Summer Break: A Great Time to Plan
For university faculty and staff, summer often brings a welcome change of pace. With fewer day-to-day demands and a quieter campus, it’s an ideal time to step back and focus on areas that are easy to overlook during the academic year.
That makes summer the perfect opportunity for a financial check-in. Academic careers come with unique benefits, retirement plans, and planning considerations that don’t always align with traditional corporate financial advice. Taking time now to review your finances can help ensure you’re making the most of the opportunities available to you and staying on track toward your long-term goals.
At The Legacy Foundation, we work closely with university professionals and encourage them to use the summer months as a financial reset. Here are a few areas worth reviewing before the fall semester begins.
Give your retirement accounts a real review
University retirement benefits are a strategic part of your financial planning. Many institutions offer a 403(b), and many also offer a 457(b) — and these two plans can often be used together, each with its own contribution limit. Used in coordination, they create a substantial opportunity to save on a tax-advantaged basis.
Yet in the rush of the academic year, these accounts are easy to set and forget. Are you taking advantage of maximum contribution and catch-up options? Are you sheltering your pay increases to keep up with your future needs? An hour of attention now can meaningfully change where you stand at retirement.
Plan around the rhythm of academic pay
One feature of university employment deserves special attention: the shape of the paycheck. Many faculty are paid over nine or ten months, while others elect to spread the same salary across twelve. Each approach has real cash-flow consequences. If you are paid on a nine-month schedule, the summer months call for deliberate budgeting so that a lighter-income stretch does not become a stressful one.
If you take on summer teaching, grant-funded work, or outside consulting, that income carries its own considerations and tax-sheltering opportunities — additional earnings are not always taxed at the rate people expect, and a little planning prevents an unwelcome surprise next spring.
If a career move is on the horizon
The academic world is mobile, and faculty often move between institutions over a career. If a move is a possibility for you, summer is the time to think through the financial mechanics: how your retirement accounts would transfer, whether you would be vesting in or out of important benefits, and how a new institution's plan compares to your current one. Decisions made in the excitement of a new appointment are far better decisions when the groundwork was laid in a calm summer month.
Set the stage for the year ahead
Finally, use this time to look forward. The new academic year arrives with its own demands and leaves little space for financial reflection. A summer reset — contributions confirmed, benefits understood, cash flow planned, goals revisited — means you can step into the fall semester with your financial life already in order.
Final Thought
Set the stage for the year ahead, and use this time to look forward. The new academic year arrives with its own demands and leaves little space for financial reflection. A summer reset — contributions confirmed, benefits understood, cash flow planned, goals revisited — means you can step into the fall semester with your financial life already in order. The Legacy Foundation specializes in financial planning for the academic community. Connect with us to learn more about how we can help you keep your goals on track.
Disclaimer:
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Investing in mutual funds involves risk, including possible loss of principal. An investment in Exchange Traded Funds (ETF), structured as a mutual fund or unit investment trust, involves the risk of losing money and should be considered as part of an overall program, not a complete investment program. An investment in ETFs involves additional risks such as not diversified, price volatility, competitive industry pressure, international political and economic developments, possible trading halts, and index tracking errors. Because of their narrow focus, sector investing will be subject to greater volatility than investing more broadly across many sectors and companies. Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price. No strategy assures success or protects against loss.
