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Letter to the Editor: A $235,000 Bonus for a Master’s Degree?

On salary increases for teachers who acquire a master's degree.

The following letter to the editor was written in response to the story, .

I would like to address the practice of giving salary increases to teachers who acquire a master’s degree.  Now, studies show that additional education on the part of the teacher does not produce any improvement in student test scores.

In other words, students of teachers without a master’s do just as well as students of teachers who do have a master’s degree.  However, a study should not really be necessary.  It is just common sense that someone who has four years of high school and four years of college should have enough education to teach arithmetic to a ten-year-old. 

Further, it is an open secret that getting a Master’s Degree in Education is not exactly (ahem) difficult.  In some cases it takes little more than $10,000, a few weekends, and an open-book test. Even further, overall student test scores continue to decline though more and more teachers acquire master’s degrees.

Calculations follow – using the assumptions of a 6% average salary increase for teachers, a $10,000 salary increase for a master’s degree,  pensions increasing at 3% per year, a 75% of final salary pension payout, a 5% discount factor for the cost of money, and a life expectancy of 84 years.  All of these assumptions are variable, but they are all “in the ballpark”.

Based upon these assumptions, the calculations that follow show that a $10,000 salary increase to a teacher for acquiring a master’s degree is equivalent to the following:

To a 50 year old teacher: “Now that you have a master’s degree, the School Board will give you a one-time bonus of $168,938 of taxpayer money even though neither the taxpayers nor the students will receive anything in return.”

To a 40 year old teacher: “Now that you have a master’s degree, the School Board will give you a one-time bonus of $235,411 of taxpayer money even though neither the taxpayers nor the students will receive anything in return.”

To the 30 year old teacher: “Now that you have a master’s degree, the School Board will give you a one-time bonus of $289,314 of taxpayer money even though neither the taxpayers nor the students will receive anything in return.”

There are a number of taxpayers who are willing to pay taxes for the education of students. There are a number of taxpayers who are willing to pay taxes so that students can enjoy a wide range of extra-curricular activities in order to broaden their educational experience.  There are few taxpayers who are willing to pay taxes so that a School Board can throw it away. 

Many would consider this type of boondoggle to be a gross breach of fiduciary duty on the part of the School Board –a duty that they owe to the taxpayers and the students.  I hope that School Boards everywhere will immediately stop this ridiculous practice in accordance with the stated goal of  “the development of sound business practices which ensure that every dollar spent produces maximum benefits”.

Master’s at age 50

$10,000 increase for 10 years with 6% raises = $131,808 in additional payments by age 60

$10,000 becomes $17,908 at retirement (6% raises for 10 years compounded)

75% of $17,908 = $13,431 pension increase

At 3% annual pension increases, 24 years = $462,394 in additional pension payments by age 84

$462,394 discounted at 5% for 34 years back to age 50 = $88,019

$131,808 discounted at 5% for 10 years back to age 50 = $80,919

Total present value at age 50 = $168,938                                                       

Master’s at age 40

$10,000 increase for 20 years with 6% raises = $367,856 in additional payments by age 60

$10,000 becomes $32,071 at retirement (6% raises for 20 years compounded)

75% of $32,071 = $24,053 pension increase

At 3% annual pension increases, 24 years = $828,078 in additional payments by age 84

$828,078 discounted at 5% for 44 years back to age 40 =  $96,770

$367,856 discounted at 5% for 20 years back to age 40 =  $138,641

Total present value at age 40 = $235,411                                                      

Masters at age 30

$10,000 increase for 30 years with 6% raises = $790,582 in additional payments by age 60

$10,000 becomes $57,435 at retirement (6% raises for 30 years compounded)

75% of $57,435 = $43,076 pension increase

At 3% annual pension increases, 24 years = $1,482,955 in additional payments by age 84

$1,482,955 discounted at 5% for 54 years back to age 30 = $106,391

$790,582 discounted at 5% for 30 years back to age 30 =     $182,923

Total present value at age 30 = $289,314              

—John Sullivan, brother of resident                                     

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Danni April 15, 2012 at 05:36 PM
Brogan-full of the chat-10 year old study
John Sullivan April 16, 2012 at 01:35 PM
In the private sector, employees get compensated when they provide value-masters or not. In the public sector, employees get paid for a masters-whether it adds value or not. Even aside from studies, it does not make intrinsic sense that a teacher who has a high school diploma and a college degree needs a masters to teach to a ten-year-old. I think you are confusing cause and effect.
Bailey April 16, 2012 at 02:19 PM
Really- shouldn't compensation be based on PERFORMANCE AND RESULTS? I am aquainted with teachers and the only reason they take a class is to move over a lane and earn more money. They know it translates to higher pension. I know one teacher that acquired a master's one year prior to retiring to bump up the pension. Do you want your children and grandchildren taxed to pay for that kind of abuse? While census reports show that a person with a master's earns more, I would think those numbers are based on 12 month employees that work until about age 65-- not 8 month employees that retire much earlier. It is not a teacher phenomenom to come out of college in debt, get a unimpressive starting salary and work many years to reach 60k. It is common- for employees working 12 MONTHS A YEAR. Teachers should be fairly compensated- based on an 8-9 month job and based on performance and results. Teacher salaries are a matter of public record and available online. Base your opinion on those facts.
John Parker March 10, 2013 at 09:51 PM
It seems to me that the teacher supported union is doing to us locally the same thing the Auto Union did to Detroit. Guy, please do me a favor and pass this youtube clip to everyone you know. We need to get a ground swell going to try and bring D-211 back to reality. http://www.youtube.com/watch?v=qG5oBYiUqrc
John Parker March 15, 2013 at 10:42 PM
Local School Boards earned their share of the blame in this mess. http://www.youtube.com/watch?v=qG5oBYiUqrc http://www.youtube.com/watch?v=A_OSJOCGcW4 http://www.youtube.com/watch?v=y49qYv6KhEg http://www.youtube.com/watch?v=y9SWJBDd68Y

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