What Millennials Need to Know Before Applying to Grad School

Student debt is the new norm

• Average student debt: $29,400
• 31% of faqs/what-millennials-need-to-know-when-applying-to-grad-school 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 faqs/what-millennials-need-to-know-when-applying-to-grad-school define their job as a career

This debt can delay key life milestones:

• Home purchases
• Marriage
• Having children
  • 36% of faqs/what-millennials-need-to-know-when-applying-to-grad-school 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

Sources:
http://www.forbes.com/sites/raymondjames/2014/01/13/applying-to-faq/is-grad-school-worth-it-what-faqs/what-millennials-need-to-know-when-applying-to-grad-school-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/