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How Seminaries are Addressing Students’ Ballooning Debt

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Many believe that theological education is in the midst of major transition.

Sitting at the intersection of the church and higher education, both of which are in the midst of significant flux, theological education is seeking out new educational models, new economic models and new organizational models that will help both groups continue to fulfill their mission to serve communities of faith and the broader public.

It is likely that these new models will not just be a response to change but will rather embody change as a new way of being.

There are many issues pushing these changes in theological education but let me focus on one: educational debt.

The Auburn Center for the Study of Theological Education first began to note the rise in educational debt among students at theological schools in the early 1990s.

In 2005, they published a study titled “The Gathering Storm: The Educational Debt of Theological Students,” followed by a 2014 study, “Taming the Tempest: A Team Approach to Reducing and Managing Student Debt.”

Over the last two decades, students are carrying significant debt from their undergraduate degrees and incurring more debt while in graduate theological education, which can impact both their educational experience and their vocational calling.

In 2019, 40% of graduating seminary students still had an average of $33,000 debt from previous academic programs while 45% reported taking on an average of $34,000 in additional debt to fund their seminary education.

Theological schools struggle with how to respond to an issue that began, for some students, years before they even considered attending seminary.

Thankfully, the last three years have seen a significant change in debt among seminary students due, in part, to the Lilly Endowment launching the “Theological Initiative to Address the Economic Challenges Facing Future Ministers” (ECFFM) in 2013.

Eventually expanding to projects at 67 theological schools in the U.S., this initiative was designed to address the issue of student debt through research, education, institutional change and collaboration.

And, if our data is any indication, it is beginning to make an impact. The number of borrowers has decreased by 9%, and the average debt of borrowers has dropped by almost $3,000.

Schools participating in the ECFFM initiative have implemented financial literacy training programs, included financial discernment in admissions processes, embedded financial wellness into formation curriculums, equipped students to raise their own support to fund their theological education and deepened partnerships with denominations that support their graduates.

One of the early victories of the initiative was simply raising awareness about debt and overcoming the culture of silence surrounding money in theological schools and the communities they serve.

Many faculty and administrators believed that if students followed the same pathways to seminary, lived as frugally as they did during seminary and were faithful to seek positions after seminary, then they would be able to graduate without educational debt.

As schools began to take a better look at the debt levels of their students, they found that some of the most faithful and frugal students were still accruing large amounts of debt.

The financial picture of seminary students had shifted.

Networks of support and pipelines to ministry, mostly through congregations and denominations, were not as strong as they used to be.

In addition, many students were coming from outside of these systems, with an increasing number coming from nondenominational or non-churched backgrounds.

It also became clear that larger economic systems were at play in the lives of many students. Economic inequities in our culture were replicated in the debt levels of students.

On average, black students were incurring $9,000 more in educational debt during seminary and bringing more with them from previous degree programs.

Female students were incurring more educational debt than male students, and older students were borrowing just as much as their younger counterparts.

The ECFFM initiative has challenged us to look more deeply at the economics that have shaped us and to develop new economies that reflect our ethical imperatives as Christians to do justice, love mercy and maintain the dignity of all humanity.

At its most basic, it has meant shifting from a language of blame and shame regarding debt to language that believes in the sufficiency of God to provide for all our needs.

In addition to better equipping students financially, theological schools have begun looking at their own financial models.

Spending per student has increased by over 129% in the last 20 years, reaching $53,800 per year in 2018, according to The Association of Theological Schools annual data tables. Tuition has increased by 97% to $7,800.

Alongside these cost increases, giving to theological schools by religious organizations has dropped by 30% to $1,025 per student per year.

Theological schools are responding by increasing fundraising for scholarships, lowering credits required for degrees, partnering with undergraduate institutions to create accelerated degree programs and shifting to online or part-time models, or both, which allow students to remain in their jobs while attending seminary.

One of the most significant things schools are doing is rebuilding networks of support with denominations, local congregations, financial institutions, business schools and others to strengthen the economic ecology of both the institution and the students they serve.

Through this initiative, incremental change is occurring as we shift the needle on educational debt in theological schools.

It has become clear, though, that we are in the midst of a larger adaptive challenge to the fundamental structures of graduate theological education. And this is the work that the Association of Theological Schools will be turning to next.

Our next big initiative, set to launch in 2020, will ask:

  • How do we look at the larger organizational models that shape theological education?
  • How do we bring about long-term change that is both educationally effective and financially sustainable?
  • How do we do so in ways that remain true to our commitment as theological schools to form leaders for communities of faith and the broader public?

Our assumption is that there won’t be a single answer to these questions, but rather multiple models, multiple modes of being that seek to lead us into the next generation of theological education.

Editor’s note: This article is part of a series this week focused on trends and issues in theological education. Previous articles in the series are:

Churches, Pastors Can Access Tailored Theological Education | David Bronkema

Why We Must Rethink Theological Education in Time of Flux | Lina Toth

6 Ways Seminaries Train Church Leaders on Their Home Turfs | William D. Shiell

Serving the 90%: The Challenge Facing Theological Education | Dennis Tucker

Breaking Down Racial Roadblocks in Theological Education | David Cassady

4 Positive Traits When Seminary Education Occurs Online | David Wheeler

Jo Ann Deasy

Jo Ann Deasy, an ordained minister in the Evangelical Covenant Church, is Director of Institutional Initiatives and Student Research at The Association of Theological Schools. She served previously as Dean of Students and Community Life at North Park Theological Seminary in Chicago and completed her PhD in congregation studies from Garrett-Evangelical Theological Seminary.