More than a million people take out payday loans each year in the UK, and reportedly, a vast majority of these people are teachers. Each individual’s situation varies, but there are a number of reasons to explain why payday loans for teachers are far more common than any other profession.
Performance related pay
In 1988, the National Curriculum was introduced to the UK education system, as a way to monitor the progress of students. This also meant that teachers pay became performance related. Since the National Curriculum was introduced, wages are now determined by student exam results, progress and the quality of extracurricular activities put on by the teachers. While this means teachers may find it easier to get a pay rise over time, new teachers may find it difficult to manage.
Teachers who are just starting out in the industry have no previous experience to base their performance related pay on, so will need to work for longer before they are considered for a higher, more manageable wage. This also means that teachers who work in slightly more difficult, less disciplined schools, may find it much harder to reach targets and therefore earn a pay rise.
Due to the mobility of the job, new teachers will quite often choose to move away from home in order to take a teaching job. This means that for those living at home with parents, they may need to get a place of their own. It could also mean that they will need to move closer to the city for work – which then leads to higher rent costs. This, combined with the performance related pay, mean teachers new to the industry may have difficulty managing their money and may turn to a payday loan to see them through.
Since 2010, a majority of teachers have had to face a six year pay freeze. This pay freeze means that previous commitments, such as a mortgage or finance on a car, have now become far harder to manage. Payday loans for teachers then becomes a suitable alternative to cover financial commitments until payday.
Payday loans for teachers to manage the pro rata pay
The six weeks holidays may be an enticing reason to enter the teaching profession. But the pro rata pay may be something to consider. Quite often, teachers are paid pro rata, which means they are only paid for the weeks that they work throughout the year. The summer holidays are not included in the annual pay. Most schools will therefore spread the annual pay over the course of a year, so staff are still paid during the holidays. This then means that the hours worked each month, do not necessarily equate to what they will be paid, in order to still be paid over the summer holidays. Another solution may then be payday loans for teachers, which will help cover the cost of essentials until payday.