Teachers Who Have Net Worth of $1 million +

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Mickey7
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Re: Teachers Who Have Net Worth of $1 million +

Post by Mickey7 » Sat Aug 18, 2018 5:16 pm

I do not believe that you could, or should, value your potential pension payment over a period of 20 or 30 years and use it to claim a net worth for that figure. A pension is an income stream for your retirement. This has been addressed in many of our threads.

Jablean
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Re: Teachers Who Have Net Worth of $1 million +

Post by Jablean » Sat Aug 18, 2018 5:27 pm

chipperd wrote:
Sat Aug 18, 2018 5:13 pm
Jablean wrote:
Thu Aug 16, 2018 7:19 pm
Teachers wages haven't kept up with other wages, at least in most states, so what a teacher could do then and what a teacher can do now are apples and oranges.
A million bucks is a million bucks regardless of wages or inflation
Not the point, the question is how much of that have they been able to keep and invest. Teachers in our state start around $32,000 and top out around $55,000. Most of that money is now spent on food and housing so saving as a percentage of income is way down from what they could have done in the past.

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MNGopher
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Location: Minnesota

Re: Teachers Who Have Net Worth of $1 million +

Post by MNGopher » Sat Aug 18, 2018 6:10 pm

Mickey7 wrote:
Sat Aug 18, 2018 5:16 pm
I do not believe that you could, or should, value your potential pension payment over a period of 20 or 30 years and use it to claim a net worth for that figure. A pension is an income stream for your retirement. This has been addressed in many of our threads.
I agree and don't count any future pension benefit in my net worth calculations. I do count the surrender value of my pension. This is the amount, that if I quit today, I could get as a lump sum. In Minnesota this amount is your total personal contributions (not employers contribution) plus I think 2% interest (simple/not compounded). I think too many teachers rely too much that their pension will always be there for them, and therefor neglect personal saving.

If I were to quit today my surrender value of my state pension would only be about $170,000 lump sum after slightly more than 28 years in the profession. On the other hand if I work four more years, to age 57, I can get about $50-55K with a small COLA for the rest of my life. If I live to my actuarial life expectancy that should be worth close to 1.5 million. That's a good amount but I try to save as if it is an uncertainty.














4

SuzBanyan
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Re: Teachers Who Have Net Worth of $1 million +

Post by SuzBanyan » Sat Aug 18, 2018 6:42 pm

My parents have a net-worth in excess of $1M. My Dad taught high school, then became a district wide administrator. My Mom taught — at various times - kindergarten, Head Start pre-school, adult school (parent participation pre-school) and junior college. My Dad also worked a second job for 20 years through the air national guard.

They weren’t good savers while I was growing up, but they put 3 kids through college and helped us buy our first homes.

My mother and her brother each received a $300k inheritance from my grandmother. My grandmother was a teacher and was a good saver. She was forced to go into teaching when she was widowed with two toddlers. She never re-married and had to fight for a pension from the Army Corp of Engineers after her husband was killed in a collapse of a dam he was building. The death benefit was $100 per month, a lot in 1937, not as much in 2010 when she passed.

Other than the inheritance, my parents net worth is from owning real estate. They have lived in the same home in the Bay Area since 1972. They also own a rental home and a vacation home. They each have a pension through CalPers and receive benefits and a pension from my Dad’s military retirement. With no kids to support, my parents are now saving regularly and helping their grandkids with college expenses.

seligsoj
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Re: Teachers Who Have Net Worth of $1 million +

Post by seligsoj » Sat Aug 18, 2018 7:42 pm

I have posted a number of times on this forum about teacher finances. My husband and I reached the million mark at 40. He is a librarian and I am a school psychologist. The trick is to avoid school loan debts, live in an area that compensates teachers well where the cost of living is still doable, invest early, and LBYM. I invest like my pension will only partially be there for me when I retire. Even though my school district pays well, many of the educators I know don't invest and spend what they make.

RetiredMommy
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Re: Teachers Who Have Net Worth of $1 million +

Post by RetiredMommy » Sat Aug 18, 2018 9:51 pm

I started teaching in 1998-99 right out of college and have 17 years in Cal STRS. My highest salary was 102k with full family medical/dental in 2012-13 in a high cost of living SoCal community. I’ve always saved as much as possible into my 403b, most years maxing it out and saving additional.

We have over a million in accounts currently at mid-40s, not taking into account house, pensions or anything else. Our accounts are split and mine, after 17 years of teaching, have about 700k just with my contributions as a teacher!

I think teachers need to save like any other job and it can be done. Unfortunately, too many teachers think the pension is the answer but it’s not for any younger person. Paying off debt, being smart about big purchases, and saving, saving, saving are a must. Another MUST for teachers is getting to the far right column of the pay scale (Masters degree, etc. to maximize earnings) asap but that can be done inexpensively. It also helps to have a spouse that makes decent money and/or shares your philosophy of saving.

anonenigma
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Re: Teachers Who Have Net Worth of $1 million +

Post by anonenigma » Sun Aug 19, 2018 2:11 am

If they can afford it, teachers are unique in being able to contribute to both a 403(b) and a 457(b) - an annual maximum of $37,000 up to age 50 and $49,000 after age 50. This only makes sense, though, if the plans are low-cost and offer good investment options - unfortunately, rarely the case. Plus an annual contribution to an IRA.

Norsky19
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Re: Teachers Who Have Net Worth of $1 million +

Post by Norsky19 » Sun Aug 19, 2018 5:01 am

According to my Mint acct: 2,400,000 Net worth.

Teaching overseas for the last 25 years and taking advantage of the foreign income tax exclusion and maxing out every account possible. Indexing and taxable accounts on top of it all. :)

ponyboy
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Re: Teachers Who Have Net Worth of $1 million +

Post by ponyboy » Sun Aug 19, 2018 5:01 am

Where I live...east bumble PA...teachers at a not so great school district max out at around $75k. Thats LOT of money for the area. Not to mention when a teacher retires with full benefits...they receive around $70k/year pension for life. Yeah...most shouldnt have an issue becoming millionaires.

I cant think of too many part time jobs where you can make this much. Yeah...I know teachers hate to hear they only work part time...but its true. Im not hating...actually quite jealous that they have summers off, xmas break off (week or two), all major holidays, etc etc.

Goinganontoday
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Re: Teachers Who Have Net Worth of $1 million +

Post by Goinganontoday » Sun Aug 19, 2018 7:38 am

ponyboy wrote:
Sun Aug 19, 2018 5:01 am
Where I live...east bumble PA...teachers at a not so great school district max out at around $75k. Thats LOT of money for the area. Not to mention when a teacher retires with full benefits...they receive around $70k/year pension for life. Yeah...most shouldnt have an issue becoming millionaires.

I cant think of too many part time jobs where you can make this much. Yeah...I know teachers hate to hear they only work part time...but its true. Im not hating...actually quite jealous that they have summers off, xmas break off (week or two), all major holidays, etc etc.
I’m a teacher and agree with you. Granted, there are some schools/districts that require certain amounts of work (professional development, etc.), over the summer and many teachers need to do a fair amount of work to be prepared for the next school year, but overall, I’ve found those hours do not equate to a full time job over the summer.

My DH and I are on track to have more than $1 million by retirement, not even including my pension or the lifetime healthcare that goes with it. We live below our means, keep to a budget, and save as though I did not have a pension.

I know some very financially savvy teachers, but they tend to be few and far between. Most teachers I know went into teaching straight out of college and never bothered to learn anything about saving because they believed that the pension would be sufficient. Those that try to learn about investing have been faced with the slimeball 403b salespeople who sell the unknowledgeable young teachers on annuities with a guaranteed 2% growth every year without mentioning that their fees more than take that growth away (I seriously know multiple teachers on this plan...). I’ve tried talking some teachers out of these horrific 403b “deals,” but it’s been so ingrained in them that the salespeople are working to help them that the teachers have a hard time actually seeing the scam for what it is. Not to mention how pushy the salespeople become when the teachers try to end their relationship with them.

