Virtuous Cycles: Supporting Future Ministers

In 2013, Lilly Endowment launched an initiative to find solutions to worrisome trends around student debt and the financial challenges of ministry. Coordinated by the Association of Theological Schools (ATS), “Economic Challenges Facing Future Ministers” (ECFFM) began as a three-year project involving 16 theological schools. It has since expanded to 67 schools in 27 states and 27 denominations, reaching more than 17,500 students.

The project’s findings have confirmed many of our assumptions about educational debt, but we have also learned new things that are now shaping best practices and research on the challenges of theological education, ministry, and finance. The hope is to create pathways for future ministers to pursue seminary in fiscally sustainable ways so they can lead congregations without financial strain.

When ECFFM got started, we knew educational debt levels among divinity graduates had been steadily rising over the last decade. The initiative allowed us to look more closely at the details.

Startling Stats

What initially surprised us was the large number of students – in 2016, almost half (46 percent) of graduates from ATS schools – who were not incurring any new educational debt in seminary. However, the other segment of graduates – 54 percent – took on nearly $37,000 in educational debt on average, up significantly from about $20,000 in 2006. As we learned, the number of students borrowing is not increasing, but the amount they are borrowing is climbing significantly.

Educational debt does not affect everyone in the same way.

• 82 percent of Black/Non-Hispanic students* graduated with new educational debt incurred in seminary; the average amount among these borrowers was over $46,000.
• Female students were just as likely as male students to bring debt with them to seminary. However, 58 percent of female students took out new educational loans in seminary, compared to 50 percent of male students, and the average debt incurred was higher ($39,000 vs. $35,000).
• Younger students, who have not had as much time to pay off undergraduate loans, are more likely to incur debt in seminary (57 percent, compared to 49 percent of those over 50 years old).

We expected younger students to take out more educational debt during seminary. What surprised and worried us was the amount of debt being incurred by older students. Though students over 50 were less likely to take on educational debt during seminary, they were more likely to borrow $60,000 or more (14 percent of them vs. 8 percent of students in their 20s). With fewer years in the workforce to pay off their debt and with the struggle, for some, to find work in churches that pays enough to make debt payments, older students run the risk of defaulting on their loans, which can hurt their Social Security benefits if the lender is the federal government.

Many explanations are offered for today’s high levels of educational debt. Some people blame the rising cost of tuition in theological schools. Overall net tuition at ATS schools increased by approximately 50 percent between 2004 and 2014, significantly outpacing inflation rates. However, when ATS compared net tuition at member schools with the average amount of educational debt incurred by graduates, we found no correlation. Net tuition at an individual institution did not predict debt levels. There were institutions where students received full-tuition scholarships yet these students still incurred high levels of debt, and schools where students faced relatively high tuition rates and still graduated with little or no debt.

Tuition certainly contributes to educational debt levels, and many schools are exploring ways to lower tuition costs. Some schools are reducing the required credit hours for degrees, others are creating advanced standing programs (which allow credits for undergraduate religion courses) or accelerated bachelor’s-to-master’s degree programs. Others are starting new capital campaigns to increase scholarships, or examining their own administrative structures for ways to be more efficient in their work. All of these efforts contribute to lowering the cost of theological school.

However, the lack of correlation between tuition and educational debt levels suggests other factors are also fueling the problem. These include high living expenses, poor lifestyle choices, a decrease in congregational or denominational financial support for students, lower wages for part-time jobs, and an increase in undergraduate debt brought to seminary.

Wiser Choices

The ECFFM project has seen early successes in the form of interventions to help students make wise choices. Schools have partnered with financial literacy organizations, local financial advisors, business schools, and denominational pension boards to create workshops, courses, online training, and mentoring programs. These have been most successful with students who have low levels of debt. Such programs have had more difficulty reaching high-debt students.

Indeed, many schools have been frustrated with the overall lack of participation by students in programs that aim to help them incur less debt. In some institutions, students resisted because financial counselors and teachers lacked theological training, brought a different theological perspective, or did not seem to understand the specifics of clergy finances.

