Tomorrow’s lesson plan: Tutoring teachers how to retire

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Durham Public Schools in Durham, North Carolina was concerned that its teachers and staff weren’t participating enough in the school district’s many retirement and supplemental retirement programs. It set about trying to find a solution to the problem.

“We offer the whole gamut of benefits but at the same time we struggle. We have a tremendous challenge educating them on their benefits,” says Aaron Beaulieu, chief operating officer for Durham Public Schools.

The district convened an ad hoc committee to take a harder look at its supplemental retirement programs and ways to get employees more involved. Made up of administrators, principals, HR and finance staff and teachers, the committee realized that it needed to work with employees on financial wellness.

“Even though retirement is the ultimate goal for all of us, some have to get in a better position to get there or be fiscally responsible,” he says.

Durham Public Schools employs 4,900 teachers and staff across 53 schools. Teachers make between $30,000 and $53,000 a year, depending on how many years they’ve been teaching. The district also has high turnover in its teaching staff: 600 to 700 teachers a year out of 2,500, which makes it hard to get the word out to everyone about the different benefits programs available. On May 16, teachers in North Carolina protested their low pay in a rally outside the state capital, and the New York Times reported that educators here “earned an average of $9,000 less than the national average of $59,000 during the 2016-7 school year, according to the National Center for Educational Statistics.”

In addition to a state-sponsored pension plan, Durham Public Schools employees have access to four supplemental savings options: the North Carolina 401(k) and a 457 plan, which are sponsored by the state but administered at the district level; and a local 403(b) plan and a local 457 plan sponsored by the district.

See also: Defined benefit pension plans help retain teacher talent

“It’s a lot to navigate,” says Amy Simonson, vice president, finance and operations, for Verity Asset Management/Verity Investments, Inc. and a consultant helping Durham Public Schools work through its financial wellness offering.

The district wanted to “empower teachers and staff to be better stewards of their own finances,” she adds. The best way to do that was to invest in an unbiased education program that wasn’t tied to any one vendor or supplemental retirement plan. They found Financial Finesse, a well-known financial wellness company that offers both in-person, online and telephone access to certified financial planners.

The district decided to brand its financial wellness program “Financial Fitness” and designed an entire education campaign around Take 10 for Financial Fitness, to get employees to take a survey about their financial concerns. The school district started by rolling out the Financial Finesse resource center, online tools and financial wellness assessment to staff at the district’s central administration building. It then rolled it out to school principals, asking them to nominate someone else in their building to be a financial fitness champion as well. Every school that participated was enrolled in a raffle for $1,000.

The program went live to the entire district in October of last year. It was a 10-day launch where the district sent out districtwide e-mails every day highlighting a particular financial wellness topic with a link from the Financial Finesse resource center. Those who completed the assessment were entered into a raffle to win $100.

School’s not exactly out for summer

Durham Public Schools is also toying with the notion of a summer boot camp for teachers, which would be a series of morning workshops on topics that would appeal to district employees, like public loan forgiveness programs and how to address student loan debt. Budgeting was one of the biggest concerns teachers and staff expressed on their financial wellness surveys.

Beaulieu says he believes the district employees who have participated in the program have benefited greatly so far and Durham Public Schools wants to “build on it and make it a stronger program.” He adds, “We said we would like to make it a two-year pilot. In the first year we are getting good information and the second year we will build off the initial success.”

The district offers great health insurance benefits as well. For those employees who came on board before the 2003-04 school year and worked for the district for at least five years, their health insurance will be fully paid in retirement. For those who came on board after that 2003-04 time frame, employees must work for the district for 10 years to get half of their health insurance paid for in retirement. If they work 20 years for the district, they will get full healthcare in retirement, says Paul LeSieur, chief financial officer for Durham Public Schools.

“We want what is best for our employees. We want to retain them and keep them as long as we can,” says Beaulieu. “We hope to really focus on what do employees need, what provides them the best opportunity to stay with us and put themselves in the best financial standing they can be while working. That’s a challenge. I’m not ashamed to say it. Our teachers work hard, but some of their financial knowledge is not commensurate with other industries.”

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Financial literacy Retirement education Retirement readiness Retirement income Retirement planning Retirement benefits Financial wellness Financial planning