I’ve also noticed that a good number of teachers do things against their own financial interests. For example, when school districts offer teachers the option to be paid over ten months or twelve months, many teachers choose to be paid over twelve months. Even when it’s explained to the teachers that being paid over ten months gets the money in their pocket faster and they could budget for twelve months out of those pay checks, they still go with the twelve month option. I’ve been told outright by teachers that “it’s easier” and “it keeps (the teacher) from overspending and ending up broke during those two months with no paycheck.” Instead of making a budget and sticking to it and earning interest (or using the money to pay off high interest credit card debt), they let the district hold on to their money and get the interest off it. I will never understand that mentality.

So, yes, most teachers have the ability to have $1 million or more at retirement, but for several reasons, many teachers do not and believe that there is something special about those rare teachers who do.

trumpet83
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Re: Teachers Who Have Net Worth of $1 million +

Post by trumpet83 » Sun Aug 19, 2018 8:06 am

I'm a teacher, but not retired. I started in 2006 and I'm still under the 80% of average of top 3 years wages pension agreement. When I calculate net worth I don't try to calculate the value of that future pension, but it should count for something. That's roughly 10% of my wages that go toward saving for the future that I can't use to fund my 403b/457b. I think pension value would be more more net worth relevant than including the value of your house, especially if you don't plan on downsizing. Yes, the percentage could change so you should always be saving and pretending it might not be there, but the odds are it will be there in some form.

I know some really well-off retired teachers, but I would say that the biggest disadvantage current educators have is that as a whole we seem to be very under-educated about investing. Possibly as soon as someone hears the word "pension" they just turn off and figure "it's covered". All the companies that come into the staff lounge, put out "free" donuts and set people up with 403b accounts with 1% account fees per year. Nobody knows any different.

Beyond the pension issue, I know I'm in the minority but I think we get paid pretty well. You start out pretty low, but hang in there and the pay gets pretty decent. Figure in the fact that we are off for about 3 months of the year and I believe we've got a pretty good thing going. Every job gives you a whole list of circumstances. Pay is just one of them. Some make incredible wages, but give up in other areas. Someone else mentioned that they didn't really think it was so notable for teachers to be millionaires and I kind of agree in a way. The only thing that holds them back is being under-educated/interested in finances, perhaps because of the crutch called a pension that, when fulfilled, leaves most of them pretty ok anyway.

bikechuck
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Re: Teachers Who Have Net Worth of $1 million +

Post by bikechuck » Sun Aug 19, 2018 8:39 am

indexonlyplease wrote:
Sat Aug 18, 2018 11:32 am
It is the politicians that destroy government not the employees. When you have any liabilities pensions, SS, medicare ect.) you must fund the liabilities. Some states, cities have decided not to fund for years. Then they wonder why the pension system is in such bad shape. It is about money management which politicians have no idea about.

States and cities can adjust the pension system but not destroy what was promised to their employees because they mismanaged the tax payers money.
I agree that the politicians that are at fault however I do have mixed feelings about the benefit plans for teachers, civil servants, politicians, military, firefighters, police and others that I as a taxpayer help to subsidize.

Why is it that I am taxed to help to pay for these generous retirement plans but when I ask that social security and medicare be shored up or when I ask that I have some help in paying for a medicare supplement plan I am told that we can't have that because it is socialism?

I also think that people should get the benefits that they were promised and that they were counting on when they chose their careers so as I said I do have mixed feelings about this.

masonstone
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Re: Teachers Who Have Net Worth of $1 million +

Post by masonstone » Sun Aug 19, 2018 9:35 am

Grt2bOutdoors wrote:
Sat Aug 18, 2018 2:39 pm
masonstone wrote:
Sat Aug 18, 2018 12:55 pm
Gardner's Son wrote:
Thu Aug 16, 2018 12:01 pm
As a retired teacher, I'm interested in hearing from my fellow Life-Giving Educators who were able to devote their lives to teaching, invest over time, may have started side businesses, and have amassed over $1 million net.
    How did you do it?
      Perhaps share your net worth as a testament to other younger educators that teaching and having high net worth is possible.
        Thanks!
        1 million dollars net worth isn’t the same as what it was a couple of decades ago. You almost need at least 7 figures to have a comfortable retirement.
        Love these posts. What is the difference between 1 million dollars and 7 figures? Zero, they are worth exactly the same.

        Now, they are worth the same too, however the value provided may be different or not. In any event, if you can save up that amount or some amount that permits you to live, that’s good enough.
        I was using the two as synonyms.

        pennywise
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        Re: Teachers Who Have Net Worth of $1 million +

        Post by pennywise » Sun Aug 19, 2018 10:10 am

        stoptothink wrote:
        Sat Aug 18, 2018 11:43 am

        I agree with you. I made no judgement nor said it was in any way the problem of the public employees that these pension plans are unsustainable. But it is what it is, public employee pensions are a huge boon on the finances of countless municipalities today and there isn't much that can be done to fix them at this point.
        [I think you mean drain, not boon]

        Not only teachers, but many public service/government retirees' pension commitments are simply unsustainable at current levels. Here's another illustrative tale:

        My BIL is a retired civil engineer who interned then worked at the same local municipality for his entire 40+ year career. His salary was quite decent for a civil employee and I recall when he was ~50 YO him telling us at a family dinner one night that he had now gotten to the point at which his pension benefit would equal his annual income, and indeed would surpass it eventually since it had a COLA included. In Florida public service employees also have a great perk to their employment; the Deferred Retirement Option Program (DROP) allows someone in the state retirement system to declare a retirement date up to 5 years in advance, at which point the state begins crediting the employee's annual pension benefit as if s/he had already retired, while the employee continues to work for full salary and benefits. At the end of (up to 5 years) DROP when the employee retires there is a lump sum payout of the pension income which has been accruing, after which the employee then begins to receive a full pension.

        So, my brother in law set up DROP at around 50 YO, and 'retired' at 55 YO when he had accrued 35 years of service (recall he started as an intern). He got his lump sum payout, literally retired Friday and returned to the office on Monday morning as a contractor, which also entailed a higher salary than his final pay scale. He was a contract employee for another 10 years so he had annual income+pension+investment gains from DROP payout. He finally quit work to embark on actual retirement a year ago and is certainly financially more than comfortable.

        Told the previous long story to illustrate that it is a difficult issue--the people who are drawing these enviable pension benefits didn't set out to game the system, at least not in a nefarious fashion. They simply were fortunate to come up in a system that generously rewarded them, and now the moral question becomes how to balance promises that were made to loyal employees with the reality that local, state and perhaps even federal government can no longer afford to keep paying out the committed sums of money.

        Institutionally of course life is already changing and as has been noted, many/most civil service retirement plans are no longer nearly as generous. Still, the reverberations of the 'accounts payable' to my BIL, the teachers, the policemen etc are going to be around for a long, long time.

        tibbitts
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        Re: Teachers Who Have Net Worth of $1 million +

        Post by tibbitts » Sun Aug 19, 2018 10:32 am

        Jablean wrote:
        Sat Aug 18, 2018 5:27 pm
        chipperd wrote:
        Sat Aug 18, 2018 5:13 pm
        Jablean wrote:
        Thu Aug 16, 2018 7:19 pm
        Teachers wages haven't kept up with other wages, at least in most states, so what a teacher could do then and what a teacher can do now are apples and oranges.
        A million bucks is a million bucks regardless of wages or inflation
        Not the point, the question is how much of that have they been able to keep and invest. Teachers in our state start around $32,000 and top out around $55,000. Most of that money is now spent on food and housing so saving as a percentage of income is way down from what they could have done in the past.
        True, but stagnant nominal wages have been not unique to education over the past decade or longer now, so lots of people effectively now earn 10-20% less in real terms. Given everything else being equal it's not really possible to maintain savings rates under those conditions.

        indexonlyplease
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        Re: Teachers Who Have Net Worth of $1 million +

        Post by indexonlyplease » Sun Aug 19, 2018 10:33 am

        bikechuck wrote:
        Sun Aug 19, 2018 8:39 am
        indexonlyplease wrote:
        Sat Aug 18, 2018 11:32 am
        It is the politicians that destroy government not the employees. When you have any liabilities pensions, SS, medicare ect.) you must fund the liabilities. Some states, cities have decided not to fund for years. Then they wonder why the pension system is in such bad shape. It is about money management which politicians have no idea about.

