Visiting a local farmers market is a favorite summer activity for many. While there, you’ll probably think about what in-season produce or fresh meat to buy. But the farmers themselves may have a more surprising topic on their minds: student loan debt.
According to a survey conducted by the National Young Farmers Coalition, young farmers owe an average of $35,000 in student loans. So while many farmers go to college to keep up with the latest scientific trends, the debt they accrue makes it harder for them to put that knowledge to use after graduating.
These debt levels are roughly the same as most new grads. However, young farmers stand to earn much less money initially than their classmates. The National Association of Colleges and Employers reported an average starting salary of $52,569 for the class of 2016. The average salary for all farmers is significantly lower — a reported $39,332 per year, with entry-level farmers making 16 percent less than the average, according to PayScale.
[Check out careers that offer student loan forgiveness.]
Based on this information, it’s no surprise that the coalition also reports that 53 percent of farmers have a hard time making their student loan payments. In addition, 30 percent have put off full-time farming careers because of their debt.
Like other borrowers, farmers have ways to make loan repayment more manageable. Most notably, if they’ve borrowed federal student loans, farmers can take advantage of income-driven repayment options. Under one of these plans, a farmer could decrease his or her monthly payments to zero dollars if he or she borrowed $35,000 and earned $39,000 a year, pending a few other criteria.
After 20 or 25 years and 240 or 300 payments, depending on which income-driven repayment plan the farmer qualifies for, his or her remaining loan balance would be forgiven. That forgiven amount would be taxable, though, potentially still leaving farmers with a large bill to pay.
The Public Service Loan Forgiveness program forgives student loans faster than income-driven plans — in just 10 years and 120 payments — and does not tax the forgiven amount. This program was created to give individuals an incentive to enter necessary, but potentially low-paying, public service fields.
[Understand four income-driven student loan repayment plans.]
Some would argue that is an apt description for farmers. But while there’s been some debate about who qualifies for this plan, it’s clear that farmers currently do not. That could change in the future, though, thanks to legislation reintroduced this past February.
Originally introduced in 2015, the Young Farmers Success Act is a bipartisan bill that would classify full-time positions on farms and ranches as public service jobs. As a result, these workers’ federal student loans would become eligible for public service loan forgiveness. To qualify, a worker’s farm or ranch would also have to earn a certain amount of gross revenue from the sale of agricultural products each year. For 2017, that amount would be $35,000.
[Explore additional methods of student loan forgiveness.]
For farmers and their advocates, the appeal of this bill is clear. However, its potential roadblocks are, too.
The current administration has the elimination of public service loan forgiveness in its crosshairs. While the Student Loan Ranger doubts that will occur, the program is much more likely to be reduced than augmented.
Since critics already find the program expensive, extending its benefits to more borrowers could be a tough sell. The U.S. Department of Agriculture census listed 3.2 million farmers in the U.S. in 2012 — though how many of them would join the reported 33 million workers already eligible for this program is unclear.
At the state level, at least one program exists for farmers that can reduce their debt burden. New York offers the New York State Young Farmers Loan Forgiveness Incentive Program. This provides up to $10,000 per year toward eligible farmers’ student loans in exchange for agreeing to operate a farm in the state full time for five years.
With the federal government’s current education agenda, pushing for more statewide legislation may represent a more viable path forward for farmers to gain loan forgiveness. But either way, the next step for those interested in or worried about the future of farmers is to get involved.
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Growing Movement Seeks Student Loan Forgiveness for Farmers originally appeared on usnews.com
