How to Pay for Grad School

The opinions expressed in this article are the author's own and do not reflect the view of Pathward^®.

When it comes to pursuing a graduate degree, one of the biggest hurdles many potential students face is figuring out how to pay for grad school. The costs of grad school can be daunting, but with careful planning and exploration of funding options, it is possible to make it more affordable. Ahead, we will delve into the various aspects of paying for grad school and provide you with a financial roadmap to navigate the next era in your educational journey.

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Costs to Research Before Applying to Grad School

While the intellectual and personal growth gained from grad school is invaluable, it's crucial to plan your finances carefully to ensure a smooth and successful academic journey. Graduate school is an exciting and rewarding endeavor, but it's essential to understand the costs associated with pursuing an advanced degree.

Tuition and Fees

Tuition and fees can vary significantly depending on the institution and the program you choose. According to data from the National Center for Education Statistics,  the average cost of a graduate degree in the United States was around $30,000 per year in the 2019-2020 school year. Doctoral programs cost significantly more, which is why it's crucial to research the specific programs you are interested in to get an accurate estimate of tuition and fees. Keep in mind that these costs may increase each year, so it's essential to consider future increases when planning your finances.

It's important to note that many universities offer financial aid packages, scholarships, and assistantships to help offset the cost of tuition. These opportunities can significantly reduce your out-of-pocket expenses and make graduate school more affordable.

Living Expenses

Living expenses include rent, utilities, food, transportation, and other day-to-day costs. To determine your specific living expenses, consider the local cost of living in the area where you plan to attend graduate school. Keep in mind that this can vary significantly depending on the location. For example, living in a metropolitan city is usually more expensive than living in a smaller town or rural area.

Fortunately, there are several strategies you can employ to manage your living expenses. Sharing an apartment with roommates, cooking meals at home, using public transportation, and budgeting wisely can help you stretch your funds and make the most of your graduate school experience.

Books and Supplies

Another cost to consider is textbooks and supplies. On average, grad students spend approximately $500 to $1,000 per year on books and supplies. However, this can vary depending on your program and the specific courses you take.

To save money on textbooks, consider renting or buying used books whenever possible. Many online platforms offer affordable options for purchasing or renting textbooks. Additionally, explore libraries and online resources to access free or low-cost educational materials.

Most university libraries will have your required reading materials or will source them for you free of charge. Some universities also have book exchange programs where students can buy or sell textbooks at discounted prices.

Some programs may provide students with access to specialized software, studio spaces, or equipment, often with additional costs attached. These hidden fees can be especially steep, so it is important to research them before you apply.

Miscellaneous Costs

Miscellaneous costs include expenses such as conference fees, professional memberships, research materials, and software. It's challenging to estimate these costs precisely, as they vary depending on your field of study and individual circumstances. However, it's wise to allocate a small portion of your budget for unexpected expenses. University websites often include estimates for grad students' miscellaneous costs, which will give you a better idea.

Attending conferences and joining professional organizations can be beneficial for networking and career development. However, these opportunities come with costs such as registration fees and travel expenses. It's essential to consider these expenses when planning your budget and seek out funding opportunities, such as travel grants or scholarships, to help cover these costs.

Evaluating Your Financial Situation

Before diving into the world of funding options, it's essential to take a step back and assess where you currently stand financially. By evaluating your savings, income, and future earnings, you can make informed decisions about how to fund your graduate education.

Assessing Your Savings

Consider how much you have saved up and determine how much you can contribute towards your graduate school expenses. Having a clear picture of your finances will help you understand how much you can afford to invest in your education while giving you peace of mind as you embark on this new chapter.

If you haven't started saving specifically for graduate school, don't worry. It's never too late to establish a savings plan. Consider setting aside a portion of your income each month towards your education fund. Even small amounts can add up over time and make a significant contribution towards your graduate degree.

Calculating Your Expected Income

It's critical to assess your expected income during your time in grad school. This might include income from part-time employment, internships, or assistantships. 

While these opportunities can provide financial support, it's also important to consider the impact they will have on your workload and ability to focus on your studies. When you are actively working on your thesis, for example, you may not have the time to work. Be realistic and consider potential fluctuations in work availability.

Estimating Your Future Earnings: Research Potential Earnings by Degree

Another crucial factor to consider when evaluating your financial situation is your expected future earnings after completing your graduate degree. Take the time to research the job market in your chosen field and determine the average salaries for professionals in that industry. Speak with graduate students about their experiences finding employment after graduation.

By understanding the potential increase in salary compared to the opportunities available with only a bachelor's degree, you can gauge the potential return on investment for your graduate education costs. This knowledge can provide you with further motivation and reassurance about the financial investment you are making in your grad school education.

Delay Enrollment and Save

Many graduate schools now offer deferred enrollment programs. These graduate programs enable you to work for a year or a few years after acceptance into the program before you actually enroll in the school. 

