In 2016, the average student loan debt owed by recent college graduates was $37,700.
According to the Consumer Financial Protection Bureau, when adjusting for inflation, average total student loan debt has increased by an alarming 49 percent over the last 10 years. This debt can feel paralyzing to those in education where salaries generally are lower than those in the private sector.
As student debt grows, student loan payments will consume an increasing share of teachers’ discretionary income. Often times career advancement usually is tied to obtaining an advanced degree teachers must finance on their own. Nearly 80 percent of districts in Texas pay more money to teachers with master’s degree, according to the 2017–2018 TASB Salary Survey, and master’s degrees are required for most higher-level jobs in the educator career path.
There are several loan repayment and forgiveness programs designed to encourage college graduates to pursue careers in teaching. Approximately 32 million Americans could qualify for the Public Service Loan Forgiveness (PSLF) program, yet only 500,000 are currently taking advantage of these programs.
The PSLF program forgives the remaining balance on Direct Loans after teachers make 120 qualifying monthly payments. According to the Federal Student Aid website, a qualifying monthly payment is made:
after October 1, 2007
under a qualifying repayment plan
for the full amount due as shown on the bill
no later than 15 days after the due date
while the employee is working full-time for a qualifying employer
To enroll in the program, employees must complete and submit the Employment Certification for Public Service Loan Forgiveness form (Employment Certification form) annually or when they change employers. District HR staff must certify the teacher’s employment before the teacher can mail or fax it in to the U.S. Department of Education for review.
Helping employees navigate this program could be invaluable for recruitment and retention. This program isn’t exclusive to teachers, either. Any school district employee who works at least 30 hours per week could qualify for the program. Even parents who have taken out loans for their children’s education could qualify.
With so many teachers burdened by student loan debt, it’s important for district HR staff to make sure its employees are aware of this program. Periodically sending out an email or posting reminders on the district intranet with brief instructions on how to enroll in the program is a great way to help out staff and effectively reduce some of the turnover caused by financial distress.