this side job for about 6 weeks of the summer for a total of 120 hours. (For info on side hustles that can earn you some serious money, check out my posts on VIPKid, pet sitting, indexing or other side jobs that bring in great money.) You start up slowly because it takes a while to figure things out, but that first summer, you earn about $2000 dollars, which is absolutely do-able. That works out to between $15 & $20/hour. Not great, but not so bad, either.
Summer numbers – had me a blast
Now that you’ve got the hang of it, you decide you are going to continue it during the school year, but only about 5 hours a week. After all, you chose something you actually enjoy doing, so why not? But now you are better at it, so you earn an average of $20/hr. That’s $100/week, or an extra $400 a month. Let’s say you skip back-to-school month, and two other months during the ten-months of the school year. That’s still an extra $2800 at the end of the school year. You have earned $4800, and you are now almost $5000/year closer to being able to quit teaching.
And if you have used that money to pay off some debt, your monthly expenses might even be going down as your income is going up. You can start to see how this whole thing could actually work. It won’t be easy, but it could definitely happen.
Bottom line is this: if you are determined to find reasons you can’t have financial freedom, you’re right. On the other hand, if you are determined to find reasons you CAN, you’re right, as well. To a large extent, what you believe is possible will actually influence what is possible.
Even if you honestly believe that leaving teaching is impossible for you in your current situation, there are loads of things you can do to make it a viable option in the not-too-distant future: investing in your retirement funds, paying down credit card debt, buying used cars when an upgrade is necessary, and doing more cooking at home, shopping at nice consignment stores instead of. Little things mean a lot, and even more importantly, they put you on a path you want to follow long-term.
When you look at personal finance writers, you are usually going to find people who fall into one of two categories. 1) Those who emphasize increasing income with side hustles or asking for raises. 2) Those who emphasize reducing expenses by eating at home and foregoing the daily latte. It’s not true of every blog and podcast out there, but if you look at the majority of them, you’ll find they lean one way or the other.
People are the same way. Often, we either feel more comfortable reining in what we spend or ‘dream big’ and look for the side hustle or career breakthrough that will shoot our income through the roof and let us leave money worries behind forever.
Team Spend Less
Folks on team ‘spend less’ cite millionaire sports heroes who have declared bankruptcy and the fact that most lotto winners who cashed in to the tune of millions are broke again within just a few years. (True. You can look it up.) Obviously, they point out, all the money in the world won’t fix your problems if you can’t control your spending. So there!
Team Dream Big
On the other hand, team ‘dream big’ points out, you can only reduce your expenses so much, but your income can increase infinitely. Plus, while you’re trying to save $0.07 per serving by soaking your own dried beans instead of splurging on that outrageously overpriced can of beans, your life gets smaller and smaller. That’s no way to live. Mic drop.
Yup. And Yup.
Like most things in life, both are right and both are also a bit wrong. (Imagine that! Nuance. A life lesson that can’t be contained in a 10 second sound byte. Hm, who’da thunk?)
So here’s the short version. No, you can’t save enough to put yourself on sound financial footing if you make $15K a year and have 5 kids. It’s just not gonna happen. But if you ignore the saving side entirely, no amount of money will ever be enough. Just like your income can always increase, so can you always manage to find more things to spend your money on.
The trick – and this is the part that no one can do for you , you’ve got to do it for yourself – is to find that balance, an then stretch yourself just a bit beyond your comfort zone in the area that makes you uncomfortable.
Out of the comfort Zone
I’m naturally a minimalist. I don’t like wasting things and I am NOT a stylish person. So I just don’t spend a lot of money. Interestingly, I sometimes push myself to spend more. I don’t want my life to become small and stunted because I’m trying to save a few pennies. So I try to think about what really matters to me and spend on that. For me, that’s travel. So I make a point to travel, but I also figure out what does and doesn’t matter to me about travel. Fancy restaurants? Not so much. I hit the grocery stores and have myself a picnic on the grass. But yeah, I’ll spend a bit more on a larger AirBNB so my three kids don’t drive me crazy in a tiny studio. (Trust me, it works out better for all of us that way.)
On the other hand, I LOVE side hustles. I have owned rental real estate, worked on the side as a real estate agent, run a blog, taught private language classes, and created an online class. My advice here is to find something you enjoy doing anyway, and then maximize your income from it. Do you love dogs? How about doing dog walks in the summer or even pet sitting for owners who are out of town? Maybe you are into reading. How about doing indexing on the side? And if you are open for some teaching after you step out of your classroom, you can make awesome money teaching private group classes. (Click the links if you want to know more details.)
Like anything in personal finance, it comes down not just to knowing the facts and the numbers, but to knowing yourself. So if you are a spender, try one little way to cut expenses. No one is asking you to go all out. Or if your know deep down that you really need to increase your income, start trying on side hustles to find one you enjoy so much you’d do it for free. Because neither team ‘spend less’ nor team ‘dream big’ can win this game alone.
