Is Grad School Worth the Cost?

Most of my friends have been working for a few years now, and many are deciding if they should go to grad school in hopes of better job prospects and longer term higher earning. Obviously, the value of going back to school varies by industry – some require higher education in order to climb the ranks, while others are far more heavily weighted towards merit. Once you take into consideration things like negotiation skills and networking, actually quantifying the value of education varies by person and is impossible to measure. Instead, let me present my side of the story. Maybe it will help you, maybe it won’t. Regardless, I’m curious to see if my decision to stay in school 3 years ago has made a significant earnings impact for me yet.

When I completed my undergraduate degree, the only job offer I had was to be a Risk Analyst in Philadelphia making $50K a year. I was worried about living in an expensive city (that’s funny to me now, but Philly seemed pricey to me then) on what I considered to be a very average salary. For me, choosing to go to grad school instead was a no-brainer. Now that it’s been a couple years, it’s time to look back and see what my ROI was on getting a Master’s degree.

Salary Projections:


Okay. First off, there are a lot of assumptions going into the numbers above. Since my job offer in Philly was one with little to no bonuses, Year 1 is pretty self-explanatory. For the rest of Philly, that’s assuming a 4% increase in salary, which can be quite high depending on the company. I assumed a promotion/new job after 2 years that brought me to $60K in year 3. A 15% increase in pay is higher than a typical promotion, so it’s more than possible that if I had taken the offer my salary might be even lower right now. As for the Grad School row, those are pretty much historical numbers. Since I changed jobs in the middle of the year, I just took an average of my salary each month this year. I don’t want to project what I’ll be making by the end of next year – I have high hopes, and there shall be no chicken counting before eggs have hatched in this basket.

Net Worth Projections:


These are the more important numbers. If I had moved to Philly, I would’ve had the added cost of rent and a car to pay for. Since the offer was at a mortgage insurance firm, I likely would’ve paid attention to things like building good credit and saving for retirement, so this also assumes significant retirement contributions. As you can see in row 2, grad school set me back $35K. Because my job offer after graduation was close to home, I saved money on rent and didn’t have to pay for a car, paying off nearly $15K of my $35K debt in the first year. I also saved heavily at that time, in some months putting away nearly 60% of post-tax income away into retirement. The most important thing is that by the end of next year, I’ve projected my net worth to be higher than if I had taken the job in Philly.

Net Worth Projections, excluding Retirement:


This chart makes the most sense to me. I’ve only recently begun to take up personal investing, which is something I doubt I ever would have attempted in my 20s if not for grad school-related experiences. Since I plan on investing far more heavily in myself next year (and my debt will be fully paid off), that’s where the difference is most evident to me. I’m very much a cautious person, not just in investing but also when it comes to self-promotion at work.


What does it all mean?!?

Costs aside, there were a ton of intangible benefits of grad school that don’t have a dollar amount ROI associated with it. I learned how to talk to people in a professional setting (I sort of could do this before but it may or may not have set off PANIC MODE every time), met a lot of really smart people (like my boyfriend, heyyyyy), and just generally used the time to figure out what direction I wanted my career to go in, rather than jumping into something I was very likely not going to enjoy. 100% honest here – I’m still figuring out my direction even as I type these words. Do I want to go teach English in China? Blog from a beach in Thailand? Get to the top of my current field? Who knows? But at least I know where to get the information I need to make those decisions. That doesn’t put me ahead of the curve, but I know I’m not falling behind. If you’re reading this, you’re probably in the same boat. Go us!

Still unsure whether grad school is worth it? I think that as long as the financial burden of higher education is something you can handle, then go for it. The experiences you get from it are invaluable, I promise.


  1. Author

    I think graduate education is far more valuable than undergraduate. It provides a more meaningful and tangible experience than most undergraduate programs, and really helps one focus into a specialty or develop mastery of a skill set. A standard college education is, unfortunately, a huge money sink for a rather risky bet.

    And on a less academic note, being surrounded by a smaller, more closely-knit cohort of similarly-engaged individuals (because let’s face it, college is now full of people who don’t want to be there) really makes for a special experience. I made friends in college, but I made best friends in grad school.

    Also, heyyyy 😉

    1. Author

      I definitely don’t disagree with you. I made best friends in grad school, too. However, I do believe it’s not a choice that makes equal sense for everyone.
      Also, heyyyy 🙂

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