This is a great option for graduate school students looking to pay for grad school themselves who have already found well-paying jobs or for students looking to pay off their undergraduate student loans before beginning graduate degrees. Delaying enrollment enables you to save up a significant amount of money for your graduate program.

Part-time programs

Part-time programs enable you to attend graduate school with reduced hours of classes and workload per week. A graduate student in a part-time program can work a full-time job while attending morning or night classes. 

You can earn a master's degree or even a J.D. or doctorate through part-time study. Part-time programs allow you to pay for grad school by working, but these degrees take longer to attain, and it is a significant commitment to work full-time while attending school.

Applying for Financial Aid

Part of the graduate school application process typically includes applying for financial aid. Depending upon your situation, financial aid may be all you need to pay for graduate school, as your circumstances might motivate your institution to give you a full scholarship. However, it is very rare to receive a fully funded financial aid package, and it is less common at the graduate level than at the undergraduate level.

Your school may have specific programs offering full or significant scholarships to students from a certain city, students with test scores above a certain threshold, or students from particular backgrounds. It is worth researching whether your graduate school of choice has any such scholarship programs and how to apply to these programs. The financial aid office has information on such programs and how these awards would be allocated toward education and living expenses.

Applying for scholarships, fellowships, and other grants

One of the most desirable ways to pay for graduate school is through scholarships and grants. These are monetary awards that do not need to be repaid. Research and apply for scholarships and grants specific to your academic strengths and interests. Promising graduate school students may receive merit-based awards for their past achievements.

You can find scholarships that match your demographic background, field of study, and interests, so take the time to explore these opportunities.

When applying for scholarships, pay attention to deadlines and requirements and tailor your applications to stand out from the competition. Additionally, consider reaching out to professional associations and organizations related to your field. Many of these organizations offer scholarships and grants to support the next generation of professionals.

Utilize the Federal Work-Study Program

Another funding option to consider is work-study programs funded by the federal government. These programs allow graduate students to work part-time on campus while pursuing their studies. Work-study can provide a valuable source of income and often comes with flexible scheduling to accommodate academic obligations.

Consult your institution's financial aid office to learn more about work-study opportunities and eligibility requirements. The amount of work-study you are eligible for will depend upon your financial need. Also, research in advance how much you can expect to make in a work-study position since it varies by institution.

Participating in work-study programs can also provide networking opportunities and connections within your academic community, which can be beneficial for future career prospects. Be proactive in seeking out positions related to your field of study to gain relevant work experience while earning funds for your education.

Cover Any Remaining Gaps with Loans

While borrowing money should be a last resort, student loans can play a crucial role in funding your grad school education. Unlike undergraduate loans, graduate student loans typically offer more favorable terms and lower interest rates.

Start by filling out the Free Application for Federal Student Aid (FAFSA) to determine your eligibility for federal student loan options. Subsidized loans, in particular, are an excellent option since the government covers the interest while you are in school.

 Federal direct unsubsidized loans do not have the interest covered. Research all your federal loan options thoroughly before making a decision. It is also important to research whether a loan has a fixed interest rate or variable.

Consider a Private Graduate School Loan

Research private student loan options as well, but be mindful of interest rates and repayment terms. Compare different lenders and choose the loan that offers the best terms and aligns with your long-term financial goals. A private loan can help you pay for grad school, but if the terms are unfavorable, it may be challenging to repay.

Compare Private Student Loans

It's important to carefully consider the amount of debt you are willing to take on and create a realistic plan for repayment after graduation. If you have existing student loan debt, you may be hesitant to borrow money again through federal and private loans. Explore loan forgiveness programs and income-driven repayment options to help manage your student loan debt.

Sometimes, college scholarships and grants don’t cover all the costs, and loans become a resource for students. Be sure to research loans to determine if a student loan is right for you.

Get Help from Your Employer through Employer Tuition Assistance

If you are currently employed, investigate whether your employer offers tuition reimbursement or assistance programs. Many companies understand the value of continued education and are willing to invest in their employees' professional development. However, some tuition reimbursement programs require you to pay for graduate school upfront, so it is important to understand what student loans you may need to take out even with these programs.

Speak with your human resources department or supervisor to explore these opportunities. Be prepared to present a compelling case for how your graduate degree will benefit both you and your employer. Make sure to clarify the terms and conditions of these programs, as they often come with requirements for continued employment.

Employer tuition assistance not only provides financial support but also demonstrates your commitment to personal growth and advancement within your organization. It can be a win-win situation for both you and your employer.

Making a Financial Plan

Budgeting for Grad School

Once you have assessed your financial situation and explored funding options, it's time to create a comprehensive budget for grad school. Start by outlining your income sources, including personal savings, work-study earnings, and any financial aid or loans you will receive.

Next, list your expenses, including tuition, fees, textbooks, living expenses, and any other costs specific to your situation. Allocate funds to each expense category, ensuring that you have enough to cover everything while leaving room for unexpected expenses. Maintain a realistic budget and regularly review and adjust it as needed. Balancing your income and expenses will help you stay on track and avoid unnecessary financial stress.

