Right let’s talk money.
Whatever reason you're doing TEFL, the money's going to be important, even if you're volunteering and you just need to work out expenses on the side for a couple months. We'll tackle the subject of money and all the questions it raises, like how much can you save, what will you earn etc. in two chunks.
- We'll look at all the parts of a job package and how it effects the money we earn.
- We'll look at sample budgets to get actual numbers for how much you can save and earn.
Let's jump into the job package starting off with salary.
The big one. The more you get paid obviously the better.
So where are you going to get the best salary? How do you get the best salary?
Unfortunately it’s going to change wildly depending on your qualifications and across countries. At this point it's a very tricky thing to quantify because there are simply so many variations and data on how qualifications change salary is pretty thin on the ground at the moment.
It is however possible to make some generalizations across countries which we did here:
ESL Teacher Salaries
This post ranks the average salaries for TEFL teachers by country (entry level positions at private companies) and then ranks them taking into account the standard of living. (It also mentions the budgets we'll come to in a bit.) Click here to read it.
So obviously your salary makes a difference. What other job benefits are going to have an effect on your bank account?
Flying is expensive. If you can avoid it you want your school paying for your flights there and back. Whether they do typically depends on the country. Korea for example nearly always pays for flights where as Japan won’t.
Some common sense comes into this, for example, bigger companies are obviously a better bet, but to be 100% sure you'll need to check the job adverts. It's rare an advert won't mention paid airfare if it's being offered.
Important questions to ask:
- Will they pay for the airfare?
- How will they pay. Will it be up front or at some point in the contract? Will they give you money or pre-buy plane tickets?
- What is the limit on the airfare allowance?
- If your ticket is less than the allowance, do you get to keep the rest?
Housing will often be your biggest expense, it's a great place to save money. One of the reasons why teachers can save so much in places like South Korea or Saudi Arabia, is that the housing is nearly always paid for.
How it's dealt with (paid, not paid, allowance etc.) depends on the country and who you’re applying to. (Look at the Accommodation section in the country profiles).
Let’s jump straight into what you should ask your employer about housing and money.
(This list is not exhaustive, there is plenty more you might need to ask about accommodation, these are specifically questions which look at how housing affects your money.)
Important Questions to ask
- What does your company give you in terms of accommodation? Is accommodation fully provided? Are you given a housing allowance to look for your own place or are you just given assistance finding a place?
- Is your apartment shared or is it just you? (i.e. are you going to be splitting bills)
- Is it furnished?
- Who pays the deposit/key money? This and the question above are particularly important. Your house is likely to be your largest settling in cost and if you don't often have the money up front, it can end up coming out of your salary for a couple months.
- If the housing isn't provided, what kind of the assistance is given? Recommended landlords/estate agents? Will someone help translate for you when hunting for an apartment?
- If you have to conduct the apartment search, do you get time off to do it? Will they give you housing while you search or will you need to stay in a hotel or hostel?
Understanding tax is important. You might have tax to pay at home, tax to pay in the country you move to or both. Unfortunately not understanding isn't an excuse. Plus if you know your tax then you can work out a more accurate budget, make sure you’re being paid correctly and know how much you’ll be getting paid each month before you get there.
An Expat Tax Primer
Because tax is such a large area we have a separate expat tax primer to get you started on how tax works when your teaching abroad. Click here to read it.
This is a smaller benefit but still important. In short, you need to know whether or not you’re entitled to national health insurance in the country you’re moving to and what it covers. This is covered in the country profiles.
You'll also need all the other kinds of insurance like travel insurance etc. however countries won't provide these so you'll have to get them yourself.
For most people this might sound a little weird? Why would you worry about pensions?
Well just like insurance, it isn't super important but it can still make you some money.
The three important things you need to know are:
- Do you have to have a pension? (or is an option?)
- Does your employer have to pay money into it?
- What can you do it with it when you leave? (i.e. can you take it with you as a cash withdrawal).
This is country specific and you'll find more detail in the country profiles.
The first question is usually quite easy to answer. If the answer is yes, then the answer to the second question is usually yes. The third question will depend on your nationality, different countries have different agreements on how they deal with pensions.
The reason you'd want a pension is if you can withdraw the money as a lump sum when you leave.
To give an example: if you teach in Korea or Japan, then depending on your nationality you can often withdraw your pension as a lump sum whenever you decide to quit. Because you’re employer has been doubling the 5% or so you pay in a month, this actually ends up as quite a large bonus at the end.
