DEBT FOLLOWS SEMINARIANS INTO CONGREGATIONS
from Concordia Seminary, Winter 2003 (PDF).
It’s a joyous occasion for seminarians when they receive their first calls and transition from student to graduate to pastor.
Yet a shadow follows three out of four new pastors as they begin their ministries: It’s also time to begin paying their student loans. That shadow of education-related debt sometimes goes undisclosed by pastors so their congregations remain unaware and unable to help.
Loans, mostly backed by the U.S. Department of Education, are not inherently bad. They enable seminarians, like college and university students throughout the nation, to progress through their educations. Nationally, two out of three students borrow money to attend a college or university.
But student debt for future pastors is a concern, not only among Seminary staff, but also among leaders at national, district, and congregational ranks of The Lutheran Church—Missouri Synod (LCMS). Many factors play into the mix: the rising expenses of higher education; the evolving way in which the Synod funds its seminaries and colleges; more students who are married with families; and a system that pays modest salaries to graduate-trained workers.
At the end of the day, when pastors have significant debt loads, it can become a hindrance to ministry that affects not only pastors and their families, but whole congregations.
Understanding the numbers
Here’s a quick picture from the 2011-2012 academic year at Concordia Seminary: New pastors left the campus with an average education-related debt of $28,902. About 16 percent had no education-related debt; of those who graduated with educational debt the average amount was $34,000.
Tuition is not the only expense a man might incur during the eight years of post-high school education most pastors receive on the path to ordination. Factor in undergraduate student loans, personal debt such as auto loans and credit cards, and education-related debt that a seminarian’s wife may have incurred, and the total debt a pastor takes to the parish can be much more. Estimates among current seminarian households are that half will leave with an average of $39,000 in debt, and a quarter will owe $80,000 or more.
Noting that the annual salary for a first-year, first-call pastor may be $44,000 (Based on the average cash salary of 78 full-time placements from Concordia Seminary in May 2012), the Rev. Dr. Glen Thomas, executive director of the LCMS Office of Pastoral Education, comments, “One can only imagine what effects debt, coupled with a more modest income, have on a pastor and his family. It can be significant. It can affect longevity in ministry.”
It should be noted that most of the debt that a student incurs is for education-related expenses — books, housing, food, health insurance, transportation — rather than directly for tuition. While exact tuition is based on the number of credits, a full-time load runs about $25,000 for an academic year. Add in basic education-related expenses, and most students have to start with a total annual price tag of $41,000 to $54,000, depending on whether they’re married and whether they take summer classes.
The Seminary responds
No Concordia Seminary Master of Divinity (M.Div.) or deaconess student pays full tuition. The Seminary guarantees a 28 percent tuition grant to every future pastor or deaconess who is a member of an LCMS congregation and enrolled in a residential program.
Based on financial need, additional grants and student aid—not loans—may bring the total support to as much as 45 to 100 percent of tuition, according to Kerry Hallahan, Seminary director of financial aid. The tuition grants come through donations and gifts from individuals, congregations, home districts, and auxiliary groups.
While the national budget of the LCMS provides a small subsidy to both seminaries, Thomas notes, “The route for dollars [from individuals to the Seminary] is different than it was years ago. It no longer goes from individuals to congregations to districts to the national office and then to the seminaries. Now, most dollars [from individuals] go directly to the seminaries or the Joint Seminary Fund,” instead of first passing through the LCMS national office.
He continues, “The people of the Synod continue to be extremely supportive of the two seminaries. In fact, they are doing a marvelous job.”
Immediate support for specific seminarians often comes through the Adopt-A-Student program. This program establishes a personal connection between a donor and an individual student. “I’m hoping to see that program continue to grow because of those relationships,” says Hallahan.
Long-term endowments help even more students. “Concordia Seminary depends on the people of Synod — and always has — to keep the cost of becoming a pastor affordable both for students and for the churches that will call them,” commented The Rev. Ralph Blomenberg, chairman of Concordia Seminary’s Board of Regents. “But donor patterns have changed during my lifetime. The Seminary’s financial situation is now more uncertain year to year than when most support came in through a Synodical subsidy. So a top priority continues to be the growth of our endowments.”
