You don’t want to put the hard work you do every day at risk. Start by making yourself aware of 5 common money mistakes that educators make. Then evaluate your finances, form a plan for success, and see how your NEA member benefits can help you get on the path to financial security.
Mistake #1
Not having enough (or any!) life insurance
Insurance is the safety net that helps protect all of the hard work you do, so you can continue to provide for your family if something should happen to you.
NEA Members Insurance Trust offers a wide range of life insurance solutions to NEA members, issued by The Prudential Insurance Company of America:
- NEA Complimentary Life Insurance is provided at no cost to you. Coverage includes $1,000 Term Life coverage, up to $5,000 Accidental Death & Dismemberment (AD&D) coverage, up to $50,000 AD&D coverage for covered accidents on the job, and up to $150,000 in life insurance for unlawful homicide on the job. And remember to name a beneficiary for your policy! See how easy it is here.
- NEA Group Term Life Insurance Plan is supplemental insurance to help your loved ones cover financial obligations such as a mortgage, college costs, an auto loan and more. Get flexible life insurance coverage amounts ranging from $25,000 to $500,000 (in $25,000 increments) at affordable rates, thanks to the power of NEA’s 3 million members.
- NEA Level Premium Group Term Life Insurance Plan offers affordable rates that you can lock in over the length of your loan term. You also can get coverage amounts ranging from $25,000 to $1 million (in $50,000 increments).
- NEA Guaranteed Issue Life Insurance Plan can help your loved ones cover your final expenses such as funeral and burial costs. No medical exam is required, and you can get coverage of either $10,000 or $20,000.
Mistake #2
Not starting to save early enough for retirement
It’s never too early to start to save for retirement. The earlier you start, the more time you’ll have to save, and the more money you might be able to stash away for your future self.
Let’s say you save $4,000 each year, with a 6% return compounded annually, until you turn 62. If you start saving at age 22, your investments could yield up to about $650,000. But if you wait until you are 32 to start saving, your investments could yield up to only about $335,000.
NEA Member Benefits provides several tools tailored for NEA members to help you see where you stand.
- Take the 5-minute retirement checkup to figure out if you’re on track.
- Check out our comprehensive retirement income calculator, which includes state pension data, to see what your retirement might look like.
- Download your free copy of “The Educator’s Guide to Retirement Planning” to get an overview of state pension plans, Social Security and the various considerations unique to public-school employees. Plus, there’s a 2-page checklist to help you assess your situation.
Mistake #3
Not choosing the right credit card
A credit card that fits your spending habits can help you maximize your rewards while you responsibly use and build your credit by spending within your budget and making your payments on time.
When searching for a credit card, ask yourself if you want to maximize your rewards with everyday purchases or if you use your card for large or unexpected expenses.
If you have balances on higher interest cards, look to transfer them to lower-rate cards to save on interest.
As an NEA member, you have two credit card options through NEA Member Benefits: NEA® Customized Cash Rewards Visa Signature® credit card and RateSmart® credit card.
Mistake #4
Not having an emergency fund
It’s important to plan ahead for unexpected situations – such as a medical emergency or job loss – so you won’t be caught off guard.
Experts recommend that you aim to set aside at least 3 to 6 months’ worth of living expenses to cover necessities such as your mortgage or rent, utility bills, phone and Internet, prescriptions and more.
Mistake #5
Not planning for life after you
Expressing your wishes through legally binding documents is an important way to help protect your loved ones and the assets you’ve left behind.
To get started, consult with a financial professional to draft an authenticated will, as well as trust and estate planning.
In addition, be sure to name beneficiaries for your insurance coverage and retirement accounts. Include their name, Social Security Number, and the allotment you’re leaving to them. Remember to update your beneficiaries and allotments as your life changes, as needed.
Not for residents of New Mexico
Not for use in New Mexico
This site may contain marketing language, on products issued by The Prudential Insurance Company of America, that has not yet been approved in all states.
AD&D coverage provides ACCIDENT insurance only. It does NOT provide basic hospital, basic medical, or major medical insurance as defined by the New York State Department of Financial Services.
IMPORTANT NOTICE — THIS POLICY DOES NOT PROVIDE COVERAGE FOR SICKNESS.
THIS IS AN EXCEPTED BENEFITS POLICY. IT PROVIDES COVERAGE ONLY FOR THE LIMITED BENEFITS OR SERVICES SPECIFIED IN THE POLICY.
NEA Life and Accidental Death and Dismemberment insurance coverage are issued by The Prudential Insurance Company of America. Newark, NJ. The Booklet-Certificate contains all details, including any exclusions, limitations, and restrictions, which may apply. CA COA #1179, NAIC #68241. Contract Series: 83500, 31300
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