Prioritizing Your Expenses

As you create your budget, prioritize your expenses based on their importance and impact on your academic success. For example, prioritize tuition and required materials over discretionary spending. Consider finding ways to reduce costs in areas like entertainment and dining out. Look for free opportunities on campus and in the community for socializing and entertainment.

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Planning for Loan Repayment

While in grad school, it's essential to also plan for the future and consider how you will manage your student loan repayment. Understand the terms and conditions of your loans, including the repayment period and interest rates. 

Calculate potential monthly payments and factor them into your future budget. Explore repayment options such as income-driven repayment plans or loan forgiveness programs that may be available for certain professions or in specific geographic areas.

Navigating the Financial Aid Process

Filling Out the FAFSA

If you are considering federal financial aid, such as grants or loans, filling out the FAFSA should be one of your first steps. The FAFSA determines your eligibility for various federal aid programs and provides valuable information for colleges and universities to assess your needs.

Complete the FAFSA as soon as possible, as some aid programs have limited funding and operate on a first-come, first-served basis. Gather all the necessary documents, such as tax returns and income statements, and follow the instructions carefully to ensure accurate and timely submission.

Understanding Your Financial Aid Package

Once you complete the FAFSA, you will receive a financial aid package from your chosen institution(s). This package outlines the types and amounts of aid you are eligible for, including scholarships, grants, work-study opportunities, and loans.

Thoroughly review your financial aid options and pay close attention to the terms and conditions of the aid offered. Take note of any requirements, such as maintaining a specific GPA or completing a certain number of credit hours. Also, research the specific terms of any loans you are offered.

Appealing for More Aid

If your financial aid package does not meet your needs, you have the option to appeal for more aid. Contact the financial aid office at your institution and explain your situation. Provide any documentation or additional information that supports your case.

Be proactive and persistent in your communication with the financial aid office. Sometimes funding becomes available due to changes in circumstances, and appeals can make a significant difference in your ability to afford grad school.

Tips for Minimizing Debt

Living Frugally During Grad School

One of the most effective ways to minimize debt is by adopting a frugal lifestyle during your time in grad school. Look for opportunities to save money on everyday expenses, such as cooking meals at home, using public transportation, and finding free or low-cost entertainment options. Consider sharing living expenses with roommates to reduce housing costs. Grad school is a temporary phase, and by making small sacrifices now, you can set yourself up for a stronger financial future.

Choosing a Loan with Favorable Terms

If you must take out student loans, carefully consider your options and choose the loan with the most favorable terms. Compare interest rates, repayment plans, and loan forgiveness options among different lenders. Opt for federal loans whenever possible, as they generally offer more flexible repayment options and protections compared to private loans. Carefully review all loan documents and consult with a financial aid advisor if you have any questions or concerns.

Paying Off Interest While in School

If you have the means, consider making interest payments on your student loans while still in school. By paying off interest as it accrues, you can prevent it from capitalizing and adding to your overall loan balance. Interest payments can significantly reduce the total cost of your loans over time. Even if it's difficult to make full payments, contributing what you can toward interest makes a difference.

Encouragement for the Journey Ahead

Paying for grad school is undoubtedly a challenge, but by proactively researching funding options, creating a solid financial plan, and staying resilient, you can achieve your academic and professional goals. Remember that investing in your education is an investment in your future, and the knowledge and skills you gain in grad school will propel you forward in your career. Embrace this exciting chapter of your life and forge ahead with confidence!

Frequently Asked Questions about How to Pay for Grad School

Is grad school worth the cost?

Whether it is worth the cost to pay for grad school depends upon your field of study. It is essential to compare your estimated education expenses against what you can expect to earn with a graduate degree in your specific career path. 

If you are looking to change fields or careers, a grad degree might be necessary to do so. Speak with professionals a few steps ahead of you and those already working on your dream career to determine how necessary grad school is.

Some graduate programs are partially or fully funded by the institution itself, which is often the case with doctoral programs. Other programs enable you to offset the cost of attendance through graduate assistantships, fellowship programs, or teaching assistant positions.

Can graduate students use the FAFSA?

Graduate students can and should use the FAFSA to apply for financial aid to pay for grad school. Institutions typically offer financial aid and scholarships depending on a student's demonstrated financial need. After applying for the FAFSA, you will find out what type of student loan you are eligible for and how much debt you can expect to take on for graduate study. Private lenders can offer more options for personal loans if your federal loans are insufficient, though these might have more unfavorable terms like no fixed interest rates.

How can I find scholarships for graduate school?

Graduate students and undergraduate students can find scholarships and grants here at Bold.org. You can find scholarships that match your demographic background, field of study, and interests, so take the time to explore these opportunities. Create a profile to get started today.

Here at Bold.org, we are committed to helping students reduce their use of student loans. Check out our Scholarship Blog for more financial tips and learn how to apply for scholarships today!

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