Because tuition is only part of the cost of getting a seminary education, most students end up personally responsible for 50-60% of the total price tag for a year at Concordia Seminary. They must come up with that amount from wages, savings, sometimes selling a house and, for whatever’s left, loans. (See chart, page 5. [above])
“We provide a lot of counsel about the amount they intend to borrow,” Hallahan says. At the graduate level, a student can borrow up to $20,500 a year, although the Seminary recommends only $8,500. “That doesn’t mean they have to borrow even $8,500, however. They can borrow less, they can borrow more depending upon their needs,” she adds. Each time a student borrows, the Financial Aid office sends a sheet showing the aggregate amount and an estimate of monthly repayment as required by the U.S. Department of Education.
“We go through an exit interview when they leave the Seminary, so they get to see all the different repayment options,” Hallahan says. “There are actually five different repayment options for the student loans,” she adds, noting that one option adjusts the payments based on income.
While he counsels potential students to be realistic about the expense to attend the Seminary, Admissions Director Rev. William Wrede says the seminary process requires faith that it will be God-blessed and God-directed. “And that includes a certain amount of trust that there are incredible things in place, from the base tuition grant to what our districts and congregations provide,” Wrede comments. “Then I always remind them that the Financial Aid office provides a list of places to apply for grants and scholarships.”
Wrede said Admissions does require a financial plan from applicants. They are asked to provide their current family budget situation and a projected budget for their first year at the Seminary. That helps them to consider income sources from savings, part-time employment, and spouse’s employment, as well as discovering expenses they may not have considered, like travel or books.
Based on a look at the current and planned budgets, Wrede says his office has counseled some prospective students to delay their applications until they pay down current consumer or educational debt.
“For a married student who has left a decent income to come to the Seminary, it’s an adjustment,” Hallahan says. “That’s one of the reasons why we incorporate Financial Peace University in order to help students acclimate themselves to being here.”
Financial Peace University is a series of classes offering a Christian perspective on personal financial management. The program uses video presentations, class discussions, and interactive small group activities. Hallahan calls it one way the Seminary tries to combat student debt. “I’ve had students who went through Financial Peace who have told me, ‘Thank you for doing this because I never learned to budget. I never learned how to take care of my finances.’”
Wrede disagrees with those who would appeal to the church worker’s sense of sacrifice as a reason not to be concerned. “Some people try to find a way to not own the high cost of seminary education,” he says. “A lot of time, energy and money went into forming this man who will be installed as pastor of your congregation.”
Districts educate congregations
When congregations in the Missouri District consider calling a seminary candidate, the Rev. Dr. Ray Mirly, district president, intentionally makes them aware of issues they must address.
“It is my practice to make them aware that their new pastor will most likely come with 1) a debt related to his education, 2) a car that probably needs to be replaced, and 3) no money for a down payment on a house,” Mirly comments. “I believe it is important for every congregation calling a new graduate to have this information.” Mirly, who sits on the Seminary’s Board of Regents, refers the leaders to the district salary guidelines and the importance of adequate salaries and fringe benefits for their pastor.
At the LCMS Office of Pastoral Education, Thomas says he is encouraged that some LCMS districts have programs to assist pastors and commissioned workers with the debt they bring to their site of service. He also sees congregations becoming more aware and attempting to assist workers.
“It will be a combination of these types of measures that will bring some sort of relief,” he says. “Unfortunately there is no silver bullet that can take away this issue across the board.”
The next step: more “tactful and loving” conversations
Thomas encourages congregational leaders to have “tactful and loving” conversations with their new seminary-graduate pastors. While some leaders may consider debt questions to be prying into personal business, and pastors may feel embarrassed to talk about debt, Thomas believes the talk is necessary: “Otherwise what happens is that the pastor and his family tend to suffer in silence without anyone being aware of the situation.”
If student debt for seminarians is a problem, whose problem is it?
All of us benefit from having faithful, capable pastors. But who is ultimately responsible to pay for seminary education? The students who discern God’s call? Congregations who need new pastors? Districts and corporate Synod who project future ministry needs? Laypeople who are served by seminary graduates?
This is not a new question. Happily, there is a clear answer. According to the leadership of our church body, all of us who make up the LCMS are responsible (not just the students!).
This clear answer was spelled out in detail by delegates to the 2007 Synodical Convention. There the leaders of the LCMS wrestled with the funding model for seminary education and took a strong stand:
“The LCMS as a whole (individuals, congregations, circuits, districts, corporate Synod, and agencies) assumes primary responsibility for gathering funds to support seminary students and assist them in paying undiscounted tuition.”
