Student debt continues to rise—doubling since the recession to $1.19 trillion—yet the topic of graduate school debt is rarely broached, despite the disproportionate amount of it. While only 14 percent of students in higher education are earning postgraduate degrees, their debt accounts for 40 percent of total student debt.
Don't become a statistic.
1. Know what you are paying for.
While this can be difficult for a degree that is not necessarily job-oriented like a Master’s of Fine Arts, check out the expected salary of the graduating class.
"Some people assume if you got an MBA, it pays for itself but it depends on the school," says Joe Mihalac, a millennial who decided to go to Harvard Business School after seeing that graduates' expected wages were between $90,000 to $120,000 in 2006. "Not every program commands that much money."
A good rule of thumb is to not take out any more debt than the expected bump in salary in the first year.
"If it is going to bump you from $70,000 to $100,000, the idea is to get through with no more than $30,000 in debt," explains JJ Montanaro, a certified financial planner at USAA.
2. Get creative with grants and scholarships.
The onus is on graduate students to find opportunities for funding. No matter what degree you are after, minimizing debt should be your number one priority. While funding varies widely on fields of study, it is important to think outside of the box in terms of scholarships.
"Do your research; there are opportunities out there to find financial aid that is not necessarily in the form of a loan," says Montarrao.
Even in fields like medicine, where scholarships are rare, there are monetary prizes through groups like Alpha Omega Alpha Honor Medical Society as well as opportunities for research grants for summer study through associations like American Heart Association.
3. Think about public service.
If you will be working for the government or a not-for-profit organization, there might be an opportunity to receive loan forgiveness for federal loans under the Public Service Loan Forgiveness Program.
Note that this program only works for full-time employees in specific fields who have made 120 qualifying payments.
4. Have an employer foot the bill.
From consulting firms to art museums, many companies offer programs that help employees pay for school or offer assistance with juggling a full-time career and part-time study. Approach your employer and see if it is possible.
"I think consulting firms just care about helping their people, so they are like, 'Oh, we will send them away, they will get this extra experience, they will do this internship in something else which will add to their creative thinking,'" says Darcey O'Halloran, second year student at University of Chicago Booth School of Business. "That is the investment that they are looking at."
5. Consider attending school part-time.
This option is not for every field of study, but attending school while employed full-time helps to alleviate the opportunity cost of being out of the workforce. It is also a good way to keep cash flowing in. School can be a big time commitment, so it is important to have a supportive employer as well.
But, remember graduate school isn't just about the money. A higher degree does open more doors.
"If I ever achieve even a modicum of success as an artist, it'll be a direct result of what I learned pursuing my MFA. It's a costly, ethically questionable enterprise, but I'm a better person and a stronger writer for having done it," says Carmen Pettacio, a writer living in Austin, Texas.
He received his MFA in Fiction from Columbia University. "I consider my money well burned."