Is the Price of Graduate School Worth It?

Is grad school worth going broke?
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In tough economic times, many people turn to education. Layoffs, extended unemployment, and the job security and financial fears that accompany a turbulent economy have made many adults flock to college as a way of gaining skills and credentials and safely weathering this economic storm. Many adults return to college to finish bachelor's degrees that they put on hold years ago to enter fulfilling careers that may be less so now.

Enrollment is up at many college and universities and it is not just undergraduate institutions that are opening their doors to nontraditional, older and more experienced, students. Graduate schools are reporting high enrollments for the same reasons. A graduate degree, a master's or Ph.D., is a credential that, depending on the field, can make a job applicant more competitive. Is a graduate degree really worth it? Or is it simply a good way to hide, be productive, and avoid a tough job market?

1. Consider the Cost

The first step in determining if graduate school makes financial sense is to consider the sticker price. The price of graduate programs varies dramatically and has increased over 60% in the last few years. In a public state college you might spend $10,000-$15,000 per year whereas, at a private school or top tier university, you could easily spend $30,000 per year. The average master's graduate owes about $30,000.

We know that people with advanced degrees earn more, generally speaking than those with bachelor's degrees and those without a college degree. But is the bigger paycheck enough to offset the cost of graduate study? As you consider graduate programs, estimate what your monthly loan payments will be after graduation.

Is it a scary figure? Although graduate degree holders are more likely to be employed and at higher salaries than other workers, nothing is certain and the higher salary may not be worth mortgage-sized student loan payments.

2. Consider Missed Income

In addition to the cost of a graduate education, you must consider the money you won't earn because you're in school. Many returning students are unemployed, so this piece of the equation may be moot; however, consider that you may not be able to look for a job or begin one while completing a full-time graduate program.

3. Look into Financial Aid

Cost should not necessarily rule out graduate study. Financial aid is available, but it varies by school and by discipline. Students in the sciences can expect to receive scholarships and assistantships that cover their tuition and often offer stipends in exchange for work. Science students tend to be funded by research grants obtained by faculty members to conduct specific research projects. Students in the humanities tend to receive little funding, largely because humanities faculty do not obtain grants as large as science faculty because they have fewer needs for laboratory space and equipment.

Whether grad school is worth it might depend on what discipline you choose.

4.  Consider the Intangible Benefits of Graduate Study

Many students say that their decision is not entirely about money. There is a value to expanding your knowledge, learning how to become a better thinker. Graduate school can deepen your intellect and improve your appreciation of life.

Ultimately, is graduate study worth it? I can't answer that for you. Consider your circumstances: Can you fund it? Can you deal with lost wages? How much do value the intrinsic aspects of graduate study? Above all, viewing graduate study as an easy or instant way to a better job and higher salary is dangerous. It’s probably true when we consider long-term outcomes, but less so for short-term, more immediate outcomes. Of course, this all depends on the field and your mileage may vary.

The takeaway? Do your homework. As you learn about graduate programs, learn about their graduates: What do they do? Where do they work? There isn’t a one-size-fits-all answer to this question. It’s up to you to determine grad school’s worth given your life and circumstances.