Margie Patterson, a special education teacher, retired drowning in student loans at the age of 60. “You’re out of here. This is how retirement is supposed to be,” she muses, but the reality is far from it. Instead of enjoying her golden years, she’s gearing up to go back to work. “I just can’t afford to take that break,” she laments.
The Student Loan Debt
Margie is not alone in her struggle. About half of all educators have taken out student loans to fund their schooling, with outstanding balances averaging $58,700. Alarmingly, one in eight owes $105,000 or more, highlighting the pervasive issue of student debt among teachers.
Margie recalls, “I think I was about 38 or 39 when I went back to school for my master’s in special education. I didn’t have the money on hand to pay for my master’s degree, so I started taking out loans.” She borrowed about $80,000 to fund her education and has been making monthly payments throughout her 23-year teaching career. Despite these payments, her balance grew, standing at over $100,000 when she retired.
Why Is Student Debt So Common Among Teachers?
Several factors contribute to the high student debt among teachers:
- Graduate Degree Requirements: To increase their pay, teachers often need a graduate degree.
- Rising Tuition Costs: Tuition for graduate programs has increased significantly, more so than for undergraduate programs.
- Graduate Degree Borrowing: Graduate degree borrowing constitutes a significant portion of student debt, contributing to the $1.7 trillion student loan debt balance in the United States.
The Financial Trade-off
Earning a master’s did help Margie earn more pay, about $15,000 more on the pay scale. However, she notes, “When you are in a contract with a district, once you reach that top step, that’s it. I sat at the same pay for like seven years.” It’s well known that teachers are underpaid, with estimates suggesting they earn between 5% and 20% less than similarly educated peers. This disparity means loan balances shrink at a slower rate, often extending payoffs to 20-25 years, especially under income-based repayment plans.
Hopes Dashed: Teacher Loan Forgiveness Program
Margie had hoped to qualify for the Teacher Loan Forgiveness Program, which can wipe away $17,500 in loans for each school year worked in a low-income community for five consecutive years. Despite meeting these requirements, her application was denied due to a stipulation: any loan taken out prior to 1998 disqualifies the borrower. “I covered all my bases, but just one stipulation disqualified me. It’s so unfair,” Margie expresses with frustration.
Turning to Public Service Loan Forgiveness (PSLF)
Margie now plans to apply for the Public Service Loan Forgiveness (PSLF) program, which offers loan forgiveness for those working in the public or non-profit sector after 10 years of income-based repayments. Though generous in theory, the program is riddled with issues, boasting a 99% rejection rate in 2020 (94% in prior years). Margie still needs to make 92 of the required 120 payments, equating to eight more years of payments.
The Pandemic Pause and What Lies Ahead
As teachers return to classrooms, the end of the pandemic freeze on payments looms, meaning teachers like Margie must resume repaying their student loans. Reflecting on her sacrifices, she asks, “I risked my life for a whole school year to teach. I had students online and in front of me every day. Why am I still paying student loans?”
Margie’s story underscores a significant issue facing educators: the crushing burden of student debt. For many, the promise of a fulfilling retirement remains out of reach, overshadowed by the relentless demands of loan repayments.