Career Selection and Education Cost

The type of career you select, as well as other things related to career choice, can affect how much your college education will cost. When choosing among various types of careers, the student needs to look at the cost of an education. The average level of educational debt for college graduates in Alabama is about $15,901, which may threaten the financial well-being of many graduates. Many college graduates find that their loan payments are so large that they must delay large purchases, such as a new car or a house.

A good example of this is the decision to become a teacher. Teachers earn much less than they should, considering their high value to society, so debt relief is a necessity to attract good teachers. Under the College Cost Reduction and Access Act of 2007, Section 104, the Teacher Education Assistance for College and Higher Education (TEACH) grant program provides up to $4,000 a year in grant aid to undergraduate and graduate students and those enrolled in a post-baccalaureate teacher credential program.

To qualify for a TEACH grant, students are required to work as full-time teachers for a minimum of four years. Students must complete their service to the TEACH grant within eight years of obtaining an education degree. In addition, students must agree to teach in areas such as math, science, foreign languages, special education, developmental reading, or a subject designated as high need by the federal or state government or by a local education agency. The chief administrator of the student’s place of employment must provide the National Association of Student Financial Aid Administrators proof of grant compliance each school year.

If you do not meet your TEACH obligation, your grant will be changed to a Direct Unsubsidized Loan. With an unsubsidized loan, the student is responsible for the money borrowed and interest owed. However, a subsidized loan means that the government pays the interest while the student is in school, during an economic hardship such as unemployment, or in active military duty. The school you attend sets the amount you can borrow for both types of loans.

Another teacher-specific program is the Teacher Loan Forgiveness Program. Once a person has taught for five years in a row in certain schools or educational agencies, he or she can qualify for up to $17,500 of loan forgiveness for certain types of loans. Additionally, teachers serving in low-income schools, special education, or in a subject shortage area can apply for complete loan cancellation (discharge) of Federal Perkins Loans.

People who choose to work in public service field job such as a teacher or public defender, can qualify for Public Service Loan Forgiveness. Participants must have a qualifying repayment plan and can apply for loan forgiveness after making 120 payments toward loans. Another option is income-driven repayment plans for federal student loans. To be eligible the applicant’s student loan debt must be higher than his or her annual income or be a significant portion of his or her annual income.

In addition, individuals who decide to teach may want to consider teaching specific courses related to science, technology, engineering, and mathematics (STEM). Many states, including Alabama, are providing loan reimbursement for tuition paid for undergraduate courses through the Teacher Loan Forgiveness Program.

Nurses can also qualify for loan repayment programs through Nurse Corps by working full time in facilities such as public and educational hospitals and long-term care facilities. There are also Nursing Education Scholarships for Alabama residents and for students seeking a bachelor of science degree in nursing at Auburn University. Contact the University Scholarship office at (334) 844-4723 for more details.

Most loan forgiveness or cancellation programs require that the loans be federal loans rather than private educational loans. Contact the offices that administer all of the programs mentioned to find out if your loans are eligible.