Tae Kim

Tae Kim

So You Are Thinking About Graduate School…

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If you are a grown adult, many of you have thought about it.

“Should I go back to school for a graduate degree?”

“Should I pursue that MBA I always thought about? Law School? Or a Masters in [fill in the blank here]?”

We dream of that new shiny graduate degree propelling our career to the next level. Creating new opportunities. Generating more income.

Average salaries for people with graduate degrees is higher than that for people with bachelor’s degrees. However, it doesn’t always mean graduate school is a wise investment.

I want to share with you few questions you should ask yourself as you are debating this question.

1) Will That Graduate Degree Really Help Me Advance?

Not all degrees are made equal. The earning premium for graduate degree is different for every specialty and the difference can be pretty drastic in certain cases.

According to Georgetown’s Center of Education and the Workspace, STEM (science, technology, engineering, and mathematics), health and business majors are the highest paying majors. Entry level annual average salary start at $37,000 and earn on average of $65,000 over the course of a recipient’s career.

In contrast, majors in the education, arts and social work fields are some of the the lowest paying – early childhood education ($39,000); human services and community organization ($41,000); studio arts, social work, teacher education, and visual and performing arts ($42,000); theology and religious vocations, and elementary education ($43,000); drama and theater arts and family and community service ($45,000).

It’s therefore no surprise that engineering majors or health professionals who go on to get graduate degrees in their field see the biggest increase in their earnings.

Therefore you must ask yourself the hard question. Will going back to school help me advance? Will it help me reach my goals if I want to increase my earnings?

2) How Much Debt Am I Willing to Take On?

Schools cost money. And it seems to cost more today than it did years ago. If you still have student loans from your undergraduate days, know that any money you borrow for graduate school just get added to the pile. After having spent over three years paying back student loans after my MBA, I can tell you student loans are no fun.

When I initially took out student loans, I foolishly treated it like monopoly money. I didn’t understand the gravity of what I was signing. It wasn’t until later when I had to send my hard earned money to the bank every month, I felt the true weight my of decision.

If possible avoid student loans. However, if circumstances does not afford you that luxury, here are few tips:

There are two kinds of federal loans available to graduate students – The Direct Loan and the Grad PLUS loan

Start with the Direct Loan program. This allows you to borrow up to $20,500 annually and $40,500 in you are attending medical school. It also has the lowest interest rate of all graduate school loan options.

If that is not enough, then consider the Grad PLUS Loan. You can use this loan to fund the entire cost of your education such ash tuition, books and living cost. Know that the interest rates are higher than Direct Loans.

Avoid private loans at all cost. They not only come with higher interest rates, but are much less forgiving and flexible than the federal government. If the graduate program cost requires you to need private loan, I want to challenge you to think real hard about the decision to go back to school.

3) Could Your Employer Help With School Cost?

Super Mom Finishing Grad School, Working Full Time & Raising Two Kids

Many employers offer programs to help out with education costs. Of course nothing comes for free, so often employers will require you to stay with the company for an additional number of years in exchange for paying the program. This is a great option if you want to avoid student debt.

My wife recently completed her Masters in Nurse Practitioner with $0 out of pocket cost through this strategy. After having worked as a Registered Nurse at her current hospital for 6 years, she decided she wanted to go back to school to advance her career. Thankfully the hospital had a program that covered 100% of her tuition and other costs in exchange for a 3 year contract at the completion of the program.

The superwoman that she is, she grinded through two and a half years of graduate school, full time work and the raising our 2nd child (our daughter was born 5 months prior to her starting her program).

With this option, we were able to save approximately $40k in tuition ($20k), books ($1k) and paid study days ($18k). Most employers offer some form of tuition reimbursement so I challenge you to research your options.

Are you thinking about graduate school? What are you looking to accomplish through the degree? How are you planning to fund it?

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Mr Financial Tortoise
Mr Financial Tortoise
3 years ago
Reply to  Chrissy Kay

Thanks Chrissy for reading and commenting on my post! Really appreciate it! Higher education is so expensive these days its imperative we stay on top of our options. Your kids are very lucky to have parents that are thinking ahead for them!

Chrissy Kay
Chrissy Kay
3 years ago

This was such an informative post! I’m long past college age, but my oldest is 13, and we’ll soon need to consider career/education paths for him. I’m a planner, so having this info, even at this early stage, is very appreciated! The infographic was especially helpful. Your site looks fantastic! Looking forward to reading more.