Is it worth it to go to graduate school? Unless you’re hoping for a substantial compensation increase, this is unlikely to be the case.
Grad schools have a good return on investment, according to a recent report from the Foundation for Research on Equal Opportunity (FREOPP). Nearly 14,000 graduate degrees, including 11,600 masters and 2,300 doctoral and professional degrees, are assessed in the report in terms of increased lifetime earnings.
It’s possible that the results will put a damper on your college plans: There is a negative financial return on investment for 40 percent of master’s degrees and 14 percent of higher education degrees.
According to the survey, whether or not getting a master’s degree is a wise financial option relies heavily on the topic of study. Over the course of a person’s working career, a master’s degree raises their wages by an average of $83,000.
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Most master’s programs in computer science, engineering, and nursing, for example, give an ROI exceeding $500,000 as a safe investment financially. However, you might be surprised by some of the findings.
More than 60 percent of MBAs and other business-related master’s degrees studied have negative ROIs, according to a new study. An advanced degree in art or humanities is also an option. According to the survey, they had a typical return of $400,000 in losses.
Most professional degrees in law and medicine generate a return of more than $500,000 for their students, with the exception of a few. Even though 86% of advanced degrees have a positive ROI, Ph.D. programs in education and other non-STEM disciplines are an exception to this rule.
Graduate degrees have become increasingly popular in recent years, notably during the pandemic, with most students citing their desire to advance their careers as their main motivation.
Of course, money isn’t the most important consideration for everyone when it comes to education — perhaps your aspirations of advancing academically outweigh your worries about making ends meet. According to the report, the most important consideration for most people who are contemplating graduate school is their personal financial well-being.
Master’s degrees are virtually always seen as an investment in one’s future earning power, the survey states.
And graduate education can be expensive, as there is generally less financial aid available to graduate students than to undergraduate students,. There is also the fact that many grad students who work full-time while enrolled in school have to give up some of their income while they are in school. Even while this varies by degree, the average 27-year-old enrolling in graduate school will forgo $48,000 in earnings in one year, according to the study.
When considering if graduate school is the correct choice for you, there are several factors to consider such as how much it will cost, what professional pathways you will be able to pursue, and whether there are other methods to achieve your goals. Though it’s important to remember that the type of degree you earn will certainly have a significant impact on your future financial well-being.