A study released today by the HEA Group shows that 32% of graduate schools have students who, on average, owe more on their loans five years after entering repayment than they originally borrowed. This is as repulsive as it is … preventable.
We have discussed this multiple times in this blog and on our discussion board. Before pursuing a graduate degree, prospective applicants need to perform their due diligence. Perhaps there are non-financial reasons driving your desire to attend that program. That’s perfectly fine. Just be sure you can handle the debt load.
If you choose the wrong graduate school, you could find yourself drowning in debt!
If financial reasons are driving your decision, then be sure to look at the starting salaries of the program’s graduates. Chances are there is a wide range in the salaries. Will you be competitive for the higher-paying positions? Just as not every admitted MBA applicant has the same chances of landing a job on Wall Street, so too not every graduate from your targeted program will end up with a tenure-track position at a top school. Does the degree still make sense if your salary ends up being toward the lower end of the spectrum?
Be honest and realistic with this assessment. Don’t be afraid to seek out help. This is one of the key services we offer our clients, so they don’t end up with a debt-to-income ratio of 243.3%. (We’re referring to the general psychology program at Walden University which had the highest such ratio according to the HEA Group study linked above.)
And, of course, the big “elephant” in the middle of the proverbial room that shouldn’t be ignored is the quality of the school awarding these degrees. The schools that form the overwhelming majority of the HEA Group’s list are for-profit colleges and universities. While online degree programs have their benefits and the for-profit schools have valid arguments about accessibility and giving students chances other schools may not be willing to, the facts remain that the debt burden is generally much higher. A counter argument can also be made that the not-for-profit traditional colleges and universities are not willing to tarnish their hard-earned reputations by offering a degree that is going to do more financial harm than good to their alumni.
