At this time of year, trainee teachers are amid job applications and interviews. It is a stressful time, wondering if you will ever get that first step on the ladder. It becomes a race to July, and any thought of why you are doing this has long evaporated.
There are two key reasons why trainee teachers are looking for work. First, it is for the love of the job and a desire to fulfil an ambition. Second, it is so they can be paid and earn a living.
On this second point, teachers are philosophical about the fact that they won’t be rolling in money at the start of their career. In fact, most newly qualified teachers struggle to get by each month. However, what is forgotten in this review of salary is the contribution your pension benefits make to your level of remuneration.
Celebrating the additional benefits
As a teacher, you will automatically be enrolled into the Teachers’ Pension Scheme by your new employer. While a proportion of your salary is paid into this scheme, your employer will also pay contributions for you too. The contributions the employer makes to your pension is a crucial part of your remuneration package, as you are rewarded for the work you do now.
It is easy only to look at your net income when considering whether you are well paid. However, it is fair to say that the Teachers’ Pension Scheme is one of the more generous pensions available and can offer benefits later in life.
What are the benefits of the Teachers’ Pension Scheme?
First and foremost, the Teachers’ Pension Scheme will provide an income in retirement, which can help you to continue living in a lifestyle you enjoyed while working. It is possible to take part of your pension as a lump sum, which could pay off your mortgage or fund that travel you always desired.
Your pension is taken from your pay before tax. Therefore, it is a great way to save for your future. It is likely in the future that you will want to add more money to your pension, to make the most of these long-term savings’ benefits.
The pension monies are always yours. If you should die in service, the pension becomes part of your estate. A lump sum may be paid to your relatives and a dependents or spouse pension could be payable. Therefore, the whole time you are paying into your pension, you are accruing a fund that your loved ones’ benefit from.
Add your pension to your rewards
It is often overlooked how the Teachers’ Pension Scheme adds to the rewards that teachers receive. Public workers who offer so much in a vocational profession are seen by some as superheroes, but there is a little more on offer than people sometimes recognise, so if you would like to learn how to take advantage of these benefits, you might want to speak to an independent financial advisor.
The content in this article was correct on 19th April 2021. You should not rely on this article to make important financial decisions. Teachers Financial Planning offers advice on pensions for teachers and non-teachers. Please use the contact form below to arrange an informal chat with an advisor and see how we can help you.