How to Survive the Summer Paycheck Gap

On a 10-month school salary? Try these expert ideas for saving and budgeting, and say goodbye to summer cash-flow stress.

Woman Using Laptop in Home Office

by NEA Member Benefits

Jan 03, 2022


Looking forward to summer break after a long and challenging school year? While you’re happily planning your summer fun, don’t forget to check your budget.

Many educators receive a paycheck during the school year, but their salary schedule doesn’t provide regular income over the summer. We asked educators to talk about how they stretch their money during the break, along with smart savings strategies to better prepare for next summer. 

The 10-month option vs. the 12-month option

Some schools give educators a choice between receiving their full annual salary paid over 10 months (resulting in more money per paycheck) or paychecks on a 12-month schedule.

“My district allows teachers to spread pay over 12 months,” says Debra Spector, an elementary school teacher in California. “It’s helpful to keep that income flowing every month. This ‘deferred pay’ plan takes care of any budgeting headaches that might arise if I were to miss a paycheck over the summer. It’s a great plan that simplifies things.”

Confirm your salary schedule enrollment details

Bon Crowder, a special education and math teacher in Texas, opted for the 12-month plan. However, she didn’t know she had been put on the 10-month plan instead until her paychecks suddenly stopped in the summer. “I have been in this situation quite a few times,” she says, and has learned get everything in writing.

Make sure all the details are spelled out when you sign your contract. Know when you’ll be paid and how often. If you’re a new teacher, you may be reluctant to make waves and ask for specifics, but Crowder says you need to “be cognizant of when your paycheck restarts so you can plan” instead of being “hosed for an entire month.”

A gentle and diplomatic question can put you on the radar of your school district’s payroll administrator. Ask if there’s anything else they need from you, and say, “I want to make sure I’ve done everything I’m supposed to do.” Crowder says that’s code for “did you put me in the system?”

Be your own paymaster

Danny Kofke, an elementary school teacher who spent most of his career “in a self-contained, severe, profound special education classroom,” is currently a personal finance author and retirement consultant. At one Florida school where he worked with his wife, employees were given their summer pay for June, July and August as a lump sum on the last day of the school year.

That should cover the summer gap, but Kofke says “most people—not just teachers, but average Americans—don’t know how to budget it and they just blow it all” and return to work in August with no money left in their bank account.

To make sure their money lasted, the married public school teachers divided their summer pay into three portions and acted as their own payroll administrators. They put one-third of the lump sum into their checking account as if it were their June paychecks. The rest went into their savings account. They pretended the money wasn’t there until it was time to draw out the usual amounts of their July and August paychecks. 

That way, “we didn’t have all that money at one time, and we were able to stay within a budget,” Kofke says. 

Manage your money and debt to reduce stress

Summer school teaching jobs provided a bridge between paychecks for Malisa Bright, a high school math teacher in California who is married to a teacher in the same district on the same pay schedule.

She has tried to save to survive the summer paycheck gap, but something always came along to derail her plans. She and her husband tried to get summer school jobs every year, but when jobs were scarce during lean economic times, they didn’t always find work. 

Instead, they “relied on a combination of credit cards, and then refinancing the house” to pay down those credit cards and even taking advantage of car loan “skip a payment” options, Bright says.

Eventually, they were drowning in credit card debt. They found a financial program that helped them get a handle on their income and expenses. “I don’t know where we’d have been without You Need A Budget,” Bright says. The software transformed the way they thought about money and helped them break annual expenses into monthly chunks that they funded all year long.

Get advice on how to build a stress-free budget, plus a free downloadable worksheet for NEA members. You also can find actionable tips on how to cut your monthly bills without cutting corners.

Set a financial goal, and go for it

It’s not as difficult to stay on track as many people think. “I’m not saying it’s easy,” but it is doable, says Kofke. The key to saving strategically is to have “an ultimate goal in place that you’re working toward.”

When he married his wife, Tracy, their goal was to be financially secure enough to allow her to stay home for a year when their first child was born. Any time they were tempted to spend, they thought of that goal and how much it meant to both of them.

“We lived on my salary of about $42,000 a year for nine years,” Kofke says. They had one car and paid it off in two years. When friends wanted to go out on Friday nights, “we would do it occasionally, but we knew we couldn’t have it all. We couldn’t do it every single week or we wouldn’t meet our goal.”

If you’re looking for a financial edge, sign up for the NEA Financial Whiteboard Newsletter. In this four-part email series, you’ll get smart tips to help you stretch your paycheck, manage credit, find student debt relief and save for the future.


One of the best ways to improve your summer financial experience is to plan ahead. Joyce Cavanagh, PhD, is an associate professor and extension family economics specialist at Texas A&M University whose work focuses on family financial management, workforce development, financial literacy for youth and financial security in later life. She shared these tips for educators to be prepared to deal with any potential summer pay-gap challenges.

1. Figure out how much money you’ll need

How long will you be without a regular paycheck? If you’ll be on the 10-month pay schedule, find out when you’ll get your last check of the school year and your first check of the next school year. That’s the time period you need to manage for, Cavanagh says.

Start by adding up your expenses. Add up the necessities that you can’t cut. That total is the target amount you need to save to get through the months without pay.

Divide that total by the number of months in which you could save aside some money throughout the school year. That total is the amount you need to add to a savings account each month to cover the gap.

Too much? If you can’t realistically add that much to your monthly savings goal, where can you lower some expenses? Instead of having meals out or picking up take-out foods frequently, could you cook at home more often? Could you have movie or game nights at home instead of going out for entertainment?

2.  Have a separate savings account

Put the money you’re saving to cover your unpaid months in a separate savings account that you can withdraw funds from without penalty. If you may be tempted to tap the fund, then choose to put the account in a bank that’s not conveniently located, and don’t set up easy online access.

3. Be frank with older children

“A lot of times, parents are reluctant to talk about money with their children,” Cavanagh says. You don’t need to go into detail down to the last penny, but when kids understand that sacrifices have to be made and the whole family is reducing expenses, many will “get on board and make life a little easier for Mom and Dad.”

4. Consider earning secondary income

If you’ve exhausted all the ways to reduce your expenditures and still don’t have enough money, balance the costs (childcare, for example) and benefits (extra income) of a short-term, part-time job. It doesn’t have to be flipping burgers. Maybe a friend’s lawn care business is shorthanded in summer. Maybe when neighbors are on vacation, they need someone to pick up mail and newspapers, harvest the garden or take care of pets.

“What skills do you have that you can turn into money-making activities?” Cavanagh asks. Decide what you’ll do, and create a flyer that describes the service you’ll perform and tells people how to contact you. Network with friends, neighbors and others in person and on social media. Let people know you’re off for the summer and looking for a way to make some extra money. Ask if they know anyone at work, church or in the neighborhood who might need the kind of service you’re providing.

5. Set aside money for taxes

If you pick up a summer job, the pay you receive is taxable income, so be sure you keep adequate records, Cavanagh says. “Depending on what you make throughout the summer, you may need to adjust your withholding when you get back to school” or have your non-educator spouse adjust their withholding amount during the summer months.

If you’re self-employed for the summer, you’ll also have self-employment taxes on your income, as well as Social Security.