Calling all fellow teachers!
You know as well as I do if anyone can get the most for their money its teachers (maybe because we’re paid so little!).
Teachers are the masters of making the most out of what they have, be it ideas, resources, or money. In fact, we might better be coined magicians because half of what we do seems to come out of thin air!
But the secret to our work isn’t magic, its copious amounts of time, energy, collaboration, passion, and love for what we do. We all know at the end of the day seeing an idea ignite in the mind of a child is the real magic, and we sacrifice a lot to get it.
Because of the time and money we invest in our students, our contracts simply do not do us justice. Teachers are woefully underpaid for what they do, and we know it. But did you know there is a lot more to your teaching contract than prep time, caseload, and salary?
Do you realize you can have both big Money Saved and big Money Earned from your teaching contract!?
If you know where to look, and pay attention to the finer details, you’re teaching contract can benefit you a lot more than you may think. Let’s take a look at 3 ways your teaching contract can benefit you that you may not have realized.
1. Continuing Education
Most teachers rarely take advantage of the continuing education benefit in their contracts (most of my teacher friends don’t anyway!).
Here’s how it works.
Every district has a salary schedule for their teachers, which is essentially a table showing how much you will make per year based on your experience and education. Keep in mind that each district will be different depending on location (rural/urban, state, etc.), but it will probably look something like this one from my district.
The table is pretty straight forward. On the left side you have a level based on your years of teaching experience (0 years of experience for a first year teacher and so on), and across the top is another set of levels based on your education.
The left side is the easiest to understand. Basically, you will have a small raise in salary every year you teach up until year 13, when you have 12 years of experience. At that time, you will cap out your salary increases based on experience level. You don’t need to worry about this side, as you’ll max out based on experience if you teach long enough.
The part you really need to pay attention to are the education levels, as this is the area you can control with the help of your contract. Again, every district will have a different salary schedule and steps, but the concept should generally be the same.
For my district, the lowest level of education is a Bachelor’s degree, but as you can see your salary increases with each 15 graduate credits acquired. In Oregon, you are required to complete a certified teacher preparation program culminating in a Bachelor’s degree or higher.
I did a Master’s plus licensure program (because I already had a Bachelor’s), where you can get the license and begin work after two years then finish the Master’s later. Typically, if you want the Master’s you are required to finish the Master’s portion within a certain number of years.
In my case, I had to finish the Master’s anyway, so why not get it as soon as possible and make more money longer?
I finished my Master’s (requiring another year of coursework and a Master’s thesis in addition to the two years of teacher prep courses I did to get the license) my first year as a teacher, which gave me a HUGE bump in salary.
The salary schedule was different when I first started, but based on the example table above the addition of a Master’s degree in my second year would have bumped my salary from $42,118 to $51,936 a year.
That’s an increase of $9,818!
I don’t know many other jobs where you can get a 23% bonus in salary in one year.
But the raises don’t stop there.
As you can see in the table, your salary continues to rise based on education level until you reach a Master’s plus 45 credits (or BA + 105). In my district, you can gain even more in salary if you obtain a Doctoral degree or if you are National Board Certified. You could potentially cap out in salary at $87,646!
Now, here’s where your teaching contract kicks in.
Most districts will offer some sort of assistance for continuing education once you’re hired full-time (you may have to work for a certain period of time before gaining access to this benefit). While the specifics may differ, the profits of taking advantage of this benefit do not.
In my case, my district will reimburse the costs of continuing education up to 6 credits a year. This means if I pay up front for the cost of tuition (usually reduced for continuing education classes), my district will reimburse the full cost of 6 credits per fiscal year.
This means my district will pay for me to make more money!
Not only does this benefit help you gain those all-important PDU’s for licensure (which you will need anyway), you’ll make more money faster for doing the same job. I know many of you are busy, but 2 classes a year is a relatively small amount of time to invest for such a big yield. Plus, continuing education classes are generally not that difficult (they are designed for busy working teachers).
Let’s look at an example.
Based on the salary schedule for my district, let’s look at how much more money you would make in salary by increasing your education by 6 credits a year (the amount the district will reimburse you for) versus if you just stayed at a Bachelor’s.
