Student Loan Debt: Is it Still Worth It?

With the increasing cost of tuition and rising student loan debt getting more media coverage than ever before, one quote has emerged to perfectly sum up the issue. In an interview with Bloomberg, Dr. Steve Sherick finished his tale of life as an entrepreneurial, but debt-ridden, young doctor with the statement, “you have to be struck by a fairly insane sense of optimism that things are going to be better tomorrow than they are today.”

The same Bloomberg article places the collective amount of student debt in the U.S. at an all-time high: an incomprehensible $1 trillion. Among multiple problems, the article notes that self-employment, including entrepreneurship and small business creation, is at a corresponding low among the younger generation.

Maybe students are a little crazy to keep signing up for advanced degrees with full knowledge of the debts lurking after graduation, but they’ve been raised to believe that an advanced education is a key to success. So, right here, right now: are student loans worth it in order to earn an advanced degree? Does the old fashioned notion of making a better life for yourself by getting a higher education still apply today? Most importantly, will the benefits of a master’s degree compensate for the inevitable financial costs? There’s no one-size-fits-all answer, but some cold hard facts can help inform your decision.

The bad news is that the average student loan debt for 2011 graduates was $26,600, but this takes into account graduates at all levels. Those pursing master’s degrees are likely to add to their existing debt. Unless you have some serious savings, you will need to borrow, but your college should be able to help you. With the financial stresses on students building relentlessly, most colleges are going the extra mile to help you get the higher education you want. Colorado State University has extensive financial aid information and resources, guiding you through aid applications and the types of student loans available.

The good news is that those with advanced degrees still have a huge leg up in the job market as far as wages go. In recent years, bachelor’s degree holders earned 45% more than those with associate’s degrees; master’s degree holders earned 37% more than bachelor’s degree holders, according to a study by the Georgetown Public Policy Institute. Plus, those with an advanced degree have overall higher quality jobs than those without one.

Moral of the story? Yes, school is expensive, and the cost of higher education is going to keep rising; but if an advanced degree can help you progress toward a fulfilling, higher-paying career, chances are it’s still worth accruing some student loan debt to get there.