debt and graduate school – why it’s a bad idea
Last Friday, we had a good discussion on how to pick a graduate program. One issue that came up was debt. I strongly recommended that people only go to graduate programs that provide ample funding. People disagreed (a little) so I wanted to take a moment to explain the underlying logic:
- First, about 50% of doctoral students will not earn a PhD. So it makes no sense to pile up debt for a degree you may not get.
- Second, about 50% of doctoral degree recipients will not work in academia or a tenure track position. It makes little sense to take debt for a job you may not get.
- Third, tenure track jobs have modest salaries. Professors aren’t poor, but we make a middle class salary, not MD salaries.
In financial terms, the academic career is high risk and low pay off. The pay off is mostly in non-financial terms. Once you understand that money is not the guiding principle of the typical academic career, then it makes little sense to invest money in it.
Of course, there are exceptions. For example, you may take out debt as “bridge funding,” to help you get through a particularly rough time. But that’s the point – the default rule for graduate school is “no debt.” You shouldn’t start off by taking huge loans. Only take them as a last resort and only in modest amounts. If you are a first or second year student, and you are covering tuition through loans, something has gone wrong – very wrong.
Personally, my graduate program did not fund me well but I was able to avoid much debt through a combination of family support, a tuition waver, external fellowships, teaching, and odd jobs. Only at the very end did I take out a small loan to cover me in the last year. The result is that my student loans are easy to service and I can concentrate on being an academic, the way it should be.