Is Graduate School Worth the Cost?
By Brittany Brinckerhoff
Whether you are looking to deepen your knowledge on a topic, position yourself to move up in your career, or simply pivot down an entirely new path, deciding whether to pursue a postgraduate degree is a big decision.
Graduate school can be a worthwhile investment, but it can also be expensive and time-consuming, so you want to be confident that you’re making the best choice for you – not just because it seems like the logical next step or a generally “good” thing to do. To help you weigh your options, take these three steps:
1. Take time to be introspective.
Before you get any further into the details and logistics of grad school, think big picture about what you want for your life and your career. Does grad school accomplish a necessary step towards a specific career, or is it more of a general interest in a field you might want to pursue? If it’s the second, are there any other paths that could get you where you want to go? You may want to talk to people who have gone through this type of program and/or are working in your dream job. Since they’ve done it already, do they have any suggestions for you?
You will also want to estimate your potential earnings after getting the degree. It’s OK if your goal is not to make a huge amount of money, but is the future salary worth the effort of getting the degree?
The goal here is not to dissuade you from pursuing a higher degree but to ensure that you’re being mindful about it. Since grad school can require such a large investment of your time and money, you wouldn’t want to go through all that effort just to realize it wasn’t what you were expecting or it wasn’t as necessary as you thought.
2. Do some number-crunching to compare programs.
If you’ve decided that grad school is the ideal next step for you, then it’s time to put your spreadsheet skills to the test. You will want to compile information on each of the schools you might want to apply to. While doing this, it’s important to keep an open mind and not get too focused on any one program – there is no guarantee that you will get accepted at that school, and researching a variety of programs will help you better understand the potential overall cost.
The data to collect will vary depending on what type of graduate program you’re looking at, but here are some ideas: program duration, program size, program specialties, admissions requirements and deadlines, admissions rates, availability of financial aid, and scholarship/grant opportunities.
You’ll also want to do a breakdown of the estimated costs for each program – tuition, books, school fees, etc. This will give you a sense of the overall cost of the program (which, of course, can vary based on financial aid, scholarships, and grants).
If you’ve only been looking at schools that are geographically close to you, you could also think about whether you should be more flexible with your location. Schools that are more remote might be less expensive overall, but you’ll want to weigh that against the cost of relocating.
Gathering all of this information in one place is an efficient way to compare your options – this should make it easier to determine which programs are your top choices and which ones are not as appealing, as well as give you a sense of the real cost of grad school.
3. Create a plan to pay for it.
Now that you have a realistic sense of the cost, you can consider a plan for managing these expenses. Some of the typical options include:
Applying for student loans – federal or private
Working during school – part-time or full-time, depending on the intensity of your program
Reducing your living expenses – comb through your current budget to find any expenses that could be reduced or temporarily cut. Do you have a partner or family member who could help cover living expenses?
Using your cash reserves – planning ahead gives you more time to save up cash. Ideally you won’t need to tap into your longer-term investment/retirement accounts, but that could be an option as well.
Borrowing money from a friend or relative – friends and family often offer a pretty reasonable interest rate! But beware of creating a borrower/lender relationship with loved ones. This can create a difficult dynamic in your personal life.
Asking your current employer to pay for your education – this won’t always be an option, but it’s great when it is.
You will likely have numerous options for funding grad school expenses, and this is where the financial planning process can be really helpful in understanding the potential longer-term implications of each choice. As a whole, though, the sooner you start planning, the better!
Completing a graduate program is a huge accomplishment, but it’s even more valuable when you’ve carefully considered how it fits into your broader life plan. As financial advisors, our mission is to help you feel confident as you weigh these options, and our Ascend program is geared towards young and mid-career professionals, who are often making these types of decisions.
Please reach out if you’re interested in discussing how grad school could fit into your financial plan!
Originally posted on TheStreet:
https://www.thestreet.com/retirement-daily/nextgen-money/is-graduate-school-worth-the-cost
This material is provided as a courtesy and for educational purposes only. Please consult your investment professional, legal or tax advisor for specific information pertaining to your situation.