Graduate degrees can do wonders for your career. They can make your CV stand out in a competitive job market, give you the skills needed to move up the corporate ladder, help you change industries and increase your salary.
But studying is expensive. The National Center for Education Statistics found that students, on average, put up more than $70,000 in student loans to pay for school — a number that can be in the six figures depending on the program you choose. However, there are some ways to keep those costs in check. Here’s what you should know.
Key Statistics on Graduate Student Loan Indebtedness
- The average cost of tuition and graduate school fees at public universities in the 2019-20 academic year was $12,410, while tuition and fees at private schools was approximately $26,600.
- Graduate school costs vary widely from one program to the next. For example, students pursuing a masters in education spent an average of $18,812 per year on school in 2016-17, while medical students spent twice as much.
- More than half of doctoral students take out loans to finance their education.
- The average annual loan amount for graduate schools has more than doubled over the past two decades.
- On average, graduate students in the US leave school with about $71,000 in student loans alone and a total of $82,810 in undergraduate and graduate student loans.
- Student debt is more common among medical and law students than other college degrees. It is estimated that 75 percent of professional doctoral students (including medical and law students) graduate on student loans, versus 60 percent and 48 percent of those earning master’s and research doctorate degrees, respectively.
- Public Administration, Social Work, Fine Arts, and Public Policy are among the master’s programs with the highest proportion of student loan recipients.
- Graduate students account for half of the country’s outstanding student debt.
Average cost of graduate school
The latest data released by the National Center for Education Statistics shows that the average graduate student spends nearly $20,000 a year on tuition and fees. However, for graduate students attending private nonprofit schools, that number jumps to $28,430, while those attending public schools spend around $12,410.
But the type of institution you choose isn’t the only factor that determines how much you spend on your graduate education, as some programs cost significantly more than others.
Mary Morris, former executive director of the College Savings Foundation, says the reason is simple: some programs simply cost more to teach than others.
She says you should think about the cost of training a doctor, for example. The labs, technology and equipment required to deliver the curriculum are more expensive than, for example, materials needed for fine arts education.
Average student loan debt after graduation
Because graduate school is so expensive, most students have to bridge the financial gap by taking out student loans. This has become so common that the average annual loan amount for graduate schools more than doubled between 1994 and 2014, according to the Brookings Institution, and graduate students now account for half of the country’s student loan debt.
When it comes to federal student loans, graduate students have two options:
- Direct Loans. A federal direct loan allows college graduates and professionals to borrow up to $138,500 (or up to $224,000 for medical schools) with a fixed interest rate of 6.54 percent for 2022-23 and a processing fee of 1.057 percent. In addition, federal direct loans do not require you to pass a credit check, and almost anyone with a good academic record is eligible.
- Degree PLUS loans. With a Grad PLUS loan, you can borrow up to the full cost of attendance, as determined by your school. Unlike federal direct loans, Grad PLUS loans require students to pass a credit check and currently have a fixed interest rate of 7.54 percent for 2022-23 plus a 4.228 percent processing fee.
Students can also take out private student loans to fund the school. However, these often have higher interest rates than government student loans and offer less protection and repayment options.
Average student loan debt by program
According to the latest data from the National Center for Education Statistics, most graduate students in the US leave school with over $70,000 in debt. However, depending on the type of degree (master’s versus doctorate) and field of study, the student loan amount varies greatly.
For example, students pursuing a law degree receive more than twice as many student loans than those pursuing a master’s in education.
|program||Average student debt 2015-16|
|Masters of the Arts||$72,800|
|master of education||$55,200|
|Masters in Sciences||$62,300|
Source: National Center for Education Statistics
How to reduce graduate school costs
The cost of a college education has risen steadily over the past decade, and with inflation at record levels, sticker prices aren’t going down anytime soon. Still, there are some options you can consider to make your studies more affordable.
View online or accelerated programs
Although some schools charge the same amount for both their online and campus programs, others charge less for their online courses. For example, if you were to enroll in an online MBA program at Arizona State University, your tuition and fees for the 2022-23 academic year would be $23,044 if you are a resident student. However, if you choose to pursue the MBA on campus, that amount would increase to $29,164.
Likewise, Morris says that closing faster can also save you “thousands” — and she’s right. A one-year personal MBA program at the Kellogg School of Business costs $157,578, while the two-year program costs more than $230,000.
Look for scholarships and tuition opportunities
Scholarships are a type of financial aid awarded to outstanding students based on their academic achievement and future potential. These programs are very competitive, but the perks are worth it as you could get money to pay for all your graduate school expenses or get funding for a specific research project.
Some schools also offer tuition waivers or some form of cash reward for students who serve as teaching assistants. However, this will require a certain investment of time on your part, so keep that in mind.
If you are employed, ask for student aid
Some companies offer their employees help with their college expenses, either through a tuition reimbursement program or by paying off a portion of their loans after they graduate. To find out if your employer offers these opportunities, simply contact your human resources department.
It’s worth noting that while these programs can provide some much-needed financial relief, they often come with some strings attached, such as: B. staying in the company for a certain period of time.
The final result
Attending graduate school is expensive, but the rewards can be very rewarding. The most important thing is to research your options – both in terms of cost and financial support – to ensure you make the right choice for your wallet and career.