Adopted by the 2007 LCMS Synodical Convention Resolution 4-09A: “To Provide Financial Support and Adopt Funding Model for Seminaries”
FOUR FREE THINGS YOU CAN DO IN RESPONSE TO THE CHALLENGE OF STUDENT DEBT FOR PASTORS
The challenge of student debt for pastors is complex. It costs a lot to provide the quality preparation that Lutherans expect their pastors to have. When pastors take debt with them to their congregations, there is no one-size-fits-all cure. Besides sending a monetary gift to Concordia Seminary “for future pastors,” what can one do?
Happily, the next step for most of us can be very simple. Below are four things you can do this week, where you live, without spending a dime. As God leads you, please read them thoughtfully and pick something you’re open to doing.
Pray for Your Pastor
Time required: Minimal
Materials needed: None
Do this if: You have a pastor
Pastoral ministry is the Lord’s work. Anything that gets in the way is not God-pleasing. But pastors are not to “go it alone.” God has designed His Church, the body of Christ, so that we’re dependent on one another. Just as congregations need pastors, pastors desperately need the support and prayers of laypeople.
Student debt is just one of many concerns that can weigh down a pastor. Pray that God sustains your pastor in the face of worries, and specifically that He gives your pastor wisdom in personal financial matters.
Here’s a short prayer list to get you started:
- Thank God that your pastor said yes to God’s call to shepherd your congregation
- Ask God to guard your pastor’s faith and help him to remember that grace and forgiveness are for pastors, too
- Ask God’s mercy that your pastor (and family) not be distracted by the “cares of this world”
- That the Lord would provide your pastor’s daily needs
- That your pastor would be protected from costly crises such as medical emergencies and accidents
- Ask the Holy Spirit to raise up godly laypeople to work with and encourage your pastor
Jot a Note
Time required: 5-10 minutes
Materials needed: See inside back cover
Do this if: You appreciate the value of a personal note
Like most of us, seminary students appreciate encouragement. They don’t look for personal praise, but they deeply value a kind word, reminding them that the Church looks forward to the service for which they are joyfully preparing and sacrificing.
Many people would be willing to send a note of encouragement to a future pastor, but they just don’t know a seminarian personally.
So, we’ve made it easy. If you’re open to jotting a quick note, you can use the “notecard” on the inside back cover of this magazine. Tear off the page and mail it to Concordia Seminary.
If you prefer, you can email your message to [email protected]
Your note doesn’t need to be fancy or long: a simple sentence or two would mean a great deal. Your words of encouragement will be individually delivered to a future pastor being formed for ministry at Concordia Seminary. It’s a simple way for you to participate in “Life Together” with one of our students. It costs you nothing and will brighten his day.
Talk with Your Pastor
Time required: 3-5 minutes
Materials needed: None
Do this if: You deeply respect your pastor
This isn’t for everyone, but for some readers this could be the most important response they choose. We picked this idea up from alumni (that is, pastors) who overcame major financial hardships.
When a pastor is distracted by debt, there usually isn’t a magic fix. Often, the congregation is also struggling. But pastors consistently report that simply getting the topic out in the open with one or more lay leaders — confidentially in a context of mutual respect — immediately reduces the distraction factor. Although the debt usually remains unchanged, pastors say this openness allows them to focus better on their ministry.
How do lay leaders begin this sort of discussion with their pastor? It varies case by case. Here’s an example:
“Hey, Pastor, I’ve learned that a lot of pastors leave seminary with considerable debt. Apparently for some, debt remains a big stress for years.
“I don’t know if that applies to you, or if you have other financial concerns, and I’m not asking you to tell me.
“But I want you to know that, if you ever did have distracting levels of financial concerns…
- “I’d still be really glad you’re my pastor
- “I’d hope you’d let someone in leadership in our congregation know. I don’t know what we’d be able to do, but—just as you’re always there for us—we’d want the opportunity to support you in any way we could.”
Time required: Variable
Materials needed: See inside back cover
Do this if: You’re open to learning more about this issue
If you’re thinking about this topic for the first time, you may have many unanswered questions.
On your own, you may want to find out:
- How did your pastor make ends meet during his seminary years? Is he still paying off education-related loans?
- Are any men from your congregation currently preparing to be pastors?
- How much financial support does your district offer to men going into the Holy Ministry?
- Has your congregation “adopted” a seminary student?
From Concordia Seminary, you may be interested in:
- Stories about future pastors (and their families)
- Having a future pastor visit your congregation
- How God leads people to the Seminary
- How to put Concordia Seminary in your will or estate plan
- President Dale Meyer’s quarterly update letter on the Seminary’s mission and vision
- News updates on the Seminary by email
- How to visit campus
- The process for calling a new pastor to your congregation
See the inside back cover to request any of the above and more.