Are you thinking of going back to graduate school? Have you ever wondered if the degree you are looking for will bring you a good return on investment (ROI)?
It is important to consider the full cost of graduate school (and its potential impact on your career and earning potential) before you spend $1,000 on exam preparation, entrance exams, and admission fees, and of course, before you send a deposit. and notify it in your work. Our graduate school ROI calculator (below) can give you an idea of what you can gain (and forfeit) by going back to school.
How to Use the Graduate School ROI Calculator
- Enter your age.
- Enter your current salary (so the calculator can include opportunity cost).
- Enter the total postgraduate cost for one year. Add the following together to get a rough estimate:
- The total tuition fee you will be required to pay at your chosen university, plus any fees. (This can usually be found on the university website.)
- Your expenses for books or other materials. (For a master’s degree in creative writing, it costs next to nothing; for a law degree, a year of reading books can cost you $1,800. Do some searching to find a rough estimate.)
- Living expenses. (If you plan to stay in your current city at your current location, your own previous expenses should be a rough guideline. If your dream school is elsewhere, consider looking at apartment listings and roommate ads to get an idea of what how much you will have to pay in rent.Then factor in utilities, transportation, food, and entertainment.Your current budget might be a good place to start, but you should definitely cut back when you’re in school and living on loans… like this one calculator will be clear!)
- Enter the length of your program (in years).
- If you want to choose advanced settings, enter the amount of student loans you expect to receive, as well as the interest rate and loan term. Otherwise, we will use 6% and 10 years as the average.
- Enter your expected salary upon graduation. Here it is worth clarifying: look not just for the average salary in your profession, but for the average salary of this profession in the region in which you are going to live. Lawyers in New York earn much more than lawyers in Tampa. Be sure to use reasonable First year salary, not what you hope to get after five or 10 years in this field.
Once you click Submit, we will calculate the following:
- The total cost of graduate school, including opportunity costs, tuition and fees, and loan interest.
- Your lifetime earnings at your current salary, and your lifetime earnings at your projected graduate salary.
Look at lifetime earnings. How big is the difference and is it worth the cost, risk, and effort required to get into graduate school. Keep in mind that things change and nothing is guaranteed.
In addition, if you continue to work while studying, this also reduces your overall expenses. You may not need to borrow as much and your opportunity cost will be lower. You will still receive your previous salary while in school, or at least part of it.
Keep in mind that it’s not always about the numbers. If a college degree gets you a job you love, it’s worth a lot more than just money.
Summary
This calculator can do the math, but of course you have to look at your entire life to make that decision. If you continue to work and live cheaply while studying, it will help keep costs down and reduce the overall negative impact of going back to school.
But also consider lifestyle. If you need a degree to get your dream job, finances may not matter as much.