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The Financial Crossroad of Teacher Education

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Administrators and faculty of educator preparation programs (EPPs) have long been concerned about the challenge of attracting students to a profession where college affordability and financial compensation discourages them from pursuing teaching as a career. However, due to the pandemic, the concern is growing. Our nation’s educational system is at a critical crossroad where teacher shortages and budget cuts are colliding. On one hand we have teachers who are retiring early amid health concerns or being furloughed, and on the other hand, we have EPPs with shrinking programs and enrollment. This is the perfect storm many education leaders have feared, and the impact will be acute if we do not find ways to encourage diverse and talented students to enter a career in education.

To start, we need to address the financial challenges that future educators face, including a high student loan debt to earnings ratio and lack of awareness of scholarships and loan forgiveness at the federal, state, and university levels. Recently, the American Association of Colleges for Teacher Education (AACTE) released the Issue Brief, How Do Education Students Pay for College?, based upon data from the 2015-16 National Postsecondary Student Aid Study (NPSAS). According to the data, by the time education students graduate, 76% of them have taken student loans, and the average amount they borrow is nearly $28,000.

It’s no secret that education majors in an undergraduate program earn less over a lifetime than those with Bachelor of Arts degrees in other majors, leaving teachers with a higher debt to earnings ratio than their peers. In fact, according to AACTE’s report, estimated payments on the average amount education students borrow is equivalent to 9% of the average starting teacher salary, which is above the 7% threshold recommended by economists as affordable for borrowers at that income level.

There is a great deal of work to be done, federally and institutionally, to make education programs more affordable for those entering college.

On the federal side, education policies need to be strengthened. The Public Service Loan Forgiveness Program and the Stafford Loan Forgiveness Program need to be expanded, and the Loan Forgiveness Program for Service in Areas of National Need must be funded. Additionally, the Teacher Education Assistance for College and Higher Education (TEACH) Grant Program needs to be improved by increasing the stipend amount and converting grants to interest-bearing loans only when a recipient can no longer complete their service obligation.

The TEACH Grant is a drastically underutilized program. While it’s estimated that between 15% and 20% of education majors would qualify for the grant, only 2% of education majors received funding from the program. Why? The TEACH Grant is unique from other federal grants because it requires education students in high-need fields to complete four years of teaching in an area low-income school; otherwise, the grant converts to a loan. The program has been plagued by federal administration issues, creating huge obstacles to the end-user and faulty grant conversions to loans. With this in mind, many financial aid offices, that typically only administer either grants or loans, are hesitant to package the niche grant due to its complicated and stringent requirements. However, the TEACH Grant is a very promising tool for recruiting education students in high-need areas.

For recruitment, retention and the good of the education profession, it’s really incumbent on colleges of education to partner with their financial aid offices to help education students with financing not only before they enter the program but also during and after their time at the institution.

To ensure that teacher candidates are aware of all the financial aid programs for which they may be eligible, colleges of education need to adopt the recruitment strategy that law and medical schools have embraced—talking to students about financing early, often, and post-graduation. EPPs need to build strong relationships between its school, college, or department of education, and the institution’s financial aid office, and have dedicated personnel who become experts in these programs.

To start, they need to recruit high school students by letting them know that through scholarships a career in education can be affordable. Then, they need to provide interested students with financial counseling and make them aware of any obligations that are attached to the funding. Throughout the course of the student’s time at the university and post-graduation, the financial aid office needs to continue to provide guidance and support.

Education students are borrowing quite a bit, especially students of color. If we want to build our teacher workforce and diversify the field, it is absolutely essential that schools of education help students navigate finances.

Jacqueline E. King serves as an AACTE consultant and is the author of Colleges of Education: A National Portrait (American Association of Colleges for Teacher Education, 2018) and of several AACTE issue briefs. Jane West is the former senior vice president of policy, programs and professional issues for AACTE and currently serves as a consultant on the Research, Policy and Advocacy team.


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Jacqueline E. King, Ph.D.

AACTE Consultant

Jane E. West

AACTE Education Policy Consultant