financial discussions with the girl next door

Plans for Next Year – Graduate School or Work? March 9, 2009

Filed under: Uncategorized — girlnextdoorfinance @ 7:35 pm

I’ve mentioned a little before about contemplating grad school for next year. Here’s a little more about what’s going on with that:

I majored in a field completely unrelated to what I now want to do. I’m strongly considering grad school for Economics in the near future. I currently work on a college campus with a one-year full-time grad program in Economics, and I’m considering applying for a Graduate Assistant position for next year and participating in that program instead of working. I am moving to Chicago in summer of 2010, so I’m trying to decide what would put me in a better position for the move. I’d like to get a job in using Economics once there – some sort of data analysis.

If I work another year and put off grad school:
Right now, I am able to put over half of my paychecks into savings. If I stay at my current job for another year, I will have a very nice cushion for when I move to Chicago. Also, I am taking undergrad classes part-time on campus, and will have enough classes for a Bachelor in Economics by May of 2010. This means I will have a second degree, this one in the field I want to work in, before I move there, free of charge, and a great emergency fund.

If I do the grad program (and if I get a grad assistantship):
Well, obviously this would give me a Master’s in Economics. A GA here doesn’t cover tuition, but it does give you about $10,000 and requires 15 hours of work each week for the department. That $10,000 could be put toward living expenses or tuition (which is roughly that amount for the program). I would need to either take out student loans for other expenses or use up my entire savings (or possibly both).

To most people, the grad program is the obvious choice – it puts you (presumably) in a more advantageous position in the job market. However, I have two main concerns.
1. If the economy stays the way it currently is or gets worse, how long will it take me to find a job? Will employers be hiring anyone with a Master’s and no work experience? Would it be better to have a Bachelor’s, since employers can hire you for less (and likely doing similar work, since I’ll have minimal job experience regardless of which degree I have – does that give them more incentive to hire the cheaper labor?).
2. I will either have student loans to pay off OR zero savings, or possibly both upon finishing graduate school and moving to Chicago. Now that I’ve gotten used to having an emergency fund, the idea of moving somewhere with no backup plan is more than a little worrisome for me.

What are your thoughts?
What would you do?

I’ll post more updates on this over the next few months as I get more straightened out!


5 Responses to “Plans for Next Year – Graduate School or Work?”

  1. I would probably go with the double Bachelor’s vice the Master’s. If you could take one graduate class (rather than the whole program) then you could add the master’s degree to your resume as “X credits earned towards Master’s in Economics at XZY University.” It’s a credible excuse to show that you have the intention of going to grad school (without waiting for the interview to mention it). Just something to get it on their radar.

    I have a Bachelor’s in finance/econ and that was my plan for a couple years. Now I work in a field totally unrelated to economics and might go for a grad certificate in a different field.

  2. Dan Erwin Says:

    I used to consult to middle management, and now it’s exec only. However, one of the unspoken facts (and it is a researched fact) is that it takes a graduate degree to gain the insight into certain thinking skills. And in the new economy–an increasingly polarized job market, you will be rewarded for functional expertise (say, econ), plus the ability to perform expert thinking and complex communication. The ability to deal successfully with ambiguity, for example, is a highly developed thnking skill requiring graduate ed. Without those skills, you won’t get a decent wage long term.

    I know people will literally crawl at those statements, but that’s reality.

    So, I’d bit the bullet, and go after grad education in as good a school as you can get into. Schools are more and more willing to dicker on loans, grants, etc.

  3. Josh Wong Says:

    I’m kind of in the same position. I studied in a field that I will not be pursuing (Engineering) so I’m going back to school for Master’s studies in the field that I want (Business).

    Having said that, almost everyone I know who has done Master’s studies admittedly does it because they don’t know what else to do (and to avoid the “real” world for a bit longer). In this economy, it’s also about riding out the tough spot in terms of job hunting.

    However, you seem to know what you want, and it sounds like you’d really benefit from the Masters. If you choose the Masters, be warned: Do other extra curricular activities as well. As you mentioned, since you have little experience, you’ll need some differentiating factors to distinguish yourself from people with experience!

  4. Kevin Feasel Says:

    My advice would be very similar to Pete Boettke’s: go to the best school that will give you a full ride. Getting a master’s degree in economics can be a great thing, at least as far as intellectual development, but if a university won’t give you a full ride (even if this includes a teaching component), I would look at the next option on the list. I might personally make an exception for, say, Chicago or Stanford or Harvard (or a top-tier school), but even then, I doubt that you would get a positive return on your money if you aren’t going into academia for a living, and probably not even then.

  5. Ex Back Says:

    Hey, nice tips. Perhaps I’ll buy a glass of beer to that person from that chat who told me to go to your blog :)

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