        States and cities can adjust the pension system but not destroy what was promised to their employees because they mismanaged the tax payers money.
        I agree that the politicians that are at fault however I do have mixed feelings about the benefit plans for teachers, civil servants, politicians, military, firefighters, police and others that I as a taxpayer help to subsidize.

        Why is it that I am taxed to help to pay for these generous retirement plans but when I ask that social security and medicare be shored up or when I ask that I have some help in paying for a medicare supplement plan I am told that we can't have that because it is socialism?

        I also think that people should get the benefits that they were promised and that they were counting on when they chose their careers so as I said I do have mixed feelings about this.
        I agree and as I said before, it is ok to change any government plan being SS, medicare, pensions ect. But not because the plan was not funded for years like Illinois because the local government decided to use the money some place else. And yes there are some cities and states that have promised unrealistic plans help themselves and get votes. Look at California the next disaster.

        Cheryl604
        Posts: 131
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        Re: Teachers Who Have Net Worth of $1 million +

        Post by Cheryl604 » Sun Aug 19, 2018 11:03 am

        I am a teacher, retirement accounts around 500k, hope to be to 2mil by retirement, currently aged 36. Here's how I've done it:

        Access to two retirement accounts: 403b and 457b, which are both maxed each year.
        Max the Roth IRA.
        Max the HSA.

        Having a spouse/partner: someone said wealthy spouse, and I disagree. Just having a spouse that makes about the same, but has same investing/frugality principles is enough. Marry rich is great if it works out, but you can also marry with shared financial values and do well enough. But actually having a partner to split and share expenses is very important to saving. It's a lot harder to pay for everything on your own.

        No kids. Active choice, expense of kids definitely a major factor.

        Also, I am paying 6% of salary into pension and will get 30-40% of final annual salary depending on age at retirement.

        Teachers have historically been preyed upon by financial institutions, and many of my peers subscribe to the mindset that they "can't" manage their own money and are quite willing to pay the fees levied on them. I think that this is a major factor that has reduced the wealth and net worth of my fellow teachers.

        Determined
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        Re: Teachers Who Have Net Worth of $1 million +

        Post by Determined » Sun Aug 19, 2018 12:18 pm

        trumpet83 wrote:
        Sun Aug 19, 2018 8:06 am
        I know some really well-off retired teachers, but I would say that the biggest disadvantage current educators have is that as a whole we seem to be very under-educated about investing. Possibly as soon as someone hears the word "pension" they just turn off and figure "it's covered". All the companies that come into the staff lounge, put out "free" donuts and set people up with 403b accounts with 1% account fees per year. Nobody knows any different.

        Someone else mentioned that they didn't really think it was so notable for teachers to be millionaires and I kind of agree in a way. The only thing that holds them back is being under-educated/interested in finances, perhaps because of the crutch called a pension that, when fulfilled, leaves most of them pretty ok anyway.
        Yes to all of this! We are trying really hard in my district to educate teachers better, especially the younger ones. It's an uphill battle even as we have watched retirement age go up and final average salary pension percentage go down.

        tibbitts
        Posts: 9370
        Joined: Tue Feb 27, 2007 6:50 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by tibbitts » Sun Aug 19, 2018 12:28 pm

        indexonlyplease wrote:
        Sun Aug 19, 2018 10:33 am
        bikechuck wrote:
        Sun Aug 19, 2018 8:39 am
        indexonlyplease wrote:
        Sat Aug 18, 2018 11:32 am
        It is the politicians that destroy government not the employees. When you have any liabilities pensions, SS, medicare ect.) you must fund the liabilities. Some states, cities have decided not to fund for years. Then they wonder why the pension system is in such bad shape. It is about money management which politicians have no idea about.

        States and cities can adjust the pension system but not destroy what was promised to their employees because they mismanaged the tax payers money.
        I agree that the politicians that are at fault however I do have mixed feelings about the benefit plans for teachers, civil servants, politicians, military, firefighters, police and others that I as a taxpayer help to subsidize.

        Why is it that I am taxed to help to pay for these generous retirement plans but when I ask that social security and medicare be shored up or when I ask that I have some help in paying for a medicare supplement plan I am told that we can't have that because it is socialism?

        I also think that people should get the benefits that they were promised and that they were counting on when they chose their careers so as I said I do have mixed feelings about this.
        I agree and as I said before, it is ok to change any government plan being SS, medicare, pensions ect. But not because the plan was not funded for years like Illinois because the local government decided to use the money some place else. And yes there are some cities and states that have promised unrealistic plans help themselves and get votes. Look at California the next disaster.
        I think we're getting into prohibited subjects here, but nobody would change a government plan if it wasn't "not funded for years." That's the whole point of changing the plans. The fact that SS is in trouble partly because the federal government decided to use the money elsewhere doesn't make me feel better than if a state/local government had done the same.

        bradshaw1965
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        Joined: Tue Jul 31, 2007 9:36 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by bradshaw1965 » Sun Aug 19, 2018 2:11 pm

        tibbitts wrote:
        Sat Aug 18, 2018 3:10 pm
        I don't agree that, averaged over the entire country, it's necessarily a huge accomplishment to accumulate $1M as a teacher vs. countless other occupations with similar requirements. Also we have all kinds of posts referring to couples, and there again if both people work, I'm not seeing it as a huge accomplishment. In fact my purely anecdotal observation/guess is that it's more likely for two - or often more - people in a family to be employed at the same school as is the case for other businesses, and there may be some structural characteristic that contributes to this.
        So maybe this isn't the thread for you, there are lots of threads about how folks can't retire on 3-5 Million, maybe the original poster was looking for some grass roots encouragement.

        bradshaw1965
        Posts: 760
        Joined: Tue Jul 31, 2007 9:36 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by bradshaw1965 » Sun Aug 19, 2018 2:59 pm

        I've found this calculator really useful for getting a feel for actual net worth and what it means to be a millionaire in the United States.

        https://dqydj.com/net-worth-by-age-calc ... ed-states/

        Make sure you switch to avoid home equity and it's 90th percentile for 50-54 and 85th percentile for 60-64. There are a lot of fellow Boglehead's who should be feeling really good with a sense of accomplishment shooting for that number, even including home equity you should be thinking you are doing pretty well and maybe you'll get some tips to really nail a nice comfortable retirement.

        User avatar
        cockersx3
        Posts: 241
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        Re: Teachers Who Have Net Worth of $1 million +

        Post by cockersx3 » Sun Aug 19, 2018 3:28 pm

        Goinganontoday wrote:
        Sun Aug 19, 2018 7:38 am
        ponyboy wrote:
        Sun Aug 19, 2018 5:01 am
        Where I live...east bumble PA...teachers at a not so great school district max out at around $75k. Thats LOT of money for the area. Not to mention when a teacher retires with full benefits...they receive around $70k/year pension for life. Yeah...most shouldnt have an issue becoming millionaires.

        I cant think of too many part time jobs where you can make this much. Yeah...I know teachers hate to hear they only work part time...but its true. Im not hating...actually quite jealous that they have summers off, xmas break off (week or two), all major holidays, etc etc.
        I’m a teacher and agree with you. Granted, there are some schools/districts that require certain amounts of work (professional development, etc.), over the summer and many teachers need to do a fair amount of work to be prepared for the next school year, but overall, I’ve found those hours do not equate to a full time job over the summer.

