Educator on FIOR Interview 27: Kate (Middle School Teacher)

The Educator on FIOR (Financial Independence Optional Retirement) series is about sharing different perspectives, approaches, and challenges of educators working to improve their finances. This series proves you can build wealth while doing work that matters.

Today, I’m thrilled to feature Kate from Financial Independence for Teachers. Learn how she and her husband are raising 4 kids and building net worth of over a million dollars. 

Tell us about you.

Hi! I’m Kate! I’m a middle school Spanish Teacher and momma to four young kids ages 10, 8, 6, and almost 2. This is my sixteenth year teaching and I’m still enjoying my work. I’m lucky to work in a fabulous school district that compensates its teachers well. I’m blessed to work with outstanding colleagues who come to work tirelessly each day and make a difference in the lives of their students. I’ve been married to my Civil Engineer husband, Jeff, for the last eleven years and together we are on the path to financial independence while living an incredible life right now! 

What do you like most about working in education?

I really love the energy that kids bring to my life. The middle school/junior high age group of kids are just starting out in the world and are looking for mentors and role models. While they often act “all grown up” they’re still willing to play my silly games and excited to learn something new like a second language. 

What do you like least?

Education has changed a lot over the last fifteen years. There is just so much accountability nowadays that it can make teachers fearful to do what they know their students need and what is right, which can lead to a lot of self-doubt. We pour our whole selves into this profession, so when someone has something negative to say about how we are doing our jobs, it can be a big hit to our self-confidence. 

What is your Why of Financial Independence?

I’ve been a “dumb girl” about my finances for way too long. While I am lucky to have had an amazing dad who always talked to my brother and I about money management and the importance of living below your means, being a full time teacher and mother made it difficult to take the time to ask questions and to learn about how my husband has been managing our money over the past decade. I’m glad to finally be taking the time to become more financially literate. 

Together as a couple we want to make sure we have a security net in case something terrible should happen and we need money to pay the bills. As parents we want the best for our children and we know that money brings with it a lot of power. We want to be able to help our children when they need us and to be able to retire at a young enough age that we can explore the world and help with our grandchildren without having to worry about how we will find the time to do the things that we want to do when we are older. 

Are you:

1. FI Curious – Just learning and becoming interested in financial independence
2. Future FI – On the path, but still learning. Destined for financial independence!
3. FI Success – Financially independent!

We are definitely Future FI. We have a combined net worth of approximately 1,000,000 if you count our house that we are on track to pay off before summer, our over 100 acres of property just down the road from our house, our children’s college savings plans, and our individual retirement savings. While it would be amazing to retire right now, at ages 38 and 40 we still enjoy our jobs and feel like we are making a positive difference in the world. We plan to keep accumulating as much wealth and as many great memories as possible while we are still working. 

Share any financial numbers you are comfortable sharing.

I work in an incredible school district in Pennsylvania that values professional development. Our teachers are able to earn approximately $2,500 more per each 15 credits they take beyond the Masters level up until a Masters + 60 credit hours. Because I reached the top of this salary ladder by age 37, I will have at least 18 years where I am making about $10,000 more than most of my colleagues just by taking classes. This money has helped us to come to peace with paying more for daycare and will allow me to retire about two years earlier than my colleagues. While I don’t feel comfortable sharing my exact income, it is very reasonable for me to believe that within the next few years I will be making six figures. 

Meanwhile, my husband works for a governmentally operated engineering company. For the longest time his wages were stagnated, but they are finally back on track. The sacrifices he made to work in a lower paying (but more secure) job will pay off when it’s time for him to retire since he will also retire with a great pension. While we are both forced to pay out approximately 10% each per year in order to help define our pension funds, this money as well as the money we have been contributing to our own individual retirement funds should allow us to retire financially secure by age 55 or 56. 

Tell us about your path to FI.

1. What are your successes/wins?
2. What are your challenges?

Because we have a larger than normal family with four young children, paying for daycare has definitely been our greatest challenge. While some of the FIRE and early retirement bloggers out there have children, most of them have family members who have either been able to provide them with childcare for cheap or free. Don’t get me wrong, having four children was our decision, and one of the best decisions of our lives. I’m not complaining, I’m just trying to explain that while the general cost of raising children doesn’t have to be a lot, paying for childcare for many people is their only option and this is definitely a topic that needs to be added to the financial independence conversation. 

A secondary challenge that we have had is just finding the time to do what needs to be done at home on top of working two full time jobs. 

At many points in my life I have really struggled with finding balance, especially after returning to work six weeks after having three of our four babies. I can honestly understand why so many mothers are suffering from anxiety and depression. As a society, we just expect women to jump right back into work without realizing that giving birth and taking care of a baby is a full time job in and of itself. 