More often, though, schools suggested the resistance was caused by social and psychological factors associated with contemporary society’s “code of silence” around money, a culture of blame and shame around issues of debt.

Blame and Shame

Thus, in many cases, students were unwilling to come forward and ask for help when they were struggling financially. It was easier to take out another loan than try to address their financial issues or ask people to support them as they prepared for ministry. Many were ashamed of the debt they carried, even if their struggles were related to circumstances outside of their control. A widespread culture of blame in society intensifies a tendency to regard theological education as a private affair to be financed by individual students rather than as a responsibility shared by the congregations and denominations that called them to seminary. If students incurred high debt, it’s their own fault.

It is true that some students make bad financial choices or spend extravagantly on things they can’t afford. But our data shows that students today can work just as hard as students a generation ago, make the same prudent spending choices, and still end up with high levels of debt. And sometimes they are doing exactly what they are supposed to do – yet still they are saddled with more debt.

I must admit my own resistance to the blame language associated with educational debt. This is partly based on my own experience. When I was pursuing my M.Div., I had several seminaries to choose from. I ended up picking an expensive residential seminary that offered very few scholarships to students. Why? Yes, I loved the campus, but more importantly it was the one most of my mentors recommended. There were no conversations during my discernment about the cost of seminary or how I was going to finance it. The congregation I was serving as an intern did its best to support me. The junior high girls I worked with sold donuts and coffee on Sunday mornings for a month to raise funds. In the end, they sent me off with 300 one dollar bills safety-pinned to a green T-shirt – a gracious gift that didn’t even cover tuition for a single course. During the first year of seminary I lived in a tiny dorm room just big enough for my bed, a desk, and a small dresser. I ate in the cafeteria. Didn’t go out to movies or concerts. I missed the weddings of many friends across the country because I was trying to make wise budgetary choices. I took a full course load and worked several days a week as a nanny. When a TA position opened up, I did that as well. I spent the summers taking temp positions at local businesses. I did everything I was supposed to do to save money … and graduated with $30,000 in educational loans.

Overcoming Rhetoric

During the first years of the ECFFM initiative, many schools themselves had to work hard to overcome the rhetoric of shame and blame associated with educational debt. Soon we changed the language we used in ECFFM procedures – shifting from a focus on seminary student responsibility to a broader emphasis on systemic issues that contribute to the high debt loads on individuals.

This shift was important not just for students but for relationships with congregations and denominations. A focus on the systemic issues allowed all parties to come together without blaming any one player, whether seminary or congregation or student. It’s crucial that all involved get to work on the common problem of how to equip individuals whom congregations and denominations call into service.

In that spirit, several seminaries have shifted their financial aid approach from a “procedural” to a “relational” strategy where financial aid offices partner more personally with students to provide information and counseling that will help them make the best possible choices to get through seminary with manageable debt loads. In some schools this counseling begins with prospective students, giving them a realistic picture of the cost of seminary, their potential future salary, and the options for degrees and funding.

Cycles of Virtue

Several seminaries are going further. Some are working with congregations to find financial support for those in their midst who are discerning a call to ministry. Other schools are training seminary students not just to be financially literate but to be better equipped to lead congregations that are often struggling financially themselves. By training seminarians to be wise financial leaders, developing their skills in business, entrepreneurship, and fundraising, theological schools are creating a virtuous cycle – where financially equipped students create financially stronger congregations who are then able to financially support future ministers.

Through Lilly’s ECFFM initiative in the next few years, ATS will be doing more research on debt factors among seminary students. We’ll be studying best practices that are emerging from the schools and doing targeted research on issues such as debt among Black/Non-Hispanic students, the impact of early financial conversations on admission and retention, and the impact of educational debt on faculty.

Our goal is to help theological schools meet the economic challenges facing their students as they continue their mission to serve communities of faith and the broader public.

Jo Ann Deasy is director of Institutional Initiatives and Student Research at the Association of Theological Schools, where she coordinates the “Economic Challenges Facing Future Ministers” initiative. She is ordained in the Evangelical Covenant Church and has a Ph.D. in congregational studies from Garrett-Evangelical Theological Seminary.