        My DH and I are on track to have more than $1 million by retirement, not even including my pension or the lifetime healthcare that goes with it. We live below our means, keep to a budget, and save as though I did not have a pension.

        I know some very financially savvy teachers, but they tend to be few and far between. Most teachers I know went into teaching straight out of college and never bothered to learn anything about saving because they believed that the pension would be sufficient. Those that try to learn about investing have been faced with the slimeball 403b salespeople who sell the unknowledgeable young teachers on annuities with a guaranteed 2% growth every year without mentioning that their fees more than take that growth away (I seriously know multiple teachers on this plan...). I’ve tried talking some teachers out of these horrific 403b “deals,” but it’s been so ingrained in them that the salespeople are working to help them that the teachers have a hard time actually seeing the scam for what it is. Not to mention how pushy the salespeople become when the teachers try to end their relationship with them.

        I’ve also noticed that a good number of teachers do things against their own financial interests. For example, when school districts offer teachers the option to be paid over ten months or twelve months, many teachers choose to be paid over twelve months. Even when it’s explained to the teachers that being paid over ten months gets the money in their pocket faster and they could budget for twelve months out of those pay checks, they still go with the twelve month option. I’ve been told outright by teachers that “it’s easier” and “it keeps (the teacher) from overspending and ending up broke during those two months with no paycheck.” Instead of making a budget and sticking to it and earning interest (or using the money to pay off high interest credit card debt), they let the district hold on to their money and get the interest off it. I will never understand that mentality.

        So, yes, most teachers have the ability to have $1 million or more at retirement, but for several reasons, many teachers do not and believe that there is something special about those rare teachers who do.
        Just had to reiterate the point about teachers often not making decisions that are in their own best financial interests. My wife (who is a teacher) unfortunately also routinely sees the 403b salesmen in the teachers lounge, selling overpriced products to people who generally are not paying attention. My wife's district actually has a great Fidelity 403b program, but they don't have salesmen....you have to call and set it up yourself. Not that hard, but it does require you to do some homework yourself. But even though she is all set on this, the salespeople still keep pestering her to "help." She finally got them to back down by telling them that her husband was a financial advisor himself...not true, but it worked. Most of her co-workers either do not have a retirement savings plan set up, or they have one set up through Voya or some other one for which I can't remember the name now.

        Ditto with my wife's 457 program. They do not advertise this much, but they have a good program through Nationwide that has low(ish) fees and Vanguard funds. We max out both contributions, which has earned my wife some puzzled calls from the district office....

        Seriously thinking about giving a talk at her school about investing basics. Just painful to watch people do things that are financially harmful.... :oops:

        tibbitts
        Posts: 9370
        Joined: Tue Feb 27, 2007 6:50 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by tibbitts » Sun Aug 19, 2018 4:03 pm

        bradshaw1965 wrote:
        Sun Aug 19, 2018 2:11 pm
        tibbitts wrote:
        Sat Aug 18, 2018 3:10 pm
        I don't agree that, averaged over the entire country, it's necessarily a huge accomplishment to accumulate $1M as a teacher vs. countless other occupations with similar requirements. Also we have all kinds of posts referring to couples, and there again if both people work, I'm not seeing it as a huge accomplishment. In fact my purely anecdotal observation/guess is that it's more likely for two - or often more - people in a family to be employed at the same school as is the case for other businesses, and there may be some structural characteristic that contributes to this.
        So maybe this isn't the thread for you, there are lots of threads about how folks can't retire on 3-5 Million, maybe the original poster was looking for some grass roots encouragement.
        The clear implication of the original post is that it should be more difficult to retire with $1M as a teacher vs. occupations with similar entry requirements, and I'm questioning that. I'm also suggesting the $1M would represent a more important component of retirement income for someone with an occupation that was less likely to provide a pension.

        Having said that, retiring with $1M for anyone is certainly an accomplishment. Adjusted for inflation, my parents had accumulated less than $1M in 2018 dollars of net worth by the time my father was 60 and had to retire for health reasons. He had no pension. He was a surgeon, and they were fairly frugal overall. So I guess I could start a thread for surgeons who manage to retire with $1M or more, so they can have some grass-root encouragement too.

        With teacher pay there is considerable geographic variation, and it might be twice as difficult for teachers in some locations to retire with a $1M net worth vs. other locations. Of course $1M also goes farther in some locations than in others.

        bradshaw1965
        Posts: 760
        Joined: Tue Jul 31, 2007 9:36 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by bradshaw1965 » Sun Aug 19, 2018 4:50 pm

        tibbitts wrote:
        Sun Aug 19, 2018 4:03 pm
        bradshaw1965 wrote:
        Sun Aug 19, 2018 2:11 pm
        tibbitts wrote:
        Sat Aug 18, 2018 3:10 pm
        I don't agree that, averaged over the entire country, it's necessarily a huge accomplishment to accumulate $1M as a teacher vs. countless other occupations with similar requirements. Also we have all kinds of posts referring to couples, and there again if both people work, I'm not seeing it as a huge accomplishment. In fact my purely anecdotal observation/guess is that it's more likely for two - or often more - people in a family to be employed at the same school as is the case for other businesses, and there may be some structural characteristic that contributes to this.
        So maybe this isn't the thread for you, there are lots of threads about how folks can't retire on 3-5 Million, maybe the original poster was looking for some grass roots encouragement.
        The clear implication of the original post is that it should be more difficult to retire with $1M as a teacher vs. occupations with similar entry requirements, and I'm questioning that. I'm also suggesting the $1M would represent a more important component of retirement income for someone with an occupation that was less likely to provide a pension.

        Having said that, retiring with $1M for anyone is certainly an accomplishment. Adjusted for inflation, my parents had accumulated less than $1M in 2018 dollars of net worth by the time my father was 60 and had to retire for health reasons. He had no pension. He was a surgeon, and they were fairly frugal overall. So I guess I could start a thread for surgeons who manage to retire with $1M or more, so they can have some grass-root encouragement too.

        With teacher pay there is considerable geographic variation, and it might be twice as difficult for teachers in some locations to retire with a $1M net worth vs. other locations. Of course $1M also goes farther in some locations than in others.
        All reasonable. I just don't want Bogleheads to be a place that only the absolute winners in life feel comfortable. These principles really work and can really upgrade peoples financial lives all over the spectrum of careers.

        Topic Author
        Gardner's Son
        Posts: 21
        Joined: Mon Jun 11, 2018 8:43 am

        Re: Teachers Who Have Net Worth of $1 million +

        Post by Gardner's Son » Sun Aug 19, 2018 7:07 pm

        As the OP, I'd like to thank everyone for sharing their "The Millionaire Teacher Next Door" stories.

        inbox788
        Posts: 6647
        Joined: Thu Mar 15, 2012 5:24 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by inbox788 » Sun Aug 19, 2018 7:43 pm

        MNGopher wrote:
        Sat Aug 18, 2018 6:10 pm
        Mickey7 wrote:
        Sat Aug 18, 2018 5:16 pm
        I do not believe that you could, or should, value your potential pension payment over a period of 20 or 30 years and use it to claim a net worth for that figure. A pension is an income stream for your retirement. This has been addressed in many of our threads.
        I agree and don't count any future pension benefit in my net worth calculations. I do count the surrender value of my pension. This is the amount, that if I quit today, I could get as a lump sum. In Minnesota this amount is your total personal contributions (not employers contribution) plus I think 2% interest (simple/not compounded). I think too many teachers rely too much that their pension will always be there for them, and therefor neglect personal saving.

        If I were to quit today my surrender value of my state pension would only be about $170,000 lump sum after slightly more than 28 years in the profession. On the other hand if I work four more years, to age 57, I can get about $50-55K with a small COLA for the rest of my life. If I live to my actuarial life expectancy that should be worth close to 1.5 million. That's a good amount but I try to save as if it is an uncertainty.
        Some folks live longer or shorter than their actuarial life expectancy. Those that live longer will effectively have > 1.5M pension value. I don't have statistics, but I suspect/expect that a high percentage of those that are less than 5 years away from less than $250k cash out value vs. 1.5M pension equivalent will stick it out those five or fewer extra years. The incentive is quite high if you do the expected math (1.5M - 250k)/5 years = more than $250k/year. I hope those running the pensions have not been and aren't now using the surrender values as their costs/liabilities.