One of my main goals in early retirement is to help new mothers in any way possible. From my research in education, I know that early literacy is probably the best way to help ensure children are successful in the future, so being able to educate women on what they can do to organize, and manage their homes and routines and ways to support them in educating their children would be things that I feel I could provide based on my own personal experiences.

What is your long-term goal? Do you have a FI target? 

Our long term goal is to retire by age 55 or 56. We will have to take a 6- 9% penalty to retire this early, but by increasing our total annual salary and saving money in our own individual retirement accounts we should be able to make up for this money on our own to retire on our terms. 

Before retiring I have many other goals. I’d like to work as a principal for a while and quite possibly as a professor. While it is stressful to be a teacher today, I love teaching and working with kids and people who want to improve education. I’m only planning to “retire” once and so I want to make the most of my career legacy while still teaching. 

If you become financially independent will you:

1. Retire early?
2. Continue to work in education? (How/why?)
3. Do something different?

We are planning to retire by ages 55 or 56, but that’s still pretty far away. A teacher friend of mine is planning to retire earlier but to have enough money in cash to wait to withdraw from her pension until she is 55 years old. I have to do more research on this approach, but if it is possible to wait to withdraw from your retirement pension or accounts, we might be interested in exploring this option. When I hear the word “retire” I don’t think of someone having to work a second job. I think of someone who is living off of their passive income. I do feel that there are some people who confuse these words. In my mind, there is a definite difference between a “career break” and “retirement”. 

Tell us about a short-term goal you’re working towards. 

Aside from helping our children to pay for their college, we also want to be able to give back more to our community. We live in a very poor community and there is so much that we could do with additional funding. This is part of the reason why we aren’t in a huge rush to retire early. Once we begin drawing from our assets we recognize that our income will become very fixed. We want to still be able to donate to organizations in need within our community, and by working we can continue to help others monetarily without worrying if this will cause us to run out of money too soon. 

Who/what inspires you?

I’m inspired by so many things and people! God inspires me daily, my children and how quickly they are growing- especially our nearly two year old baby girl, and my parents inspire me with their own incredible financial independence story. I’m definitely a “glass half full” type of girl and I hope that by being positive and enthusiastic about life my optimism will inspire others. 

What’s something you want to say to other educators about financial independence?

While the FIRE movement has provided some great discussions and helped people to plan for their financial future, it doesn’t have to be an all or nothing sort of movement. I personally love the idea of taking well planned career breaks. 

I had the opportunity to take two seven month sabbaticals from teaching to work on my principal certification, but also to be there for my babies. During this time we traveled together as a family, spent time with out-of-town extended family members and friends, I started a photography company, trained for and ran a half-marathon, and just had a chance to decompress from the stress of working full time and raising a family. Because we weren’t paying for daycare during this time, it made complete sense for me to be home! 

It’s so important to read your contract and to ask questions. I would have never had these incredible opportunities if I hadn’t read my teaching contract and talked to others who had taken sabbaticals and asked questions. Taking a career break has allowed me to return to teaching ready to go for another seven years. I’m already considering my next sabbatical from work three years from now and if this is something available in your contract, I would encourage you to take advantage of this incredible opportunity too! 

Is there anything you’d like to get feedback from the community?

Yes, there are two things. First, I’d like to know how to find a financial advisor who understands the unique needs of teachers. I don’t want to pay a ton of money to someone who doesn’t understand our unique situation. 

Second, I’d like to find out more about the potential to defer my retirement benefits and to live off a cash reserve until the minimum retirement age of 55 here in Pennsylvania. I’m especially wondering if leaving work early without withdrawing from my retirement accounts will result in another penalty (on top of the 3% penalty per year for those leaving before age 58). 

Where can readers reach you if they want to connect?

I’ve just started blogging and I’m hooked! While my blogs are still very new, I’d love for you to read more about our family’s story. I am definitely not someone who you would expect to start a blog. My technological skills are limited and I’m not selling anything. I’m just a girl who’s learned a lot over the past 16 years of working full time and raising a family. I’d love for you to stop on by to visit my sites at Financial Independence for Teachers and Sabbatical From Work. Don’t forget to say hi! 

Thank you Kate, for naming the expenses of childcare as a real challenge many teachers face. I continue to be inspired by how the educators in this series name the challenges they face while continuing to move forward with smart intentional choices. 

While I’m the type of person who goes all out when pursuing goals like financial independence, Kate makes an important point about other ways to approach it. The sabbaticals are an important part of her journey. Find whatever balance you need to make sure you can persist until the end!

Since my goal this year is overcoming my cynicism, I really appreciate Kate’s optimistic approach to life.

Don’t forget to drop by and check out her sites. (Wow, working, four kids, and two sites – I’m impressed.)

Finally, you can find the other stories of Educators on FIOR here.