The Costs and Benefits of Graduate School

When deciding whether attending a graduate program is right for you, consider making a list of the costs and benefits.


  • Time
  • Money
  • Stress
  • Delaying other life opportunities/events


  • Chance of getting your dream job
  • Potential to make more money
  • Intellectual enrichment

PhD programs are traditionally funded, but stipends are small and lots of students will still take out loans to finance their rent, living expenses, etc. It’s a good idea to have a sense of how much you will need to live comfortably. Take into consideration living with roommates, food + car costs, and the general cost of living in the city where your school is. Factor in that summers are sometimes underfunded or not at all, and you may have to either get another job over the summer or take out more loans to make it through.

But, taking on debt isn’t always bad. Sometimes a little bit of education debt can be worth it in the end if you are getting your dream job or if you can increase your income potential substantially. Rather than think about what you finances will be like during graduate school, think about 10 years from now. How will your earning potential increase by getting this degree and is that worth taking on some debt now?

Consider this financial example of a two year terminal Master’s program

CostsLoan + Interest (5%)Monthly payment
$40,000 (tuition)~48,614$507
$50,000 (living expenses)~60,787$633

Total monthly loan cost after graduation: $11,40

Starting salary estimate: $60,000 – 25% income taxes = $45,000/year or $3,750/month

Loan costs should equal 30% of your monthly income (before taxes)

This should give you a rough estimate of what loans look like after you are finished graduate school and what a payment structure could be. Depending on how much you end up taking out, you could decide to pay off your loans in 10, 20, or 30 years. And the interest rates are highly variable depending on the market, economy, and type of loan.

While there’s a lot to factor in here, take this as a learning opportunity to evaluate whether this is right for you or not. Graduate school is grueling, but it can be worth it if it will help you get to where you want to be.

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