        User avatar
        JMacDonald
        Posts: 2256
        Joined: Mon Feb 19, 2007 5:53 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by JMacDonald » Sun Aug 19, 2018 8:20 pm

        inbox788 wrote:
        Sun Aug 19, 2018 7:43 pm
        MNGopher wrote:
        Sat Aug 18, 2018 6:10 pm
        Mickey7 wrote:
        Sat Aug 18, 2018 5:16 pm
        I do not believe that you could, or should, value your potential pension payment over a period of 20 or 30 years and use it to claim a net worth for that figure. A pension is an income stream for your retirement. This has been addressed in many of our threads.
        I agree and don't count any future pension benefit in my net worth calculations. I do count the surrender value of my pension. This is the amount, that if I quit today, I could get as a lump sum. In Minnesota this amount is your total personal contributions (not employers contribution) plus I think 2% interest (simple/not compounded). I think too many teachers rely too much that their pension will always be there for them, and therefor neglect personal saving.

        If I were to quit today my surrender value of my state pension would only be about $170,000 lump sum after slightly more than 28 years in the profession. On the other hand if I work four more years, to age 57, I can get about $50-55K with a small COLA for the rest of my life. If I live to my actuarial life expectancy that should be worth close to 1.5 million. That's a good amount but I try to save as if it is an uncertainty.
        Some folks live longer or shorter than their actuarial life expectancy. Those that live longer will effectively have > 1.5M pension value. I don't have statistics, but I suspect/expect that a high percentage of those that are less than 5 years away from less than $250k cash out value vs. 1.5M pension equivalent will stick it out those five or fewer extra years. The incentive is quite high if you do the expected math (1.5M - 250k)/5 years = more than $250k/year. I hope those running the pensions have not been and aren't now using the surrender values as their costs/liabilities.
        Several years ago I asked CalSTRS what percentage of retired teachers had benefits:
        I was told that in 2002 the Office of the Actuary, found the following results: 75.7% have been retired five + years; 53% have been retired for 10+ years; 33.8% have been retired for 15+ years; 18.4% have been retired for 20+ years

        I fund it interesting that only 18.4% have been retired for 20+ years. It gave me pause to enjoy my retirement while I am around to enjoy it.
        Last edited by JMacDonald on Sun Aug 19, 2018 8:21 pm, edited 2 times in total.
        Best Wishes, | Joe

        User avatar
        marbleous
        Posts: 189
        Joined: Mon Oct 22, 2007 8:37 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by marbleous » Sun Aug 19, 2018 8:20 pm

        For reference our local district pays between 36-80k for salary depending on education and time served.

        Employees pay about 1/3 of health insurance.

        The state pension formula is: Average (top 5) Annual Compensation X 1.1% [0.011] X Years of Service

        Which works out to be about 20-30K per year depending on career length.

        It is a solid living wage, but hard to turn into multi-millions.

        Most teachers, I find, do not go into the profession for the pay or benefits. Most could be making a lot more in the private sector.

        tibbitts
        Posts: 9370
        Joined: Tue Feb 27, 2007 6:50 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by tibbitts » Sun Aug 19, 2018 10:08 pm

        marbleous wrote:
        Sun Aug 19, 2018 8:20 pm
        For reference our local district pays between 36-80k for salary depending on education and time served.

        Employees pay about 1/3 of health insurance.

        The state pension formula is: Average (top 5) Annual Compensation X 1.1% [0.011] X Years of Service

        Which works out to be about 20-30K per year depending on career length.

        It is a solid living wage, but hard to turn into multi-millions.

        Most teachers, I find, do not go into the profession for the pay or benefits. Most could be making a lot more in the private sector.
        That seems like an unusually annual multiplier - 1.1%. Had it been higher previously? Is this a low cost of living area?

        anonenigma
        Posts: 736
        Joined: Thu Apr 21, 2011 11:58 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by anonenigma » Sun Aug 19, 2018 11:55 pm

        tibbitts wrote:
        Sun Aug 19, 2018 10:08 pm
        marbleous wrote:
        Sun Aug 19, 2018 8:20 pm
        For reference our local district pays between 36-80k for salary depending on education and time served.

        Employees pay about 1/3 of health insurance.

        The state pension formula is: Average (top 5) Annual Compensation X 1.1% [0.011] X Years of Service

        Which works out to be about 20-30K per year depending on career length.

        It is a solid living wage, but hard to turn into multi-millions.

        Most teachers, I find, do not go into the profession for the pay or benefits. Most could be making a lot more in the private sector.
        That seems like an unusually annual multiplier - 1.1%. Had it been higher previously? Is this a low cost of living area?
        Formula is different in California: It's years of service x age factor x average salary but...

        Age factor is 1.4% at age 55 for employees hired before 2013, 2.0% at age 60, 2.4% at age 63 (or 61.5 with 30 years).
        Average salary is over 3 highest years for employees hired before 2013 if they have less than 25 years in, single highest year if they have 25 or more years in.

        inbox788
        Posts: 6647
        Joined: Thu Mar 15, 2012 5:24 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by inbox788 » Mon Aug 20, 2018 1:46 am

        JMacDonald wrote:
        Sun Aug 19, 2018 8:20 pm
        Several years ago I asked CalSTRS what percentage of retired teachers had benefits:
        I was told that in 2002 the Office of the Actuary, found the following results: 75.7% have been retired five + years; 53% have been retired for 10+ years; 33.8% have been retired for 15+ years; 18.4% have been retired for 20+ years

        I fund it interesting that only 18.4% have been retired for 20+ years. It gave me pause to enjoy my retirement while I am around to enjoy it.
        Interesting statistic, but I wondered about what it compared to. At first, I thought it had to do with longevity, but that's not all that clear to me now. I'm not sure the denominator is common or comparable. With population growth, the number of teachers has also grown; does this impact the percentage? What causes the diminishing number with age? Are cash outs part of it? And do some accounts get tapped out?

        Or is it simply a relationship with age? And 2002 (minus 20 years) would likely be inbetween 1965 and 2015 figures in this graph:

        http://www.hamiltonproject.org/charts/p ... x_and_year

        If you ask the same question today, the numbers should be a bit higher and even more in 20+ years.

        chipperd
        Posts: 481
        Joined: Sat Sep 24, 2011 5:58 am

        Re: Teachers Who Have Net Worth of $1 million +

        Post by chipperd » Mon Aug 20, 2018 5:07 am

        Jablean wrote:
        Sat Aug 18, 2018 5:27 pm
        chipperd wrote:
        Sat Aug 18, 2018 5:13 pm
        Jablean wrote:
        Thu Aug 16, 2018 7:19 pm
        Teachers wages haven't kept up with other wages, at least in most states, so what a teacher could do then and what a teacher can do now are apples and oranges.
        A million bucks is a million bucks regardless of wages or inflation
        Not the point, the question is how much of that have they been able to keep and invest. Teachers in our state start around $32,000 and top out around $55,000. Most of that money is now spent on food and housing so saving as a percentage of income is way down from what they could have done in the past.
        Actually, it's the point of the post entitled "Teachers who have net worth of $1 million +". I understand your point, but I was responding to the OP's point.

