Search This Blog

Tuesday, August 26, 2014

74. Going Back to School for College or Graduate Degree?

What are some factors to consider when contemplating going back to school for either college or a graduate degree?




It really depends on what field your considering going to undergraduate or graduate school in when considering taking out loans. 

So questions:

A. What is the field? 
B. How much debt will you have by the time you graduate? 
C. What impact will this degree have on your career or earning potential? 
D. Have you considered moving to another state and/or living with family while getting this degree? 
E. How much can you work to pay cash for expenses (tuition, room & board, books, etc.) while in school?
F. How long will it take for you to pay that debt back?

First, if you do plan on going back to school educate yourself on all available options. There's a lot of scholarships out there. Start with this website:

www.finaid.org 

Second, consider website www.payscale.com like for comparing job profiles to the salaries of people with comparable skills and experience. Choose a potential degree that suits your interests and allows you to make a living wage. 



Third, consider www.glassdoor.com looking up jobs by company and title. 

This will give you an idea of the potential income for entry level, mid-career, managerial, and executive positions in your field of interest. 

Are you a college student? Read this post for some further advice to college grads.



A college or graduate degree can significantly boost a person's chance at a raise, promotion, or better job. 

It is typically recommended that a student "keep their debt low enough that they don't have to spend more than 10% of their post-graduation pretax income on student loan bills." (Kim Clark, U.S. News 2009)

It is a good idea not to take out more student loans more than your starting annual income. You should be able to pay back your student loans in about 10 years. "If your total student loan debt is less than your annual income, you'll be able to repay that debt in about 10 years." - Suzanna De Bacca, U.S. News 2012

I got an MBA and it cost me about 20-25k. I went to a state school though. The program was supposed to be a 2 year program. It took me 5 years and I paid cash as I went. It was well worth it in 5 years since graduating I've more than doubled my income with a new job opportunity. Again typically it is recommended not taking out more debt than your first years salary worth of loans. 

That said, I have an acquaintance who went to a very prestigious school who took out 150k worth of loans in 4 years for a business management college degree. She pays $1100 a month just in student loans alone. $1100! That's a house payment. That's before groceries, rent, utilities, gas, or anything else. And it will likely take 15-30 years to pay off unless there's a significant increase in her income, she wins the lottery, or she marries someone wealthy enough to pay off the debt. 


So what do you think? Was this helpful? Leave a comment!


-------------------------------------------------------

Follow me on Twitter! @JWKEagle


Looking for a particular topic? Please check out the new Table of Contents to see posts listed by topic.