Look at the difference! If you increased your educational level by 6 credits a year until you cap out based on years of experience (12) you will be paid $80,401 more over the course of those years for doing the same job!
ALL FOR FREE!
Another way of looking at it is if you don’t take advantage of continuing education benefits you could be leaving at least $80,401 on the table!
Don’t forget, this chart only goes to year 13 and 72 credits. My district will pay you more for up to 105 credits past a Bachelor’s, so you can continue to make even more money without a dime out of your pocket.
And if you’re really ambitious, you could make even more by paying out of pocket for credits beyond 6 a year. I would recommend this route if you’re financially able, because you can still get the money back.
If you’re patient, my district will reimburse you for courses taken in the past, meaning I can take courses now (and increase my salary) and get reimbursed for them years from now! (Example: I could take 18 credits this year, get reimbursed for 6 of them, then save my receipts for the remaining 6 credits for next year and another 6 the year after that!).
If you don’t want to wait, you can also choose to write off any out of pocket tuition costs in your taxes, which will save you in itemized deductions.
No matter how you choose to structure your coursework, getting paid to increase your salary is one of the best (and most overlooked) benefits of your teaching contract.
2. Travel Funds
This lesser known benefit of your teaching contract is much more fun than taking coursework, but still just as useful to your professional development.
As with continuing education, most districts will offer some sort of travel fund to attend conferences or other types of professional development. In my district, these are called Professional Development Funds, and teachers are allotted up to $1,500 over a 3-year period.
These funds can be used to cover the registration costs of conferences, workshops, seminars, and site visits. They can also be used for travel costs associated with the professional development opportunity if it is outside a 25-mile radius of Portland (check with your district for your specific parameters).
This means you could attend a conference across the country and have your airfare, hotel, car, and meals paid for up to $1,500!
I personally took advantage of this benefit when I attended a conference in Atlanta. The cost of the conference registration was covered, along with my airfare, hotel, car rental, and most of my meals. I had a great time exploring the city, attending a Braves game, and I gained a bunch of knowledge that I can apply to my teaching practice, as well as valuable PDU’s for licensure!
Utilizing travel funds is the perfect opportunity to get a free (or greatly reduced-cost) vacation. Plus, bring your significant other, kids, or a friend and have an even better time!
3. Differed Compensation
The last major hidden benefit to your teaching contract is the ability to set up a differed compensation account. More traditionally known as the 403(b) supplemental retirement plan, these accounts allow you to put away a portion of your monthly check that will then grow over the course of your career and be available to you upon retirement (hence differed compensation).
Essentially, a 403(b) plan is like a second retirement account that is in addition to your employer-sponsored retirement and allows more of your money to work for you.
While I won’t go into detail about the different types of accounts offered here, I will give you a brief overview of how it works.
A 403(b) plan is different than your employer-sponsored retirement account in that it is managed by an approved vendor of your choice. Depending on your location and district, the list of vendors may be different. However, the process is generally the same. You will make an appointment with an approved vendor, decide what type of account you want (Traditional or Roth IRA), and how much you would like to contribute each month (how much will come out of your check).
You will also need to decide the risk associated with your investment. Many people choose to invest in higher-risk investments when they are younger and low-risk investments as they near retirement age (check with your financial investor to decide what is best for you).
No matter the options you choose, investing in a 403(b) plan is a great way to utilize compound interest to make your money work for you and to give you an extra cushion in your retirement years.
Moral of the Story
Teachers don’t make enough money, period.
However, your teaching contract offers a plethora of benefits that can result in both Money Saved and Money Earned if you know where to look. Taking advantage of continuing education funds, travel funds, and differed compensation accounts can help you earn more money for longer and gain valuable PDU’s for licensure, all paid for by your district!
Teaching isn’t looking so bad after all.
Talk about Money Saved!
Tawnya is an elementary special education teacher by day and blogger at Money Saved is Money Earned by night.
She holds an Honors BS in Psychology from Oregon State University and an MS in Special Education from Portland State University. She has had a pretty successful writing career, first as a writing tutor at the Oregon State University Writing Center, and in recent years, as a freelance writer.
Tawnya has a wealth of knowledge and information about personal finance, retirement, student loans, credit cards, and many other financial topics. She teaches people how to save money, make money, and understand money.