        A440
        Posts: 456
        Joined: Mon Sep 02, 2013 7:46 am
        Location: NJ

        Re: Teachers Who Have Net Worth of $1 million +

        Post by A440 » Mon Aug 20, 2018 6:00 am

        Here is the pension formula for NJ teachers from the State's website: As of now, there are NO COLAs for any TPAF pensions, also, the mandatory yearly contribution is 7.5% of the teacher's salary
        Tier 1, 2, 3: Enrolled before July 2007
        Years of service/55 x average of final salary= Max Pension (no survivor)
        Example: 30 years/55 x 90,000= $49,090 year (before taxes)

        Tier 4, 5: Enrolled after May 2010
        Years of service/60 x average of final salary= Max Pension (no survivor)

        There are also different age requirements ranging from 55-65 for retirement. Current teachers are required to contribute to their healthcare premium both before and after retirement. The sharing percent is based on your salary. Currently, I am paying 28% of my premium.

        Around 34 years of teaching, it actually costs more to go to work than not, because of all the deductions. However, many of my colleagues continue to do so because they LOVE IT.

        ---
        As for a reaching 1 million mark, here's how we did it with 1 earner, 2 kids and SAHM (worked/invested for 7 years before kids), no inheritances:
        -Start early and invest as much as you can before starting a family
        -Learn how to DIY improvements and repairs (YouTube, RepairClinic.com)
        -Get a side hustle
        -Tithe 10%, invest 20%, live on the rest.
        -Keep it simple
        -"Comparison is the thief of Joy" (Teddy Roosevelt)
        -"Be counter-cultural in a culture that's lost its mind" (Dave Ramsey)
        I don't know what the future holds, but I know who holds my future.

        beardsworth
        Posts: 2135
        Joined: Fri Jun 15, 2007 4:02 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by beardsworth » Mon Aug 20, 2018 7:24 am

        Gardner's Son wrote:
        Sun Aug 19, 2018 7:07 pm
        As the OP, I'd like to thank everyone for sharing their "The Millionaire Teacher Next Door" stories.
        Since many other posters here responded to your request by divulging details of their financial lives and discussions of how they reached their goals, is there any particular reason why, as a retired teacher, you haven't done the same, for the benefit of others reading this thread?

        jehovasfitness
        Posts: 553
        Joined: Mon Jan 22, 2018 2:26 pm

        Re: Teachers Who Have Net Worth of $1 million +

        Post by jehovasfitness » Mon Aug 20, 2018 7:49 am

        Jablean wrote:
        Thu Aug 16, 2018 7:19 pm
        Teachers wages haven't kept up with other wages, at least in most states, so what a teacher could do then and what a teacher can do now are apples and oranges.
        Yep, along with teacher these days have a ton in student loan debt

        User avatar
        CyclingDuo
        Posts: 2701
        Joined: Fri Jan 06, 2017 9:07 am

        Re: Teachers Who Have Net Worth of $1 million +

        Post by CyclingDuo » Mon Aug 20, 2018 8:31 am

        Gardner's Son wrote:
        Thu Aug 16, 2018 12:01 pm
        As a retired teacher, I'm interested in hearing from my fellow Life-Giving Educators who were able to devote their lives to teaching, invest over time, may have started side businesses, and have amassed over $1 million net.
          How did you do it?
            Perhaps share your net worth as a testament to other younger educators that teaching and having high net worth is possible.
              Thanks!
              There is a good thread here that had a lot of data and discussion on Educators that had hit the millionaire status:

              viewtopic.php?f=2&t=254081

              Should be right up the OP's The Millionaire Next Door teacher emphasis/quest! :beer

              The thread got the " This thread has run its course and is locked (derailed)." treatment, but has a lot of good information within it with regard to teachers and accumulating wealth.

              The best way to look at the division of wealth accumulation for educators is through a traditional three legged stool.

              Leg one of the stool: pension
              Leg two of the stool: Social Security
              Leg three of the stool: withdrawals from the risk portfolio (stocks/bonds - usually via the 403b/457b/tIRA/Roth IRA/HSA/taxable account savings)

              Not every educator will have all three legs. For example, not all states have teachers contributing to Social Security, so they won't receive any. For those educators, the other legs will become more important and the savings in both will need to make-up what the loss of the lost leg would have provided.

              However, if we go with the OP's post - it is the third leg we would be measuring for the $1M mark and can be attained through most any career using BH principles of living below one's means, saving a regular percentage of one's salary in a well chosen asset allocation, working a full career to leverage the power of time and compounding.

              CyclingDuo#2EducatorIncomeHousehold
              "Everywhere is within walking distance if you have the time." ~ Steven Wright

              4th and Inches
              Posts: 213
              Joined: Mon Nov 12, 2012 8:53 pm

              Re: Teachers Who Have Net Worth of $1 million +

              Post by 4th and Inches » Mon Aug 20, 2018 8:42 am

              Interesting stuff. Thanks for sharing everybody. I'm not a teacher and have a ways to go.

              genefl
              Posts: 35
              Joined: Wed Feb 05, 2014 10:32 am

              Re: Teachers Who Have Net Worth of $1 million +

              Post by genefl » Mon Aug 20, 2018 8:48 am

              My parents are both teachers. They retired in their late 50's. Both are frugal and they have always lived well below their means. (I continually encourage them to spend more, but this falls on deaf ears!)

              They have a multi-million dollar portfolio with stocks and rentals. They had side hustles back before it became popular to do so. He has dabbled in individual stocks for as long as I can remember but the majority of his stock portfolio is in mutual funds. Their main side hustle is real estate. My father got his realtor license and ultimately a broker's license. To my very financially conservative mother's chagrin, my father bought a rental house whenever he could. We all put sweat equity into the rentals growing up. My parents paid for 1 private, 1 public university education and 1 medical school education. Their sacrifices have paid off in their children's lives and we carry on the financial lessons that we learned growing up. I remember a classmate making fun of me because my parents worked all of the time. Well.... :)

              I think that teachers are underpaid and underappreciated for what they do for our kids. However, by living below your means, maxing out retirement plans, investing and maybe taking risk in a side hustle, a financially healthy retirement is possible!

              student
              Posts: 4141
              Joined: Fri Apr 03, 2015 6:58 am

              Re: Teachers Who Have Net Worth of $1 million +

              Post by student » Mon Aug 20, 2018 9:20 am

              CyclingDuo wrote:
              Mon Aug 20, 2018 8:31 am
              Gardner's Son wrote:
              Thu Aug 16, 2018 12:01 pm
              As a retired teacher, I'm interested in hearing from my fellow Life-Giving Educators who were able to devote their lives to teaching, invest over time, may have started side businesses, and have amassed over $1 million net.
                How did you do it?
                  Perhaps share your net worth as a testament to other younger educators that teaching and having high net worth is possible.
                    Thanks!
                    There is a good thread here that had a lot of data and discussion on Educators that had hit the millionaire status:

                    viewtopic.php?f=2&t=254081

                    Should be right up the OP's The Millionaire Next Door teacher emphasis/quest! :beer
                    In the thread that you have linked in the above post, you said that you have received a job offer. Did you take it?

                    dknightd
                    Posts: 1869
                    Joined: Wed Mar 07, 2018 11:57 am

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by dknightd » Mon Aug 20, 2018 10:31 am

                    Somebody famous here said there are many roads to Rome.
                    Or something like that.
                    Choose your path.
                    The path you take might be different now than is it was 10, 20, 30, or 60, years ago.
                    Times change, life goes on, until you die.

                    Ron Ronnerson
                    Posts: 1353
                    Joined: Sat Oct 26, 2013 6:53 pm
                    Location: Bay Area

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by Ron Ronnerson » Mon Aug 20, 2018 12:58 pm

                    inbox788 wrote:
                    Mon Aug 20, 2018 1:46 am
                    JMacDonald wrote:
                    Sun Aug 19, 2018 8:20 pm
                    Several years ago I asked CalSTRS what percentage of retired teachers had benefits:
                    I was told that in 2002 the Office of the Actuary, found the following results: 75.7% have been retired five + years; 53% have been retired for 10+ years; 33.8% have been retired for 15+ years; 18.4% have been retired for 20+ years

                    I fund it interesting that only 18.4% have been retired for 20+ years. It gave me pause to enjoy my retirement while I am around to enjoy it.
                    Interesting statistic, but I wondered about what it compared to. At first, I thought it had to do with longevity, but that's not all that clear to me now. I'm not sure the denominator is common or comparable. With population growth, the number of teachers has also grown; does this impact the percentage? What causes the diminishing number with age? Are cash outs part of it? And do some accounts get tapped out?

