For part-time contractors, “adjunct” defines irregular pay. If you’re working on a semester basis, you’re likely being paid only eight out of every twelve months. During the winter break and the three summer months, you go hungry unless you manage to land a summer course. Often, because of the inconsistency with which courses are scheduled, it seems as though no two paychecks are the same.
In my case, for example, early in the semester a paycheck can be a little over $500 for two sections, but then when the seven-week online course I teach in the second half of the term kicks in, suddenly I’m earning over $1,000 a check. As we can see from Josh Boldt’s crowd-sourced Adjunct Project, chronic financial insecurity and low pay are hallmarks of adjunct work.
It makes budgeting difficult, to say the least.
No doubt there are many ways to deal with this. I’ve certainly tried a few, with varying degrees of success.
The approach that works the best for me is to find a way to pay myself a steady paycheck that’s independent of the college’s on-again, off-again payments.
I accomplished this by establishing a pool into which all personal income other than Social Security (which covers slightly less than half my living costs) is poured.
Every penny of teaching pay goes into the pool.
Tax refunds (usually about $4,000 a year) go into the pool.
The annual kickback on the Costco American Express card goes into the pool.
The annual payment from the state toward the $18,000 worth of sick leave pay I was owed at the time the Great Desert University laid me off goes into the pool.
Any windfall of any kind goes into the pool. If tomorrow I won a million bucks on the lottery, it would go into the pool.
From this pool, which resides in a money market account in my credit union (interest is a tiny bit higher than an ordinary savings account), I disburse a monthly figure to my checking account; presently it makes up about half the amount I need to live on.
Now it must be said that I’ve been fortunate in three ways. First, by the time I was laid off, I had managed to eliminate all debt but a portion of a mortgage on a house I co-own with my son. Second, I was eligible for some Social Security at the time GDU canned me and all my staff—not the amount I planned to take by delaying retirement to the age of 70 or even at my so-called “full” retirement age of 66½, but at least it was something. And third, over the several years that GDU was paying me a decent full-time administrative salary, I lived frugally and accrued a large emergency fund. That fund became the basis of the “pool.”
Thus there’s a pile of cash that I can dip into and then refill as new money comes in from teaching and various other sources.
It’s possible to build a fund like this by taking a second or a third job. Delivering pizza and waiting tables (in certain kinds of restaurants) will earn more than adjunct teaching usually pays. So, if your goal is to spend your time at adjunct teaching and nothing else, it’s worth biting the bullet for a few months, working several jobs, living like an anchorite, and stashing every extra penny in a bank account. This assumes you have no dependent children, whose care, of course, will vacuum up anything you earn.
Alternatives? Borrow from relatives; mooch from friends; rob banks. Or get a decent job outside of teaching.
But let’s assume you’re going to try to make it at adjunct teaching. Maybe you imagine someday this will get you in the door to a full-time tenure-track position, or possibly you have a working spouse and you’re teaching adjunct because no real jobs are available where you must live. Maybe like me you have another small income and feel no desire to work full-time. There are circumstances in which adjunct teaching might not be an utterly disastrous choice. Whatever. You have an income; you have an outgo.
Calculate your net income by subtracting the total amount of tax that will be engrossed from your pay over the course of a year. The bite should be around 15 or 20 percent. Yours may be lower or higher; however, if your employer is like mine, it will insist on extracting a larger amount than you ultimately will owe on poverty-level wages. My college, for example, is presently withholding 25%, despite my having claimed as many exemptions as I can without getting into trouble with the IRS. At the end of the year, I get the money back in refunds from the state and federal governments, but because there’s no real way of knowing how much will be returned, I budget under the assumption that any money dinged from my pay for taxes is just gone.
Now divide your annual net pay by 12 to arrive at a monthly net figure. This amount is your monthly “paycheck,” which can be disbursed from the “pool” steadily, all year round. If your math is right, it will not matter exactly how much is deposited (or not deposited) in any given month. Your total academic-year income will be enough to cover your monthly withdrawals over the calendar year.
For example, if I’m teaching three and three and one, my net pay from teaching is $12,600. Divided by 12, that provides $1,050 a month, just about half what I need to pay day-to-day living costs and routine maintenance on my house. The other half comes from Social Security and a small drawdown from savings.
As a practical matter, in many months I do not see $1,050 a month. Between December 15 and January 30, I see nothing. Between mid-May and whenever my summer course runs, I see nothing, and between the end of my summer course and about August 30 I see nothing. In the interim, paychecks can run anywhere from $250 to $1250.
Paying myself $1,050 in a month when I earn less than that—or nothing—is a scary proposition. However, it all evens out.
Let’s say I start with a prefunded pool of $10,000. If I’m putting every penny of net pay into the bank account where that pool resides, in some months the account’s balance will drop below $10,000. In others, it will stay above that threshold even after I’ve paid myself the monthly dole.
Because some of the money transferred into the pool comes from windfalls other than teaching income—credit-card kickbacks or insurance reimbursements, for example, as well the obvious tax refunds and benefits still accruing from the forced “retirement”—it’s not outside the realm of possibility that the pool’s base amount will grow over time.
However, as a practical matter, sh!t happens. Occasional emergencies arise that are too big to handle with an ordinary monthly “income.” Just one of those can take a chunk out of the “pool.”
For that reason, I build a short-term secondary emergency fund by setting aside, in a separate savings account, $200 a month from combined Social Security and the monthly “paycheck.” Assuming you can get through six or eight months without a truly major expense, in less than a year you can accrue enough to cover most auto repair costs and relatively small uncovered dental, vision, or medical care bills, or to buy the occasional pair of shoes or clothing. Major bills, obviously, will have to come from a larger fund or be covered by loans.
It can work, but if your pay is as low as mine ($2400 per class, with a typical load of 3/3/1), you’ll need either a second income or a place to live with almost no overhead. In 2011, I made a $7,390 fund stretch for 6 months and in fact began 2012 with about $2,000 more than expected. Because I’ll get a tax refund and one last sick-leave reimbursement this year, I expect the survival “pool” to last at least until the end of this year. But I managed it because Social Security covers almost half my routine costs. This is with a paid-off house, a paid-off car, and habits most people would regard as intolerably frugal.
Could be worse, though. When I started this in December 2009, I figured I’d be living under the Seventh Avenue Overpass before much time passed.