A celebration of sorts

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AlaskaTeach
Posts: 220
Joined: Fri May 27, 2022 8:51 pm

A celebration of sorts

Post by AlaskaTeach »

As a teacher in rural Alaska, I have plenty of time on my hands. I set financial goals and tomorrow is the culmination of one of the goals. A couple of weeks ago I locked in most of the gains from my retirement account, because I am planning on buying the 6 years of Alaska time from the Texas retirement system. I predict the money will go from a qualified account to the Texas system about May 1, 2025 so I am standing pat with the money I predict will be needed, between 90k and 100k. I just took a look at my retirement transactions, noted the monthly contribution was made May 14, and looked at the graph. Empower shows my account is scheduled to go from 65k on 06/30/23 to 95k by 06/30/24! Amazing! This is the state retirement system currently in place for teachers. The employee contributes 8%, the state contributes 7%, and the account is fully vested after 5 years of service. My account fully vested about a year ago, so this last year has been gravy, watching the account.

I will lock in the rest of the gains tomorrow(Wednesday) morning. The last contribution goes into the account in mid June.

It's a combination of things happening and some incredible timing. I think it was last year when a colleague suggested that since I am such a penny pincher, I should consider going to the 10-month payday calendar, instead of the usual 12 months. I did that and the result is a speeding up of contributions going into the account, which is a bit greater than I anticipated.

The other major help was investing in the S and P 500 index fund. At some point I changed my future contributions to 100% S and P 500 fund and it worked beautifully.

The money will be in a money market fund currently yielding over 5% and the only haggle I have with Empower is that July 20 is when the annual fee is scheduled to be charged, probably $35, and they claim they need 60 days notice to close out the account. My last day of work above the Arctic Circle is May 24.

To make this actionable, I believe if there are teachers on this forum interested in making some money and paying off debt, etc. you could do a lot worse than making six figures above the Arctic Circle where there are little opportunities to spend too much money.

Also, if anyone can think of a good reason for Empower to waive the annual fee, that would be appreciated. I wondered why the 60 day requirement, and now I see it clearly. 60 days after the end of school is just past July 20.

I am moving the money to a $0 fee Fidelity money market to hold for the next 11 or so months until I purchase the service credit.

Wow! :D
CoAndy
Posts: 957
Joined: Thu Jun 06, 2013 4:45 pm

Re: A celebration of sorts

Post by CoAndy »

Congratulations! :sharebeer
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