Factor financial health into your school’s wellbeing plans

Simon Rake, Head of Education at the Wesleyan Group

The pandemic has been tough on everyone, but teachers have had more than most to deal with.

Heavier workloads and extra responsibilities have brought increased stress, putting ever more demands on their physical and mental health. But every school is a community, and we know that headteachers have stepped up to support their colleagues during this difficult time.

Indeed, one enduring outcome from the crisis has been an increased focus on teachers’ wellbeing. After all, happy, healthy staff make for positive learning environments and better outcomes for children.

We know that many schools now have effective wellbeing programmes in place to support staff with any issues that are causing stress. But amid all of the pressures teachers face, one area that can be overlooked is finances.

Financial health is critical to overall wellbeing, and ensuring that staff have the support and advice they need to remain on top of their money is key. 

At Wesleyan, our financial advisers are currently delivering free seminars in schools to help ensure teachers’ financial plans are on track. 

Here are three focus areas our advisers are discussing with educators – and some areas where they could help your staff too. 

Budgeting and saving

Teachers work hard for their money, so they want to make the most of it.

At the same time, there’s a peace of mind that comes with having money in the bank, just in case.

Lockdown gave many of us the opportunity to cut back on our spending and save more than usual; Wesleyan’s own research found that the average Brit saved £276 a month during the coronavirus pandemic, compared with £240 before.

It’s great to get into the habit of saving more, but it’s important to have a strategy for your cash.

Thinking about what you are saving for and your personal circumstances will help you work out the best way to manage your money, including setting savings goals. 

But we’d always suggest building up a rainy day fund before you start saving for a home, car or holiday.

A good rule of thumb is to have three months net household income in the bank in case of unforeseen expenses.

You can then think about saving towards your goals or investing for the future. 

Investing

At a time when interest rates are at record lows and inflation is rising, many of us will be looking for ways to make our money work harder.

Inflation can eat away at the spending power of a pound – effectively, for every percentage point inflation rises, a pound buys a little bit less.  

One way of overcoming this is to invest. Holding stocks and shares instead of cash means a stronger chance of keeping value, or achieving real-term growth, where money grows at a rate faster than inflation. 

Teachers don’t need a huge amount of money to start investing – any amount will do.  

One option could be to open a stocks and shares ISA, which offers the added benefit that no capital gains tax or income tax is charged on any investment profits.

The Wesleyan stocks and shares ISA lets teachers invest in our flagship With Profits ISA Fund. While all investments are subject to the ups and downs of the stock market, the With Profits ISA Fund works to reduce sharp rises and falls through a process called smoothing – holding back some profits when the market performs well, to subsidise returns in years when the market falls and ultimately reducing day-to-day fluctuations in your investment.

Thinking to the future

Whether retirement is years away, or just around the corner, it’s always a good time to dedicate time to reviewing, refreshing or developing retirement plans. 

Thinking about when you’d like to retire and what you’d like your lifestyle to be like will help you work out how much income you will need and how big your pension pot needs to be. 

Professional advice from a financial consultant can help develop the right strategy, which should also consider the implications of choices like taking a phased retirement or a career break.  

Teachers’ pension arrangements can be disrupted if they take time out to have and raise children or care for a relative.

While members of the Teachers’ Pension Scheme (TPS) can take statutory maternity leave of up to a year, statutory maternity pay only covers 39 weeks, leaving three months where teachers who take a full year’s leave receive no pensionable income. 

Mitigating this impact could mean making additional pension arrangements beyond the TPS, which a professional, independent adviser will be able to help plan for. 

At Wesleyan, we understand the unique financial needs of teachers and how feeling financially secure can support their overall wellbeing.

Our consultants are ready to share their experience to help you and your colleagues get your finances on track, so you can focus on supporting your students.

To arrange free seminars for your staff with one of Wesleyan’s specialists, please visit our website.