Onto the budgets. If you read the salary blog post, you’ll have seen them there.
As you've probably gathered from reading so far, a huge amount varies from person to person, working out how much you’ll make or how much you’ll be able to save is very difficult without going into a lot of detail.
So let’s go into a lot of detail.
How to view an example budget for your country
- Download the Google docs spreadsheet. Go to File -> Download As.
- Open it up on your computer, in a spreadsheet program like Excel (Open Office has a free version). Fill in the yellow boxes and the spreadsheet will calculate the rest.
- All of the important numbers, like salary after tax etc. are in purple.
- If you don't agree with the numbers, feel free to change anything which isn't a formula. Usually that's anything to do with tax or rent.
The defaults for the budgets such as the salary, whether the airfare is paid or not etc. are set to the standard in the country. So in the Korean budget, rent is set to 0 and airfare is paid, because this is true of nearly all TEFL/ESL jobs in Korea.
I've found the currency formatting is sometimes lost when the spreadsheets are downloaded. Each budget's currency is in the countries native currency, you can either add it back in or just pretend it's there.
Make your own budget
If you want to make your own budget, download the spreadsheet as before, open the second page of the spreadsheet and fill in all the yellow cells. The formula’s will calculate the tax and everything else.
- TEFL/ESL Teacher Budget for Vietnam
- TEFL/ESL Teacher Budget for China
- TEFL/ESL Teacher Budget for Korea
- TEFL/ESL Teacher Budget for Japan
- TEFL/ESL Teacher Budget for Taiwan
Budgets and prices from the blogs
There are also some excellent blog posts or forum threads which give expat budgets for different countries and can help you get a handle on it.
Here are the best ones I've found sorted by country.
China Budget Information
A brilliant post by the couple who runs Middle Kingdom Life. They give their monthly budget/spending for a couple living in Beijing. They both have full time jobs so their standard of living might be higher than the usual ESL teacher, but it’s a great start. Even better they update it every year. Click here to read it.
Korea Budget Information
Audrey is a full time travel blogger, she also taught TEFL and this is a really nice breakdown of monthly spending. She only budgets for two meals a day, so those of us who eat a little more might need to increase her food budget a little. Click here to read it.
Waygook is a really good forum for all things Korea and teaching. It has an excellent thread with a poll on how much people save each month. A lot of great budget information. I've linked to page 12 as that's where the 2013 discussion starts (about halfway down). Click here to read it.
Not as indepth as the other two, (and thus the reason it's last), however it still has a reasonable number of useful figures that you can use to set a baseline. Click here to read it.
Saudi Arabia Budget Information
I'm not sure who writes this blog, the author is only listed as Desert Blogger, but they have a bunch of really informative posts on basic stuff in Saudi Arabia, like renting a house, budgets etc. This particular post is for budgets. Click here to read it.
Linda and David write the Delicious Day. They interviewed a Saudi Arabian TEFL teacher for this article and although it's not a list of numbers there's loads of information on costs as well as a really honest take on living in Saudi Arabia. Click here to read it.
Again not the most granular level of detail but this now dead blog, ESL Teacher Travel, provided some more estimates of what it costs to live in Saudi Arabia. Like the others there are few expenses apart from food. Click here to read it.
Spain Budget Information
Information was a bit thin on the ground for Spain. Although this post lacks some of the finer details it has some useful overall numbers. Click here to read it.
Japan Budget Information
Gaijin Pot is a great place to go for information on Japan. It's forums are great and this is a useful thread on how a basic private school (Eikaiwa) salary might end up breaking down. Click here to read it.
Taiwan Budget Information
Although this blog has stopped recently, it's a really useful resource on Taiwan and this post on the cost of living in Taiwan is great, loads of detail on individual prices and a monthly budget. Click here to read it.
This is a great post by a blogger named Joseph Fritz. It's got a great amount of detail as well as a lot of notes on how he spends his money. Click here to read it.
Vietnam Budget Information
The Saigonist has good stuff on Vietnam and tech, although there's not been any updates for awhile. This post on budget is a little old (2012) but still good. Some of the prices it quotes for food seem a little on the cheap side in my experience, but travelling as a tourist and living are very different things. Click here to read it.
UAE (Dubai) Budget Information
The expat forum's are a little frustrating to search, but it's well worth it because there are some gems of useful information buried in there. This first thread is a sample budget from 2012 and has a good amount of detail. Click here to read it.
This link is also to the expat forum, the thread is more recent from late 2013 and again it's got a pretty good example monthly budget breakdown. Click here to read it.