If you’re mulling over the idea of obtaining a graduate degree, it’s likely that the thought of using student loans to bear some of the cost has crossed your mind. It’s crucial to thoroughly ponder over if taking on debt to finance your education is a smart move.
First off, you must evaluate the necessity of a graduate degree for your career. If this degree is not a prerequisite for success in your career path, accumulating debt for it might not be advisable. It’s difficult to find financial advisors who would endorse acquiring debt based purely on desires rather than needs.
CAREER ORIENTED CONSIDERATIONS
Upon stepping into your career field post your bachelor’s degree, you might have envisaged that obtaining a master’s degree was inevitable. For professions in psychology and social work, a master’s degree could bolster your earning potential and present you with enhanced career prospects. To illustrate, in 2013, the median starting salary for psychology graduates with a bachelor’s degree was $37,000. However, this figure rose significantly to $48,200 for those with a master’s degree.
The majority of fields would offer a higher salary to a candidate possessing a master’s degree, though it might not always prove beneficial for several reasons.
Firstly, a master’s degree could actually exclude you from certain job opportunities. If you decide to pursue your master’s right after your bachelor’s, you will be applying for entry-level roles. Some employers might overlook your application, assuming you’re overqualified due to your higher degree. The master’s degree could potentially raise your minimum salary expectation, but it might also reduce the amount of positions for which you are a serious contender.
Conversely, if you’re mid-way through your career, a master’s degree in areas such as business and engineering could result in a greater array of opportunities and a higher salary.
FINANCING YOUR EDUCATION: ARE STUDENT LOANS THE RIGHT CHOICE?
Once you’ve asserted the necessity of a graduate degree for your career, the subsequent step entails deciding if using student loans to finance your education is feasible. Do thorough research on salary expectations with your intended master’s degree.
Websites like Payscale and Salary provide insights into salary ranges across different fields and regions. Armed with knowledge about your location and experience level, you can estimate the salary increase you could expect upon obtaining your graduate degree. Further, you might gather additional information specific to your field through internet searches.
When it comes to tuition costs, for in-state residents at a public university, fees could hover around $5,000 per semester. For out-of-state residents or those attending private universities, the cost could be closer to $10,000.
With the cost in mind, you can use online calculators to project your potential monthly student loan repayments. You can experiment with variables such as loan types, interest rates, and repayment terms.
What’s key to remember is that while a graduate degree could enhance your salary, it might not yield substantial take-home gains, especially considering taxes and retirement contributions. Ensuring your degree doesn’t result in a monthly salary deficit in comparison to the potential loan repayments is essential.
EXPLORING OTHER OPTIONS FOR GRADUATE SCHOOL FINANCING
If you’re convinced that a master’s degree aligns with your career goals but student loans appear unfavourable, there are alternatives you could consider.
PAY AS YOU GO
While being a full-time postgraduate student might seem quintessential, it is not mandatory. If you’re comfortably employed full-time, you could consider attending classes during evenings and finance your education by saving up for your tuition fees.
SCHOLARSHIPS AND GRANTS
Scholarships and grants for postgraduate degrees are available too. Additional avenues might include opportunities that cater to specific demographics, independent from specific fields.
SCHOOL SUPPORT
Your chosen graduate school could also provide financial aid. Some institutions offer fellowships to full-time students, which don’t require repayment. There could also be opportunities for research and teaching assistant roles that could waive some or all tuition costs.
EMPLOYER REIMBURSEMENTS
In certain cases, your employer might fund your post-graduate degree, recognizing the value of a more educated workforce. Policies vary significantly, and may require you to prove that the degree is applicable to your current role or a position that you could potentially assume.
HYBRID
You’re not only limited to a single option when it comes to financing your education. If you are able to secure some scholarships and employer-support, but still need additional funds, it might be sensible to consider student loans.
In summary, if a graduate degree aligns with your career path, ensure you thoroughly research all the options available before rushing into student loans. Multiple paths can lead you to your goal and save you money and stress along the way.
