Teacher’s Spending Habits Spark Financial Turnaround

From Impulse Buys to Income Streams: A First-Grade Educator’s Money Makeover

A young teacher found herself trapped in a cycle of debt due to emotional spending. Now, she’s rebuilt her finances and even discovered new income streams.

The Stress of Overspending

Maddie Baker, 27, candidly admits her early teaching years were marked by impulsive purchases. Six years ago, starting her career with kindergarteners, she regularly bought daily coffees, succumbed to frequent clothing shopping, and took vacations she now recognizes were financially irresponsible.

The first-grade teacher shared that challenging days at work often led directly to retail therapy. The way I was coping with hard days was by spending money, she told CNBC Make It.

Her spending habits were not unique. A July LendingTree survey revealed that nearly half of U.S. consumers shop to improve their mood. While emotional spending can offer temporary solace, it frequently leads to financial hardship.

Baker experienced this firsthand, falling into horrible cycles of living paycheck to paycheck to avoid credit card debt. The LendingTree data indicated that almost three-quarters of such shoppers overspend, with 44% reporting negative impacts on their financial well-being.

Breaking Free from the Cycle

The financial strain became overwhelming for Baker, who was earning about $50,000 annually at the time. I remember just waking up every single day, and the stress of finances was just really getting me down, she stated. It became so stressful.

Her entire monthly paycheck often went toward credit card payments, leaving her with minimal funds for living expenses. This forced her to rely further on her credit card, perpetuating a continuous loop of debt.

She attempted various methods to increase her income, including summer tutoring, selling personal items, and donating plasma, but these efforts proved insufficient to sustain her spending habits.

A significant turning point came with a tax refund, which allowed her to clear her credit card balance without dipping into her active paycheck. This enabled a fresh start. It took a total restart and being tired of the cycle I was in, in order to do something about it, she explained.

Strategies for Mindful Spending

Young adults are particularly vulnerable to overspending, especially when influenced by online content or distressing news. Overwhelming emotions can trigger unhealthy spending patterns as a coping mechanism, according to Ylva Baeckström, a senior lecturer in finance at King’s Business School.

Personal finance expert Keith Barron suggests a simple yet effective strategy: one of the biggest things you can do is take a beat. Instead of completing an online purchase immediately, he recommends adding items to a wish list and waiting a day or two. This brief pause can help discern genuine needs from impulse wants.

According to the U.S. Bureau of Labor Statistics, the average annual salary for elementary and middle school teachers in the U.S. was approximately $67,000 as of May 2023, highlighting the importance of effective financial management for educators nationwide.

New Habits, New Income

Today, Baker is focused on building an emergency fund and saving for a home, making more deliberate spending choices.

Beyond curbing impulsive purchases, she has cultivated money-saving alternatives that have evolved into fulfilling hobbies. These include making lattes at home, meal prepping, and painting her own nails.

Baker also launched a side hustle on TikTok, creating videos about her life as a teacher. This endeavor generates up to $2,000 per month, demonstrating how a shift in mindset can lead to both financial improvement and personal enrichment.