When to Go to Grad School and How To Tackle the Cost

Going back to school midcareer often involves financial sacrifices that affect the whole family. Still, there are things you can do to make it more manageable.

The first step is to figure out how much money you'll need to attend school, how much debt you can reasonably afford to carry and, most important, how much time you anticipate being without a regular paycheck while you pursue that degree.

To figure out how much debt you can shoulder, FinAid.org offers online calculators that will crunch the numbers for master's and doctoral candidates.

To get a feel for how long you'll be out of work, contact a financial-aid counselor at the school of your choice and discuss your goals. Determine whether it's feasible to attend night school and continue to work. Also, many fields of study require extended internships. Ask for guidance on how well these jobs pay, if at all.

Now add in all the collateral costs: Will you need more child care? Will your commuting costs increase? Will you have to pay for your own health care?

When you total it up, sticker shock may ensue. But relax, there is funding available to help ease the burden.

Search for financial aid.

One big mistake most adult students make is assuming they make too much money to get financial assistance.

Ask your current employer.

More companies are adding tuition-assistance programs to their benefits packages in an effort to attract and retain top talent. Some 81% of 960 companies surveyed offered some type of tuition-assistance plan in 2002, according to outsourcing and consulting firm Hewitt Associates in Lincolnshire, Ill.

But beware of strings. Many employers require assurances that you're enhancing your current skills, not training for a new career. And a growing number of companies are adapting the military's take on higher education: You sign a contract that says if your employer pays two to four years of higher-education costs, you'll continue working at the company for an equal or greater number of years.

Unionize.

If you, a spouse or a parent is part of one of more than 40,000 labor unions, you may be eligible for additional tuition-assistance programs, grants or scholarships.

Consider loans.

Despite low interest rates on federal student loans, many professionals may not be able to take advantage of them due to government loan limits. Many postgraduate students rely on private alternative loan programs from commercial lenders, such as Citigroup Inc. and American Express Co. But these programs typically charge a percentage point or two more than federal loans.

Tip: Leave that nest egg alone. Education is a long-term investment in yourself, so it might seem like a no-brainer to tap your 401(k) to pay for it -- whether you stay with your current employer or not. But borrowing from your retirement savings should be your last resort.

And don't forget, you have to be able to pay it back quickly -- typically within five years -- or you'll get hit with personal income taxes and a 10% penalty on the money.