How Much is Graduate School Worth?

My husbands niece has applied for graduate school. She is the same age as our oldest daughter, who is also heading to graduate school. The only difference is when asked our niece has a clear cut plan to the job she will love. Her career choice requires graduate school. As it should.

In contrast, when we inquire of our oldest her intentions, she shrugs with a response like "I don't know what I want to do". Drives us crazy. How do you make such an immature choice. She is 21 going to be 22. She should know better. You don't go to graduate school without a clear plan.

Yesterday, to our horror, she announced to all that she is thinking of become a "life long student". That is the quietest I have ever heard our family dinner table. What can we say? She is an adult, at least by age. She will not be receiving any regular funds from us after the graduation this coming spring. So, I guess she makes her bed.

It is very hard for us to take, but we have no place here. Her mother is the only one she will listen too and her mother ended her life long college career at the age of 42. The only difference is her mother had an ex-husband paying for it. I wonder if she realizes this??

Anyway, our hard working niece on the other hand is making the accurate choice. The issue comes with where to go. She has been excepted at a private college with a tab that will run her into debt to the tune of $250k, when all is said and done. Ouch. She has also applied for a state school program and is hopeful for acceptance.

The problem now, comes from needing to ensure the education. She will be accepting the offer from the private school and paying the money to secure her slot. then should she be accepted at the other schools she will lose this money, but save in the long run. Evidently, the graduate classes are about 1/2 the price. Big difference.

My concern is her chosen career is not a "doctor" but a position that will only yield her a $50k to $60k beginning salary and she will be living with a quarter of a million in student loans. Talk about Sallie Mae taking up residence in your home. If she doesn't marry a well to do young man, she will be paying on this until retirement.

A 3% loan, for 30 years with a principle balance of $250K will set her back $658.34 per month. Should she grab a job paying $60k a year, that is $5k a month gross. With a 28% tax level, she will bring home $3600 a month. That means 18.28% of her net will be going to Sallie Mae. Holy Cow. Don't buy a house, car or utilize any credit.

Sure, she can do this and succeed. She is a beautiful, intelligent, going for what she wants, confident, and hard working young lady. I do suspect high levels of success from her.

I can't help but wonder.....if a $250k debt, is worth a $60k salary.

On the other hand, I wish DD1 had this kind of drive and commitment to her future. Instead, I think she is milking her divorcing parents to remain a lazy child with little or no ambition. Sad for a child with a 36 on her ACT.