                    Or is it simply a relationship with age? And 2002 (minus 20 years) would likely be inbetween 1965 and 2015 figures in this graph:

                    http://www.hamiltonproject.org/charts/p ... x_and_year

                    If you ask the same question today, the numbers should be a bit higher and even more in 20+ years.
                    I'll add another piece of info that I've heard to the mix. I attended a CalSTRS retirement workshop a few years back. The guy giving the presentation said that CalSTRS had looked at actuarial data and found that the average retiree lives to around age 88. College-educated women (which largely make up retired teachers) tend to live longer than the population at large. The nice climate in California and receiving a pension probably don't hurt in giving people even more incentive to keep on living.

                    anonenigma
                    Posts: 736
                    Joined: Thu Apr 21, 2011 11:58 pm

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by anonenigma » Mon Aug 20, 2018 1:02 pm

                    inbox788 wrote:
                    Mon Aug 20, 2018 1:46 am
                    JMacDonald wrote:
                    Sun Aug 19, 2018 8:20 pm
                    Several years ago I asked CalSTRS what percentage of retired teachers had benefits:
                    I was told that in 2002 the Office of the Actuary, found the following results: 75.7% have been retired five + years; 53% have been retired for 10+ years; 33.8% have been retired for 15+ years; 18.4% have been retired for 20+ years

                    I fund it interesting that only 18.4% have been retired for 20+ years. It gave me pause to enjoy my retirement while I am around to enjoy it.
                    Interesting statistic, but I wondered about what it compared to. At first, I thought it had to do with longevity, but that's not all that clear to me now. I'm not sure the denominator is common or comparable. With population growth, the number of teachers has also grown; does this impact the percentage? What causes the diminishing number with age? Are cash outs part of it? And do some accounts get tapped out?

                    Or is it simply a relationship with age? And 2002 (minus 20 years) would likely be inbetween 1965 and 2015 figures in this graph:

                    http://www.hamiltonproject.org/charts/p ... x_and_year

                    If you ask the same question today, the numbers should be a bit higher and even more in 20+ years.
                    I don't believe that CalSTRS permits cash outs after retirees begin to accept their annuity payments.

                    I remember hearing a few years back that California teachers, on average, lived 18 years into retirement. With an average retirement age of 62 point something, that takes them to 80 - maybe a little less than what one would expect from a college-educated population with more women than men. The teacher's life can be pretty grueling - lots of stress and not enough sleep.

                    anonenigma
                    Posts: 736
                    Joined: Thu Apr 21, 2011 11:58 pm

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by anonenigma » Mon Aug 20, 2018 1:05 pm

                    Ron Ronnerson wrote:
                    Mon Aug 20, 2018 12:58 pm
                    inbox788 wrote:
                    Mon Aug 20, 2018 1:46 am
                    JMacDonald wrote:
                    Sun Aug 19, 2018 8:20 pm
                    Several years ago I asked CalSTRS what percentage of retired teachers had benefits:
                    I was told that in 2002 the Office of the Actuary, found the following results: 75.7% have been retired five + years; 53% have been retired for 10+ years; 33.8% have been retired for 15+ years; 18.4% have been retired for 20+ years

                    I fund it interesting that only 18.4% have been retired for 20+ years. It gave me pause to enjoy my retirement while I am around to enjoy it.
                    Interesting statistic, but I wondered about what it compared to. At first, I thought it had to do with longevity, but that's not all that clear to me now. I'm not sure the denominator is common or comparable. With population growth, the number of teachers has also grown; does this impact the percentage? What causes the diminishing number with age? Are cash outs part of it? And do some accounts get tapped out?

                    Or is it simply a relationship with age? And 2002 (minus 20 years) would likely be inbetween 1965 and 2015 figures in this graph:

                    http://www.hamiltonproject.org/charts/p ... x_and_year

                    If you ask the same question today, the numbers should be a bit higher and even more in 20+ years.
                    I'll add another piece of info that I've heard to the mix. I attended a CalSTRS retirement workshop a few years back. The guy giving the presentation said that CalSTRS had looked at actuarial data and found that the average retiree lives to around age 88. College-educated women (which largely make up retired teachers) tend to live longer than the population at large. The nice climate in California and receiving a pension probably don't hurt in giving people even more incentive to keep on living.
                    I don't believe that's accurate - unfortunately.

                    bltn
                    Posts: 578
                    Joined: Mon Feb 20, 2017 9:32 pm

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by bltn » Mon Aug 20, 2018 1:12 pm

                    Slapshot wrote:
                    Sat Aug 18, 2018 2:26 pm
                    We're there and, even though we got some inherited money, we'd still be there without it. Good fortune and planning went into it. First, we bought our house in 1974, and it's now worth 10 times what we paid for it. Second, we always budgeted on my salary, so whatever my wife made as a secretary was saved. Later we used her pay to send our two kids to college with no borrowing. Third, I put a set amount into a 403b for years. It was taken out of my pay check, and I never missed it because I never saw it. My wife took maximum advantage of a 401k at her job. Vanguard index funds. Finally, we budgeted and lived below our means, never threw away money. But we always drove new cars and didn't feel we were missing out on anything. And last, we made some good investments, especially a rental condo which has appreciated by 50% over what we paid for it 5 years ago.

                    Other than our house and condo, we always paid cash for everything, never have had a credit card balance, and now have no debt whatsoever. We can pay all our bills with my pension income; my wife's social security is hers to spend as she wants. Our problem is trying to overcome our natural frugal instincts and spending money while we can enjoy it.
                    Great story!
                    Unfortunately I didn't t get this message until I hit 40. I needed some hard lessons in investing to get me on the right path.
                    I hope my kids will learn these lessons early. I m going to try my best to educate them to avoid my mistakes. Then they will have more room to make their own.
                    Congratulations.
                    Last edited by bltn on Mon Aug 20, 2018 2:24 pm, edited 2 times in total.

                    Ron Ronnerson
                    Posts: 1353
                    Joined: Sat Oct 26, 2013 6:53 pm
                    Location: Bay Area

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by Ron Ronnerson » Mon Aug 20, 2018 1:15 pm

                    anonenigma wrote:
                    Mon Aug 20, 2018 1:05 pm
                    Ron Ronnerson wrote:
                    Mon Aug 20, 2018 12:58 pm
                    inbox788 wrote:
                    Mon Aug 20, 2018 1:46 am
                    JMacDonald wrote:
                    Sun Aug 19, 2018 8:20 pm
                    Several years ago I asked CalSTRS what percentage of retired teachers had benefits:
                    I was told that in 2002 the Office of the Actuary, found the following results: 75.7% have been retired five + years; 53% have been retired for 10+ years; 33.8% have been retired for 15+ years; 18.4% have been retired for 20+ years

                    I fund it interesting that only 18.4% have been retired for 20+ years. It gave me pause to enjoy my retirement while I am around to enjoy it.
                    Interesting statistic, but I wondered about what it compared to. At first, I thought it had to do with longevity, but that's not all that clear to me now. I'm not sure the denominator is common or comparable. With population growth, the number of teachers has also grown; does this impact the percentage? What causes the diminishing number with age? Are cash outs part of it? And do some accounts get tapped out?

