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To Singapore Teachers: 10 Financial Lessons I Wish I Knew

Updated: Aug 23, 2022

Due to their heavy workload, most teachers do not have time to work out and plan their finances. This article lists down 10 important financial lessons that teachers should act on during their careers.

Here are some important financial lessons for teachers that would be relevant throughout one’s lifetime!


By the way:

When was the last time you've done a proper Investment plan or reviewed your investments?

In Singapore, having a proper investment plan could spell the difference between a rich quality of life for you & your loved ones and a not-so-good quality of life...

And people are starting to realize this.


1. SMART financial goal

The first financial lesson for teachers would be to set a SMART financial goal. SMART stands for Specific, Measurable, Attainable, Relevant and Timebound.

By being specific, you would ask yourself what you are saving for. For instance, your savings could be used as an emergency fund.

Measurable would be the amount you would be planning to save. Attainable would be how realistic this goal is.

Relevance would be the importance of saving, and lastly, timebound which would be when you would meet your goal.

You can kick start by identifying specific action steps that may help you meet your SMART goal targets. For instance, you can start packing your food to work instead of buying food to cut down food expenses.

The action plans are plans that you aim to achieve your saving goals. The SMART financial goal would help you to cut down your expenses and save money in the long run!

2. Have an insurance plan

You might be asking yourself: why would I need an insurance plan?

Insurance is important as it helps to manage risk, transferring the cost of a potential loss to the insurance company in exchange for a fee, which is the premium that one would pay.

There are various types of insurance, ranging from health to life insurance.

This financial lesson differs for teachers as there are schemes available only for teachers!

For teachers, one can apply for the Public Officers Group Insurance Scheme (POGIS). POGIS is a public officers group insurance scheme introduced by Singlife with Aviva.

To reward those working in the public service, this scheme ensures that both your needs and your loved ones are taken care of.

This is a life protection plan exclusively for public officers. This plan provides worldwide coverage until you reach the age of 75 years old and premium charges from as low as $0.41 per month.

It provides high-term life coverage, lump-sum payout, additional payout for accidental death, additional monthly payout for Total and Permanent Disability (TPD) for 24 months, and free coverage for your children at a low price!

3. Start Investing

On top of having an insurance plan, the next financial lesson teachers should note would be to look at the various methods of earning passive income! Investing is crucial to building your wealth.

Investing allows one to reach their financial goal faster! It grows the money you work for today based on the rate of return of investment.

Starting earlier allows one to know their risk profile, take more risks and have an opportunity to earn better returns. One would be able to recover from bad decisions without affecting long-term financial goals.

With compounding interest, it is a powerful tool to generate your wealth.

This helps you plan for retirement too!

Teachers are generally busy with many take-home assignments for marking. This makes investing a viable option for them to generate their wealth on top of their current pay as a side hustle with minimal effort!

This financial lesson is very beneficial for time-strapped teachers who want to earn a passive income!

Investing early helps to build a healthy spending-saving balance due to the financial commitment to the investments. This reduces the amount of disposable income one has on hand, hence making only necessary expenses.

There are many financial lessons available online that teach you how to start investing.

You can also check out this article on the 9 best investment apps in Singapore to kickstart your investment journey!

4. Understanding the importance of CPF & SRS

Understanding CPF is an important financial lesson for teachers as it is a key pillar of Singapore’s social security system. It serves to meet our retirement, housing and healthcare needs.

Topping up CPF is beneficial to teachers as it helps to grow your retirement savings. Singapore provides an attractive interest rate of up to 6% per annum, allowing your retirement savings to grow with compounding interest. This generates higher monthly payouts in retirement.

Topping up CPF is another option to grow your retirement savings. As teachers are strapped for time, this is a safe and viable option to generate more savings for retirement!

One may also enjoy a tax relief of up to $16,000.

On the other hand, the Supplementary Retirement Scheme (SRS) is a voluntary scheme encouraging individuals to save for retirement, over and above their CPF savings. The contributions to SRS are eligible for tax relief.

Similarly, topping up your SRS account allows you to save more on tax every year with a higher contribution amount. This reduces the taxable income.

This is one of the most crucial financial lessons that teachers should know to plan for retirement! It also helps you to better manage your assets.

5. Pay off your university debt

Paying off your student loan would be crucial as, like most other debts, the student loan accrues interest when you carry a balance.

Many, including teachers, often neglect this financial lesson as it does not seem to impact your savings at the beginning. However, the interest-free student loan ends 6 months after you graduate. The interest then accumulates, increasing your liability in the long run.

It is better to pay off the loans earlier as it gives the debt less time to accumulate interest so that you pay less in the long run.

Debts are liabilities, reducing the amount of savings you have over time. It is beneficial to repay your debts to reduce liability and ensure greater financial stability.

Repaying your debts early also reduces the amount of interest accumulated, paying off less in the long run.

6. Have an emergency fund

Having an emergency fund is essential as it creates a financial buffer that keeps you afloat in times of financial crisis. It helps to cover purchases that you did not budget for.

This financial lesson would be crucial for teachers as it allows you to manage your finances better should you face any unforeseen circumstances in future.

This is even more crucial when you have a debt as it prevents you from borrowing more.

