Grad School or Bust… Financing Your Future

So you’ve decided to go to graduate school. Great! Now all you have to do is figure out how you are going to pay for it. This can be a daunting task. The cost of graduate education has skyrocketed at universities across the nation and advanced degrees in the allied health disciplines are no exception. But the amount of financial aid available has also increased to a record $74 billion. Your goal is to figure out how to tap into this huge resource. As with most things, there are no easy answers. The cost of graduate education, the types of aid available and the resources available change from discipline to discipline, state-to-state and school-to-school.

However, the task will be far less daunting if you can break it into its parts. Here are a series of questions and answers designed to give you a brief overview and some quick guidelines for seeking financial aid for graduate education. Think of it as a starting point. The rest of the work is up to you. But it’s work well worth the effort.

I allready applied for financial aid as an undergraduate. Will it be any different applying for aid in Graduate School?

The application process really isn’t any different, but there are differences in what’s available. Pell Grants (the largest federal grant program) and other federal grant programs are not available to graduate students. Though it varies from state-to-state, graduate students are usually ineligible for grants from the state as well. However, as a graduate student you may be eligible to a source of funding not available to your less learned associates: graduate assistantships. These often come with a tuition waiver and a small stipend (usually around $2,500 per semester).

One more thing to keep in mind: parent information will not be taken into consideration when applying for financial aid. By virtue of a bachelor’s degree, you are considered independent, even if you still live at home.

What will my graduate degree cost?

As you might expect, the cost of a graduate education varies greatly depending on the degree you are seeking, the institution you are attending and the state were it resides. And remember, you need to think about more than tuition and fees when calculating education cost. There are the books and lab supplies that you must buy in addition to expenses for food, shelter and transportation—all of which you must pay for without the benefit of a full-time job. The financial aid or admissions office at the school you plan on attending can tell you what the cost of tuition and books will be. Cost of living information can be gathered from such Web sites as www.homefair.com and www.yahoo.com, but the best sources for this information are friends or family who already live in the area. Graduate education does not come cheap. Experts contacted for this article gave figures ranging between $30,000 and $60,000 for the total cost of a graduate education in an allied health field; perhaps significantly higher at very prestigious private institutions.

What types of financial aid are available?

There are dozens of potential ways to fund your graduate education ranging from scholarships and fellowships to employer assistance. Below are the highlights of a few of the more prominent methods to help you get started in your search.

Scholarships and Fellowships

Both scholarships and fellowships do not have to be repaid. Scholarships typically cover all or part of tuition and fees. Fellowships cover tuition and fees and include a stipend to cover a good portion of your living expenses as well. Institutional scholarships and fellowships are offered through most graduate schools. These are usually based on financial need and/or academic performance. At some institutions, scholarships and fellowships will last for your entire stay in graduate school; at others, you must reapply each year. Since this is free money, the competition is often fierce, but it never hurts to try.

And don’t stop your search at the college or program you plan on attending. A major source of both scholarships and fellowships often overlooked by students is third-party aid. Each year, graduate students receive millions of dollars in aid from religious organizations, foundations, labor unions, businesses and local groups. Students and professional organizations connected with your field of study are another good source.

These scholarships and fellowships may be given based on ethnicity, academic achievement, hobbies, talents or a combination thereof. In addition, national fellowships are available, such as the Fulbright, National Research Foundation and National Science Foundation. Information for each can be found on their respective Web sites. (See Sidebar).

Grants

Like fellowships and scholarships, grants are a form of financial aid that does not have to be repaid. But unlike scholarships and fellowships, they are only need-based, and they are given out by the federal or state government. Of specific concern to you, graduate students are ineligible for federal grants as well as virtually all state grant programs. Check with the financial aid officer at the school you plan on attending to be sure.

Assistantships

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Many graduate students become teaching or research assistants. Teaching assistants help professors by teaching labs, grading papers and meeting with undergraduates. Research assistants oversee labs and assist professors on projects. In exchange, assistantships provide stipends and/or tuition reimbursement. In some programs assistantships are awarded to every student, in others they are awarded according to academic performance. Not all graduate programs offer assistantships, especially in programs were the terminal degree (the minimum degree needed to work as a professional) is a master’s or above.

Employer Assistance

Occasionally, your current employer will pay for all or part of your graduate education, as long you can show that your coursework will contribute to the goals of the company. Within some high-demand fields, even if you’re not currently employed, you might be able to find an employer who will agree to pay for all or part of your post-graduate education if you sign an agreement to work for them for a specified amount of time upon graduation. Check with your supervisor or the human resources department at your current place of employment. It never hurts to ask.

Student Loans

Most graduate students must take out student loans to pay for at least part of their education. Loans fall into two categories: subsidized (loans awarded on the basis of need, which do not accumulate interest before you begin repayment) and unsubsidized (loans that accumulate interest from the time you receive them until they’re paid in full). There are a variety of loans available to graduate students including Stafford, Perkins and Federal Family Education loans, among others. To find out which ones you qualify for and which ones best serve your needs and purposes, see your local financial aid administrator.

How much can (and should) I borrow?

Graduate students are eligible to borrow $8,500 of subsidized or unsubsidized Stafford Loans and up to an additional $10,000 of unsubsidized Stafford loans per academic year. For their entire graduate education, graduate students may borrow up to $138,500. If you qualify for Federal Perkins Loans, you can borrow up to $5,000 each year and $30,000 total. The answer to how much you should borrow is easy: As little as possible. Even at reduced interest rates, student loans can be a huge burden after you graduate. With that in mind, only borrow when you need to and then borrow only what is necessary. Don’t fall into the trap of borrowing extra money to pay for the car or vacation you always wanted. There will be plenty of time to buy those things after you get out of school and land your first job. Most financial aid offices have online student loan calculators that will take into account such factors as amount borrowed, interest rate, and the estimated salary for your profession and tell you what your payments will be, the cost of your total payments and what you can afford. (See www.finaid.org, for an example of these calculators.)

Where do I get started?

Simply make an appointment with the financial aid office of the school you plan on attending. Applying for financial aid can be an intimidating and confusing task, and it’s nice to have an expert help guide you through the process. But you should also do a little research on your own. All of the information available to your financial aid officer is available to you on the Web. Or visit the financial aid Web site of the school you plan on attending for information or financial aid options specific to your program and state. One way or another, the money is out there to pay for your graduate education. Ultimately, it’s up to you to go out and find it.

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