The New Minimum: A Graduate Degree And How America Pays For It

If things continue going the way they’re going, a graduate degree will become the new undergraduate degree. And that means more and more people will have to find ways to finance a master’s level education. These new expectations of grad school are just small part of the larger findings discussed in a recent study released by Sallie Mae and Ipsos, which also found that students are finding creative ways to pay for school at a higher level.

“It’s clear that for today’s student, grad school is becoming more and more of the expectation, and that’s driven by career aspirations,” says Ellen Roberts, a spokesperson with Sallie Mae. “Almost all (95 percent) say they need an advanced degree to succeed in their chosen career, and two-thirds (64 percent) believe an advanced degree is the new minimum standard level of education for any professional occupation.”

This is mainly because parental support dwindles and real-life challenges presented by young children and the care of aging parents enters the fray. Keeping all that in mind, just how does a student manage it all and still get a doctorate of that masters?

Largely, they pay for it all by themselves and supplement it with employee reimbursement plans or with federal grants and loans. While the average undergraduate school year of 2016-2017 cost $23,757, the average grad student school year cost $24,812. And despite that higher rate, grad students are much for “self-reliant” when it comes to paying for that degree.

Monica Wilczak is one of them. She worked full-time at the School of the Art Institute for ten years. And while matriculating through, she earned an art history degree for a fraction of the price. How so? She used her employee discount.

“[I] enrolled for the max number of credits they would cover each semester,” says the Chicago resident. “It took me three years for a two-year program, but I only had to pay for one class.”

Wilczak is like many students who find ways to finance an MFA or other terminal degree by sheer determination and strategic planning. Students at this stage in the game have figured out how to make the system work for them, says Carolyn Clark, an admissions manager for a major university.

“The students who pay cash out of pocket are mostly nurses who are fortunate enough to have a good tuition reimbursement plan,” says Clark, who represents a university that offers several master’s level courses. “And students in our education programs who study an area considered to be high needs fields are eligible to apply for a federal grant called the TEACH grant. Then we offer discounts up to 20% leaving anywhere from $7,500 to $13,000 remaining.”

The Sallie Mae study also discusses the numbers of students who are using grants and loans rather than parental support. An informal GenPop call-out on social media – to ask people how they are paying for their grad school education – brought 36 responses in a relatively short period of time.

A large number of people said they were using TEACH grants to finance grad school. Several nurses said they were also planning to work in a federally qualified underserved area because the federal government repays loans for people who take jobs in challenging areas. Many said they had tuition waivers via assistantships and stipends. And one respondent said she used unemployment benefits to go back to school “since I was getting a masters in a high needs area.”

“You have to agree to serve in a school that had 30% students on free or reduced lunch,” says Kathleen McInerney, professor at S. Xavier University who refers students to the locally-based ISAC program for repayment help. “That’s most schools in Illinois.”

To that Sallie Mae adds this: “Just like with an undergraduate degree, students should make an informed decision and really enter the process with eyes wide open,” says Roberts. “That also means understanding repayment and forgiveness programs, especially eligibility requirements.”

The 2018 Sallie Mae study also found that of all the races, black students filled out more FAFSA applications than anyone else and that white students had the ability to pay more out of pocket than anyone else. Additionally, the largest segment of black people earning a master’s or doctorate came from the southern states while the largest segment of whites earning the same degrees originated from the northeast. This study is a follow-up to the on-going undergraduate study, How America Pays for College, which recently released its 10^th edition.