Students must weigh future salary and career prospects against debt and lost earnings.
Seeking more education may feel like a promising option for gaining skills and increasing job opportunities, but prospective students must first determine whether graduate school is worth the cost.
In recent years, increased federal and legislative attention has been paid to the cost of an undergraduate education. But total tuition for some two-year, full-time graduate degrees can cost more than $100,000, and doctoral or professional programs often cost even more.
To afford tuition and living expenses, many students take on debt. Loans issued to graduate students account for 40% of federal student loans awarded each year, although grad students are just 15% of the higher ed student population, according to the 2020 Center for American Progress report on graduate school debt.
So before enrolling in a graduate program and borrowing to pay for it, prospective students should consider their long-term career goals, among other factors.
“If I’m talking to somebody who is interested in graduate school, my first question is, ‘Why?'” says Jay Mixter, senior consultant at Admit Advantage, an admissions consulting company. “If there is a good story there and if they’ve thought that out, and grad school is a vehicle that would either accelerate their ability to get there or allow them to access the kind of career path that would get them there, then they’ve got a good basis for potentially wanting to go to grad school.”
Weigh Potential Earnings vs. Graduate School Debt
On average, individuals with a graduate degree earn more than those with only a bachelor’s degree.
The median weekly pay for full-time, year-round workers holding bachelor’s degrees was $1,334 in 2021, according to U.S. Bureau of Labor Statistics data. Median weekly earnings for full-time employees jumped to $1,574 for those with a master’s degree and to $1,909 for holders of a doctoral degree.
However, experts say, the wide range of costs and debt by graduate program complicates attempts to determine an advanced degree’s worth.
Some industries require a graduate degree to be eligible for certain jobs or higher-level positions within a company. But “even in cases where graduate school is a requirement for a particular career, it may not provide you with the financial return on investment you hope,” Kendra Millay, academic advising team leader and law school admissions counselor at IvyWise, an education consulting company, wrote in an email.
“It is important to research specific fields to determine how saturated that particular job market is and understand what type of salary you can expect years down the road,” Millay says. “From there, a student needs to do some soul searching and make that very personal decision for themselves; you work for a long time, so you should have the career that makes you happy.”
However, it’s not just about having the additional credential to stand out in the job market, says Sheila Akbar, president and chief operating officer of Signet Education, a Massachusetts-based college admissions and tutoring company. The skills acquired while earning the degree are also important.
“There’s a lot of really great content out there from former academics trying to show people how those academic skills are directly impactful and transferrable to an industry or business setting,” she says. “Because just saying you’ve published X number of papers is not going to impress a business person. But saying that you’ve conducted a qualitative interview, drew insights and built a really complicated model to understand it, that will.”
Trends in borrowing at the graduate level paint a stark contrast: While undergraduate borrowing declined $15 billion from 2010-2011 to 2017-2018, per the CAP report’s analysis of federal loans, graduate student loan debt grew $2.3 billion during that period.
Prospective graduate students should also be aware that the amount typically borrowed can vary by institution type. In 2015-2016, student loan borrowers who graduated with a master’s degree had on average $54,500 of debt from attending public schools versus $71,900 of debt for those who attended private nonprofit institutions, according to the most recent data available from the National Center for Education Statistics.
Borrowers who graduated with a research doctorate left with an average of $92,200 in debt from attending public schools and an average of $94,100 from attending private nonprofit institutions, NCES found.
Student loan debt numbers for graduates with professional doctorate degrees jumped into the six figures in both categories. Students at public schools graduated with an average of $142,600 in debt, and those at private nonprofit institutions graduated with an average of $221,800 in debt.
Professional doctorates include fields like dentistry, law and medicine. These fields typically have the highest salaries, which may make the debt and time spent in graduate school worth the cost for some students.
These NCES averages don’t include students who didn’t take out student loans, but do include undergraduate loans that borrowers may have in addition to their graduate debt.
Undergraduate students loans go into deferment while a student is enrolled in graduate school. But experts recommend still making payments while in school, if possible, to decrease the principal.