Teachers get an 'A' for savings
New research by the Co-operative Bank shows that teachers save the most out of 25 professions.
Those working in education save on average £2,125 each year, higher than those working in finance (£1,999) and over four times the amount saved by those in artistic and sport related jobs (£494).
Those working in agriculture and utilities save the least with those working in agriculture putting away just £343 on average each year. Us media types typically save £968 a year.
Whatever amount you can afford to save each month or year, it’s important to put it in the best paying account for your needs. To help you decide we’ve checked out the top paying regular savers, instant access accounts and fixed rate bonds.
Regular savers
If you are just beginning to save, regular savings accounts are a good option as they often pay a high rate compared to other savings accounts.
However, you will have to commit to a fixed monthly contribution between a minimum and maximum amount (typically £25 to £500), usually for 12 months.
The rate on the account normally falls after a year – but that’s a good time to move your nest egg into an Isa or bond.
The best-paying regular saver available to anyone is currently Cheshire’s Platinum Monthly Saver Issue 3 which pays 5%. Account holders can save between £100 and £500 a month.
First Direct current account customers can open a regular saver which pays a whopping 8%. Monthly contributions are capped at £300 but that still means that if you saved the maximum you can earn £156 gross interest a year.
Instant access
As the name suggests, instant or easy access accounts offer instant access to your money so they’re good if you need cash for emergencies.
ING Direct is currently No.1 for instant access, paying 3.1%. However the rate comes with an introductory bonus of 2.56% for a year meaning that after 12 months the account will pay just 0.54% AER.
Meanwhile the Post Office and Principality building society both pay 3.01% and both including a 1.36% bonus for 12 months.
In some comparison tables, you'll see Coventry Building Society's Online Saver 2 account ahead of the ING Direct account. Coventry's account pays 3.15% including a 1.15% bonus,, but you can only make four penalty-free withdrawals each year, so it's not a true instant access account.
If you opt for an account with an introductory bonus you should make a note of when the bonus period ends and be ready to shop around for a better account when the time comes – otherwise the rate will fall dramatically.
Fixed rate bonds
Fixed rate bonds are a good option if you don’t mind tying up your savings for a fixed period of time. With a bond the interest rate is fixed for a set period of time – anything from six months to five years.
However you won’t be able to access your money penalty-free during this period so you should only save in a bond if you have other, more accessible cash elsewhere.
In general the longer you fix for, the better the interest rate. At the moment you can fix for one year with Aldermore at 3.55%, for two years with BM Savings at 3.9%, for three years with BLME in a Sharia’a compliant account at 4% and for five years with AA at 4.6%.
Cash Isas
Cash Isas are a good home for your money as the interest is paid tax-free. Every adult in the UK can save up to £5,640 this year in a cash Isa and up to £11,280 split between a stocks and shares Isa and a cash Isa (with a maximum of £5,640 in a cash Isa).
Like other savings accounts, cash Isas can be instant access or fixed rate bonds. Halifax is currently offering a five-year fixed rate Isa at 4.5% and four years at 4.35%. Santander has a one-year fixed rate Isa at 3.5% while Saga offers one-year fixed at 3.6% to over-50s only.
Cheshire Building Society's Direct Cash ISA (Issue 2) is the top-paying instant access Cash ISA with a cracking 3.5% rate. This includes a 2.5% bonus which will be withdrawn in October 2013.
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The people who say teachers don't work hard don't know what they are talking about. They often roll out cliches such as 'try doing a real job' or 'I'd like to have 14 weeks holiday and work only 5 hours a day etc'. Thing is I have had 'real' jobs before in the engineering sector amongst other things, and I can comfortably say that teaching is the hardest thing I have ever done. I put in way more hours than I did when I was a graduate engineer and whereas when I used to clock off and go home that was it for the day, I have had to adapt to the idea of taking masses of work home with me as a regular thing and it being an expected part of the job and yes, this includes during the holidays. I work with plenty of people who have given up careers in services, banking and other industries who have said the same. Also in many academies (of which the majority of schools now are or are in the process of becoming) where the schools can set their own working hours and pay, many insist on a full 8am to 5pm working day with much reduced holidays that can only be booked in advance when the children are not in school. If teaching is such a gravy train why have all these people making such comments not given up their tough underpaid careers to join in with the easy life that is teaching? Funny that when I ask this of people they often say things like 'I'm not sure I would have the patience' or 'I don't think I could work with the stresses of 30+ children all day every day'. Hmm, I rest my case. As for savings well, as soon as I got into teaching I quickly realised that there would be no way that I would be able to still do it at 65 (or indeed 68+ as this government wants to put in place) and thought that the best way to ensure that wasn't the case was to put a lot of money away. I am going without things me and my wife would like to do in our lives right now for that very reason. Oh and by the way, I'm on less money teaching now than I was as a graduate engineer - so some people need to get their facts straight when they say teachers are paid too much. The person who said there is no accountability also needs to check their facts before posting. Teachers are judged in terms of their capability on their end of year GCSE and SATs results, performance management observations, regular (unnanounced) snapshots of lessons throughout the year, weekly learning walks, OfSTED inspections and half termly drop-ins by senior managers. Failure to perform in any of these can trigger capability proceedings. I know that not many teachers get 'sacked' according to the statistics, but the reality is many leave or are encouraged to leave way before it gets to that stage. Right, after a short break to vent my spleen I'm off to complete the marking I have been doing all Sunday afternoon - and then the evening is set aside for planning for Monday's lessons. I love my job but to call it an easy life is so laughable it is untrue.
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I think I can guess why... Now I do actually do some [language] teaching but my main career was in IT, which I managed to escape when it all got too boring. In the period I was searching around for something slightly more interesting I worked at ONS on their telephone call centre on the national labour force survey . You'd ask about hours worked before knowing what the actual job was, and I became pretty adept at guessing who was a teacher from what they told me about the hours they were working. It obviously depended on the time of year... So, the reason teachers save more is because they realise the emotional and physical drains of teaching means that they know they can't manage to do it until 65 or later. I now teach part time abroad, and although I enjoy it I know that I couldn't manage it full time. My colleagues here in another EU country also make jokes about the increasing pension age and how they will cope. Compared to when I was a student ( a nice middle-class grammar) with no OFSTED or time-wasting bureaucracy, I'd say current teacher don't have it easy. The emotional effort I put into my part-time hours is OK, but a full time job meeting the demands not just of the kids but the bureaucrats as well would lead me to a rampage with a Kalashnikov. So I reckon most teachers realise they can't continue until 60/65/66/67 or whatever the latest figure might be. Personal disclosure: I think my state pension age is 66. I'm not sure.....
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It doesn't matter whichever 'sector' you are in. It boils down to how well you are paid and what is your cost of living (this includes discretionary & non-discretionary expenditure). Should teachers be managing their discretionary expenditure well, then their surplus can be set aside. However, this can be attributed to any sector....including journalists! I for one, always ensure that from my salary (yep folks, not received a bonus in years....), I have money to pay bills, put food on the table and for the offspring's inevitable school trips (as well as travel to and from school), but if I have to go without so funds are set aside for a rainy day, then so be it. My parents were not as fortunate as I where income counts, but one thing they had in spades was being level-headed and teaching me to save. On top of that, my late Father taught me that there are lies, damn lies and then there are statistics....
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22 April 2012