If you only have one source of income, you should have at least 6 months worth of expenses in your emergency fund. This helps to cushion the blow from unexpected expenses or events e.g. retrenchment.

For teachers, teaching is probably their only source of income, hence, setting aside an emergency fund is beneficial as a financial buffer in the event of an emergency, e.g. retrenchment.

7. Always pay off your credit card debt

Another important financial lesson for teachers: paying off your credit card debt is important as it helps with your credit scores!

It is always ideal to charge only what you can afford to pay off every month. Leaving a balance would not be beneficial to your credit scores and would just cost money in the form of interest.

A high balance on your credit cards hurts your credit scores as it increases your credit utilisation ratio.

This ratio shows how much of your available credit you are using and is an important factor in your credit scores.

You should always aim to make all your payments on time as it has a significant impact on your credit scores. Similar to the fifth point, this financial lesson should not be neglected!

For teachers who are busy marking assignments and rushing deadlines, the main takeaway from this financial lesson is to always pay off your credit card debt early!

Leaving a balance on your credit card not only affects your credit scores but also accumulates more interest, increasing the amount that you have to pay in the long run.

8. Draft a will

As a teacher, you should also draft a will as it makes provisions for a deceased person’s loved ones rather than leaving decisions unsettled.

A will is beneficial to determine how assets will be distributed and managed after death or in the event of unforeseen circumstances. This brings clarity and direction to the distribution of assets.

Many may not see the importance of drafting a will. However, as a teacher, this financial lesson brings about clarity and organisation after you pass on.

Teachers often neglect their personal life due to their busy schedules. Hence, they need to note down this financial lesson and take time aside during the school holidays to plan for their future by drafting a will!

If someone depends on you for financial support, you need a will, a trust, and power of attorney to ensure that your loved ones are protected should you pass on.

A will also helps reduce the potential for family disputes. If you pass away without a will, your family may have to figure out what your final wishes were and they may not always come to a consensus.

When you draft a will, it gives them a guide to follow after you pass. This gives many people peace of mind, highlighting how crucial it is to have a will.

9. Taking care of your mental health with an insurance coverage

As a teacher, you will face different types of students. With the stress and expectations for each student to do well, these pressures are often faced by teachers too.

Some students will excel academically and some will not fare as well. However, education is no longer about how academically inclined you are. The mental well-being of students needs to be considered too.

Often, many students face high levels of stress due to the academic pressure to do well in school. Teachers may have to address this issue and help those students who are suffering.

Hence, insurance coverage for mental health is a beneficial financial lesson for teachers.

There is insurance coverage available for mental health to encourage those suffering to seek help.

Beyond Medisave and integrated shield plans are mental health insurance plans available that can help to cover the costs of treatments and diagnoses associated with mental health illnesses.

Such insurance coverage also helps one gain peace of mind.

A stress-inducing environment may contribute to mental illnesses, hence buying insurance coverage helps reduce the cost incurred for future treatments.

10. Put your CONNECTPlan to better use

The CONNECTplan is an incentive plan to encourage teachers to stay in the teaching service. Under the CONNECT plan, MOE sets aside a sum of money each year for eligible teachers.

This is paid out at key points during your teaching career. Many teachers are unaware of this scheme, hence to all the teachers out there, do take note of this financial lesson!

However, if you resign from your job before the payout, you will forfeit the deposits.

MOE’s CONNECTplan deposits and payouts:

A teacher with a Postgraduate Diploma in Education (PGDE) receives $168,000 as payout if they stay in the teaching service for 30 years on top of their regular salary and annual bonuses.

As the payout is received on top of your regular salary, you should portion out some of the payout into investing. A lump sum is given at the end of every 3 or 5 years, and the monthly income will be enough to cover all expenses.

Hence, this payout is a large source of income. With this amount of capital, investing is a wise choice as this will help generate passive income on top of your salary. This financial lesson would be very beneficial for all teachers!

The larger the capital, the more interest it accumulates, thus growing your savings over time.

This is one of the main takeaways from the 10 financial lessons for teachers as this plan is only available for teachers to incentivise teachers to stay in the industry.


These are the various important financial lessons that teachers can adopt during their careers to make full use of their capital to build their wealth.

There are also many tips that do not only apply to teachers but to the general public as well.

Investment is the key to generating wealth, hence it is wise to invest and make use of the available capital to generate more income. If you're keen on investing but have no idea where to begin, it would be smart then to work with a financial professional.

Contrary to their reputation for pushy sales tactics, financial advisers help new investors cut through the noise.

According to a survey report by St James’s Place Wealth Management, a majority of Singaporeans or 81%, stated that they heavily prioritise seeking financial advice before making any major financial decision.

And 56% ranked financial advisers as their top source of financial advice.

Financial advisors can arrange your investments and build a financial plan that helps ensure you will meet your financial goals in a sustainable manner.

With the right investing strategy, that growth may be accelerated and you’re more likely to beat the CPF interest rate.

If you’re interested in seeing for yourself what an investment advisor can help you achieve, Techiya offers a free comprehensive and personalized financial assessment worth over $200!

At the end of the day, these financial lessons for teachers aim to benefit everyone so that you can relish in comfort during retirement!



Learn Important Financial Lessons from an Ex-Teacher

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