In recent years, the United Methodist church has been fretting over the age of its clergy and endeavoring to recruit younger ministers. It has been a big problem saddling ministers with 60,000 in student debt and then sending them to make 32,000-35,000 a year a moving them from place to place reducing the ability of a spouse to work in one place for very long or in their field of training, and therefore making it difficult to make ends meet. It is especially difficult for young clergy with children and no other form of income or assets to support them while they are in seminary and ministry.
The Oklahoma Conference of the United Methodist Church under the leadership of Bishop Hayes has endeavored to help pay some of those loans back and has started a fund which is in its infancy and which may not be fully funded for many years to come. Even though the fund is small right now it was with great leadership insight that our Bishop foresaw this problem and began to address it with real funding.
The news gets better. The federal government recently took over the student loan business and has created several programs that will benefit especially clergy, teachers and others in jobs that will have salaries that will not increase above the rate of inflation with time. The 1st program is called IBR or Income based repayment which is figured off 150% of the poverty line and the amount of household income you have. This program considers how much extra money you have left at the month, given your income and household size, to pay loans instead of what you actually owe. If you file a joint tax return with a spouse then they also consider their applicable federal loans as well. The loan will be forgiven after 10 or 25 years depending on the amount of debt you have (This is in a since the federal government bailout of higher education and public service employes).You probably think this won't apply to you but you will be surprised especially if you live in the Mid-west and in Oklahoma where the cost of living is pretty low. If your spouse makes to much you may consider filing taxes separately to lower your AGI.
The second part of the federal program is called PSLF, Public Service Loan Forgiveness. You probably think this doesn't apply to you if you work for the church right? Wrong; if you "are employed by any nonprofit, tax-exempt 501(c)(3) organization" you can apply after 120 months of payments (10 years) to have your Federal loans forgiven. Churches are almost always 501(c)(3) organizations. The one thing you have to do is to submit your tax info each year to the Federal Loan Department so they can set your payment, and of course don't forget to apply for the PSLF at the end of 10 years.
I really think that this program will be a great benefit to seminaries in the Mid-West especially in my conference for those who are young and who serve as student or local pastors. Thanks to Bishop Hayes our conference will be able to help with pastors who have a higher income and who do not qualify for IBR, but are still saddled with seminary debt. Altogether the excuses for not going to seminary are evaporating. Seminary education just became affordable again.