                    Or is it simply a relationship with age? And 2002 (minus 20 years) would likely be inbetween 1965 and 2015 figures in this graph:

                    http://www.hamiltonproject.org/charts/p ... x_and_year

                    If you ask the same question today, the numbers should be a bit higher and even more in 20+ years.
                    I'll add another piece of info that I've heard to the mix. I attended a CalSTRS retirement workshop a few years back. The guy giving the presentation said that CalSTRS had looked at actuarial data and found that the average retiree lives to around age 88. College-educated women (which largely make up retired teachers) tend to live longer than the population at large. The nice climate in California and receiving a pension probably don't hurt in giving people even more incentive to keep on living.
                    I don't believe that's accurate - unfortunately.
                    It's just what I heard from the CalSTRS presenter and I'm not sure exactly where he got his numbers. I would be surprised, though, if teachers had a lower life expectancy than the average person. That doesn't seem to make much sense.

                    Edit: I just did a google search and came across this link. Page 6 might be worth a look (section on Mortality after Retirement). https://www.calstrs.com/sites/main/file ... s_2015.pdf

                    audioaxes
                    Posts: 197
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                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by audioaxes » Mon Aug 20, 2018 1:38 pm

                    in my kids school district in SoCal teachers make over 100K along with what looks like 25K extra when working summer school. This is in a relatively low cost area compared to OC,LA, San Diego. Add in another spouse pulling in some decent income and it would not be hard to hit 1MM.

                    anonenigma
                    Posts: 736
                    Joined: Thu Apr 21, 2011 11:58 pm

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by anonenigma » Mon Aug 20, 2018 2:12 pm

                    Ron Ronnerson wrote:
                    Mon Aug 20, 2018 1:15 pm
                    anonenigma wrote:
                    Mon Aug 20, 2018 1:05 pm
                    Ron Ronnerson wrote:
                    Mon Aug 20, 2018 12:58 pm
                    inbox788 wrote:
                    Mon Aug 20, 2018 1:46 am
                    JMacDonald wrote:
                    Sun Aug 19, 2018 8:20 pm
                    Several years ago I asked CalSTRS what percentage of retired teachers had benefits:
                    I was told that in 2002 the Office of the Actuary, found the following results: 75.7% have been retired five + years; 53% have been retired for 10+ years; 33.8% have been retired for 15+ years; 18.4% have been retired for 20+ years

                    I fund it interesting that only 18.4% have been retired for 20+ years. It gave me pause to enjoy my retirement while I am around to enjoy it.
                    Interesting statistic, but I wondered about what it compared to. At first, I thought it had to do with longevity, but that's not all that clear to me now. I'm not sure the denominator is common or comparable. With population growth, the number of teachers has also grown; does this impact the percentage? What causes the diminishing number with age? Are cash outs part of it? And do some accounts get tapped out?

                    Or is it simply a relationship with age? And 2002 (minus 20 years) would likely be inbetween 1965 and 2015 figures in this graph:

                    http://www.hamiltonproject.org/charts/p ... x_and_year

                    If you ask the same question today, the numbers should be a bit higher and even more in 20+ years.
                    I'll add another piece of info that I've heard to the mix. I attended a CalSTRS retirement workshop a few years back. The guy giving the presentation said that CalSTRS had looked at actuarial data and found that the average retiree lives to around age 88. College-educated women (which largely make up retired teachers) tend to live longer than the population at large. The nice climate in California and receiving a pension probably don't hurt in giving people even more incentive to keep on living.
                    I don't believe that's accurate - unfortunately.
                    It's just what I heard from the CalSTRS presenter and I'm not sure exactly where he got his numbers. I would be surprised, though, if teachers had a lower life expectancy than the average person. That doesn't seem to make much sense.

                    Edit: I just did a google search and came across this link. Page 6 might be worth a look (section on Mortality after Retirement). https://www.calstrs.com/sites/main/file ... s_2015.pdf
                    It looks like that's a prospective actuarial change. People with college degrees live about four years longer than those without - presumably due to physical nature/dangers of occupation, access to healthcare, etc. As of a few years ago, California teachers on average lived 18 years after retirement.

                    sschullo
                    Posts: 2515
                    Joined: Sun Apr 01, 2007 8:25 am
                    Location: Rancho Mirage, CA
                    Contact:

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by sschullo » Mon Aug 20, 2018 8:29 pm

                    letsgobobby wrote:
                    Thu Aug 16, 2018 8:08 pm
                    Isn’t Boglehead and author sschullo a retired teacher?

                    https://latebloomerwealth.com/publicati ... lionaires/
                    Yep! Been retired for a decade. But I am still on my former employee's Los Angeles Unified retirement advisory committee.

                    But there were two of us and we achieved millionaire status when I was about 50 but then the tech bubble burst and lost most of it, but fought back, got our act together and still retired early at 61 for my generation. I think its remarkable because we lived in an expensive area of the country, Los Angeles CA. You can achieve millionaire status on a teachers salary because we have something that so many people don't: Pension benefits! In the last ten years, my benefits totaled about $475,000 but had to pay about $75,000 more or less in taxes. My portfolio is about 1.7M. Thinking back over my life, it is very easy to accumulate a millionaire dollars on a teacher's salary IF you are married, and both love to live frugally, save and invest and learn DIYer, no matter what, and people can live in New York, DC, or California. A single person would take more time, but teachers I have read somewhere are naturally frugal along with engineers.

                    Ed Mills is similar to an older "Mr. Money Mustache" lifestyle, who lives in very cheap areas of the country and just spent a year living in Mexico: Also a millionaire in his early 50s: http://www.millionaireeducator.com/net-worth
                    Last edited by sschullo on Tue Aug 21, 2018 7:40 am, edited 2 times in total.
                    Public School K-12 Educators: "Ask NOT what your annuity sales person can do for you, ask what you can do to be a Do-It-Yourselfer (DIY)."

                    User avatar
                    Clever_Username
                    Posts: 1384
                    Joined: Sun Jul 15, 2012 12:24 am
                    Location: Southern California

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by Clever_Username » Mon Aug 20, 2018 8:37 pm

                    cockersx3 wrote:
                    Sun Aug 19, 2018 3:28 pm
                    Seriously thinking about giving a talk at her school about investing basics. Just painful to watch people do things that are financially harmful.... :oops:
                    That'd be awesome. I'm not at her school (my 403(b) is at Vanguard, although there is also a Fidelity option!), but I think it's awesome if you'd be willing to do this. I only know the retirement contribution of two co-workers: one because his wife brought it up to me in conversation and the other is a friend who started after I did and I talked about it to her when she was starting.
                    "What was true then is true now. Have a plan. Stick to it." -- XXXX, _Layer Cake_ | | I survived my first downturn and all I got was this signature line.

                    sschullo
                    Posts: 2515
                    Joined: Sun Apr 01, 2007 8:25 am
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                    Contact:

                    Re: Teachers Who Have Net Worth of $1 million +

                    Post by sschullo » Mon Aug 20, 2018 8:46 pm

                    Gardner's Son wrote:
                    Thu Aug 16, 2018 12:01 pm
                    As a retired teacher, I'm interested in hearing from my fellow Life-Giving Educators who were able to devote their lives to teaching, invest over time, may have started side businesses, and have amassed over $1 million net.
                      How did you do it?
                        Perhaps share your net worth as a testament to other younger educators that teaching and having high net worth is possible.
                          Thanks!

                          How did I do it? We started with NOTHING. I wrote a book my story of how a couple of non financial people knowing very little about investing, made all of the major mistakes, starting late, over investing in crap and yet survived from two of the biggest stock market crashes in history with a million and no debt: Late Bloomer Millionaires, its on the Boglehead list BUT no need to purchase it as you can download a free PDF copy here:
                          http://latebloomerwealth.com/publicatio ... lionaires/

                          I also have a free 2nd book Fighting Powerful Interests, that is for working public k12 teachers only. It's a strange story about I navigated the horrific 403(b) plans, and how a few of us got our district to launch a low-cost, Award Winning, 457b plan: http://latebloomerwealth.com/publicatio ... interests/
                          Last edited by sschullo on Tue Aug 21, 2018 7:38 am, edited 1 time in total.
                          Public School K-12 Educators: "Ask NOT what your annuity sales person can do for you, ask what you can do to be a Do-It-Yourselfer (DIY)."

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