What Millennials Need to Know Before Applying to Grad School

| Staff

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Student debt is the new norm

  • Average student debt: $29,400
  • 31% of millennials regret paying for college instead of getting a job and carving out a spot in the job market
  • Average wage for young college graduates: $16.60 per hour.
    • $34,500 for a full-time year of work
    • That’s the lowest average pay since 1998
  • The underemployment rate for college graduates is 18.3%
    • Compared to 9.9% in 2007
  • Millennials won’t reach median wage until they are 30
    • Unlike their parents, who made it around their 26th birthdays
  • Only about one in 10 millennials define their job as a career

This debt can delay key life milestones:

  • Home purchases
  • Marriage
  • Having children
    • 36% of millennials are living at their parents home
    • Tuition rates are increasing at twice the rate of inflation
    • Every nine years, the cost of higher education doubles

Are you considering grad school to give yourself an edge?

  • Balance costs with rewards:
    • Potentially growing $50K of debt to $150K is scary
    • There is a lot you can do with $100,000

First step: Know why the degree is important

  • Not always about more money:
    • Fields like:
      • Law
      • Science
      • Medicine
  • Graduate degree is a necessary stepping stone
    • Fields like:
      • Business
      • Technology
  • Graduate degree presents opportunity to hone skills and change career direction
    • Personal enrichment is a valid reason to go to school
      • Know that an advanced degree doesn’t guarantee a big paycheck though

Creative Strategic Planning

You may decide that your time is better spent traveling the world or starting a business. But if graduate school is the answer, here are some ways to mitigate costs:

  • Look for a one-year program
    • Shorter program = Cheaper cost
      • Seek out funding opportunities:
  • Research and teaching assistantships:
    • Will typically cover the cost of:
      • Tuition
      • Come with a small living stipend
  • Work while in school:
    • Look for contract work instead of low paying internships
      • You can hold a full-time job while taking classes after hours or during weekends
      • Work before going back to school:
        • Gain some professional experience
        • Save money
        • More cash on hand = less you will need to rely on interest-heavy loans
  • Think like a salesperson:
    • While in school, focus on cultivating skills that can translate into an income.
      • Look for markets, like technology, that are rapidly growing and facing a severe skills gap.
  • Ask for employer support:
    • Some companies offer a formal tuition reimbursement program to their employee
      • Don’t assume that the conversation is closed.
      • You may be able to negotiate a tuition reimbursement by committing to a longer tenure at your company
Millenials

Sources:
http://www.forbes.com/sites/raymondjames/2014/01/13/applying-to-grad-school-what-millennials-need-to-know/
http://www.theguardian.com/money/us-money-blog/2013/dec/06/student-loan-debt-minimum-poverty-wage-jobs
http://washington.cbslocal.com/2013/08/02/poll-record-number-21-million-young-adults-living-with-parents/

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