Always opt for 10. If you are on 12, you can see what the district takes out and is making interest on. Many credit unions work with teachers or any bank for that matter, you can self-direct a summer savers savings account and make the interest yourself... My credit union pays 4% for this plan.
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As I teacher I choose to get paid on 10 month instead of 12 and auto-transfer $2000 into a summer saver account which is earning 4%!! If I need it prior, there is NO PENALTY to take it out and I still earn HIGH interest in a regular savings account. Try getting that from ANY CD.
In addition to this savings, What remains goes into my checking account where an additional $100 goes into ING for Christmas, $50 for emergency fund and $50 for general savings. This is all done on a monthly basis. Imagine what I have in my accounts. I'm prepared for most any emergency. : )
Paying off a mortgage faster & saving $$$ on interest
To pay your mortgage faster, some lenders offer an option to pay half payments every 2 wks instead of monthly full payments. (Like making 13 payments/yr.) Do it yourself by paying extra ea month toward the principle. Divide your normal payment by 12 & add that much or more to ea. monthly payment.
Check with your lender about how to submit extra payments. Your mortgage will be paid off faster & you will save thousands in interest over the years. Use an online mortgage calculator to see how much you can save by paying $50, $100 or $200 more ea. month.
If you own a home with sufficient equity, you can save money on higher dollar purchases by establishing an Equity Line of Credit with your home as collateral. Home Equity Loans are Usually at Prime plus 1-2 percent, which right now could mean the interest rate you pay would run about 3%,
significantly lower than any credit card or store credit line. Pay the LOC off quickly by making more than minimum payments. If you think you want to pay off the loan in 12 months, simply divide the total loan by 12 and use that amount to establish YOUR minimum monthly payments.
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