Five Personal Finance Tips from the Teacher's Desk

Teachers are uniquely qualified to give financial advice for several reasons. Teachers must budget carefully to plan for summer months of unemployment. Teachers are dependent on public mileage opinion for a paycheck. Here are personal finance tips from a teacher. I've been a Michigan certified K-8, CI and CE teacher for 20+ years. I've worked in public and private school settings. I've also homeschooled my children. This advice is culled from years of frugal living and financial prudence.

Plan ahead

I cannot stress this basic tip enough. Save a portion of your income. Buy CDs (not compact disks, Certificates of Deposit). CDs offer a much higher interest rate on savings, because once purchased, they can only be cashed in during certain small windows of time. Do the math on employer sponsored savings programs. Take advantage of IRA or 401K programs if the interest rates are higher than those available privately. You should always have saved enough income to last six months in case of emergency.

Insurance

Explore all employee paid insurance package options. Choose the package that best suits your needs, but make sure your package does not actually cost you more overall. Calculate to see if you can save money by investing money saved on health care premiums, co-pays and deductibles. Sometimes, budgeting your monthly health care costs is less expensive than participating in your employer's health care program. This is especially true for employer sponsored prescription and vision programs. Many pharmacies offer $4 per month ($10 per three month) prescriptions which far more cost effective than employer prescription programs. All out-of-pocket health care expenses are tax-deductible, too.

Credit cards

Open credit cards to take advantage of discounts and special financing rates, but pay off the balance monthly. Credit cards help establish a credit rating and are useful when traveling. Do not carry a balance on your credit card. Pay your monthly balance on time to avoid late fees. Pay your balance only 2-3 days before the due date. This will ensure that the payment arrives on time, in case the date falls on a holiday or weekend.

Vehicle purchases

Buy used vehicles to avoid depreciation loss. Only buy second hand vehicles through private sales if you know what you're doing or have a trusted, knowledgeable person to help you. Explore special brand used vehicle purchasing interest rates, trade-in opportunities and delayed interest and financing rates.

General Purchases

Compare prices and value when buying other items new vs. secondhand. When buying high dollar furniture items, look for older items of better quality, rather than new, poor quality furniture. Buy new or reconditioned digital and electronic items; avoid used digital products. Look for gently used appliances but proceed with caution. It is possible to save money buying used appliances, but I recommend purchasing new appliances to take advantage of warranties and service plans. I have saved hundreds of dollars by purchasing extended warranties and service agreements on appliances. I purchase appliances through local trusted dealers rather than large warehouse retailers. Customer service and repair service calls are far superior to warehouse programs.