Debt Levels

[unacclimated]

Hi all, I just thought I'd gage your thoughts on what you consider to be acceptable levels of debt to incur with a Master's program taken together with any previous debt from undergraduate studies. I was fortunate enough to have my entire undergraduate program paid for by an organisation so my debt level from academic study is currently $0 right now. However, the thought of taking out a student loan for a Master's level program has crossed my mind. Most intelligent people I know get their Master's degrees and Phd's paid for, mostly through departmental funding etc or research scholarships. Right now, my grades would probably not include those options as a possibility. Would borrowing $50k for two years of study be silly? 

[Therewillbeluke]

Well you're in a really good position actually with no undergraduate debt, so I'd say its really up to you and what you'd think you can handle.

[ridofme]

My first question is, how would you cover two years of a master's program with 50k? Based on the programs listed in your signature, you're probably looking at +/- 85k in tuition and fees, plus living expenses. I assume you have significant savings or some outside source of funding?

 

In general, I think it's hard to make a firm declaration on how much debt is reasonable, because it greatly depends on (a) what do you want to do with the master's, and ( what kind of lifestyle you are aiming for in the long-term. 

 

(a) If you want to go on to a PhD, then you have to consider the fact that interest will accrue on those loans while you're back in school. Then, the job market in academe is brutal, and salaries are crappy even for those lucky enough to get tenure-track positions. I don't know much about your field, but if you're pursuing a master's to prepare you for a career, and can expect a decent salary coming out (55k+ at an absolute minimum), then 50k debt could be manageable.

 

( Assuming you get Stafford loans (are you Canadian? - if so, I'm not sure if you would qualify) and your interest rate is only 6.8%, if you end your program with 50k in loans (including accumulated interest), this would mean a repayment of about $540/month for ten years.* That is a reasonable amount if you're earning $70k and expect your salary to go up over time. Less so if you're hobbling together adjunct positions and earning $35k while driving all over town. Other questions you want to consider: do you have or plan to have a family? Do you own or want to own a home? Will you become embittered as you see your friends from high school/college accumulate material wealth while you're still shopping at TJ Max and renting an apartment? Etc.

 

 

Most of what I just said has been discussed on these boards ad nauseum, so I apologize if you've already considered all of it. But I think a lot of it bears repeating. Also, as a master's applicant who is about to have to make potentially life-altering choices about debt, it felt good to talk (type?) it out! 

 

*This is the debt calculator I used: http://www.finaid.org/calculators/loanpayments.phtml

[crackthesky]

I think it partially depends on your long term goals.

 

Obviously, you are in an enviable and awesome position, having no debt to your name. Thus, you have options that most don't have and can work them to your advantage.

 

I think you should probably consider what you plan on doing with this graduate education. If your goal in life is to get a PhD and teach at a university, then the 50K investment now in a graduate program that will help to facilitate a funded acceptance into a reputable PhD program seems like it might be a good investment to make.

 

On the other hand, if you don't want to purse education further than a Master's level, then consider what job options will be available to you with that education and how manageable paying off that sort of debt will be should you be employed.

[unacclimated]

Interestingly enough I currently work for the Canadian government's federal student loan program

When it comes to repayment and all the other details I have a good sense for what is involved.

 

@ridofme, you are correct my estimates are a bit low ball if it was just an outright loan for all expenses.

 

At this point my plan would be to do a Master's and based on my performance I would move into either law school or further graduate study.

Law school seems the most likely option at this point. I have seen how difficult it can be to secure tenure with Phd's and Master's degrees from almost any reputable/top school. I know because many of the talented "lecturers" i have had in my undergrad program have let me know how rough it can be. It's not unusual to find people not just criss-crossing around a city, but moving to various cities across North America depending on the school and contract available.

 

My plan for the last year or so since graduating in 2012 was to get a salaried position and save money for graduate study. The salaried job didn't happen so here I am in the midst of applying to graduate programs and looking to leave the job market asap. 

 

Ultimately, taking on debt is one of those plunges I assume no one wants to have to make but I guess it's something I'll carefully weigh in the weeks to come.

Edited March 6, 2013 by unacclimated

[Neem217]

I can speak of two of the programs you applied to. I got into HDS and YDS two years ago. Both schools offered me packages that covered all of tuition. Harvard offered to cover tuition plus provide a stipend of almost 10k. I think Yale provided me with a smaller stipend. I chose HDS. I leave my Masters program with almost no debt. My offer from HDS is not rare. Many students here get the same offers. Actually, both of my roommates who go to HDS have the same funding I do. YDS generally has pretty good funding, too. I don't know how these school fund international students...

 

Just FYI, the estimate cost of attendance for HDS two years ago was about $46,910 (that's living expenses, tuition, books, fees, food, health insurance, etc.) They overestimate for somethings like books, personal expenses, etc. - but that's the number that they gave out. I say that it's actually less, though living in the Cambridge area can be very expensive. 

 

I honestly wouldn't borrow 50k for this degree. I know that a bit harsh of a statement, but that's a lot to take on for someone who wants to go into academia and knows that for the next 5 years, the only income I will have is a 19k stipend...and then who knows what assistant professorship position will be found after that. Should you get into a PhD and get an assistant professorship, then you'll finally be able to substantially pay off your debt, at the same time, while trying to establish a family, perhaps looking into buying property/a house, etc. A 19k stipend is not much in certain areas...

Law school, at least in the States, is not well funded and they do not give out much aid. The debt that law students here take on is immense, well over $100k. So, thinking ahead, it's a lot of debt to take on for both a MTS/MAR and then a JD. Divinity school just seems a lot of debt to take on if you aren't absolutely sure this is something you want to pursue as a career, and may be changing paths to do something else, such as law. Anyways, that's just my opinion as I finish up this program. 

Having said that, I do believe there's a good chance that you will get funding if you get in. Harvard gives at least 50% tuition to all its students, at least it has in the past. Best of luck! 

[coffeekid]

I'd only echo the advice here.

There is a weird principle for which I don't exactly have a name when it comes to things like this. When one thing works out financially (you get a big tax return), you suddenly think to yourself that it isn't worth it to do something that would otherwise be reasonable in helping your predicament (working a weekend job). True, the tax return makes life easier, but unless you can retire on it, nothing says you should coast on the other, sensible options.

All that to say: you're in a position that many people work many years to get to. So for all of our sakes, don't blow it when reasonable options are on the table. I know it might sound drastic, but even working an extra year and reapplying to see if you get better aid might be worth it. 

[luciernaga]

First, there is absolutely no reason to go into debt unless you know exactly what you wish to study, at which program (or programs) you would like to study, and have a clear sense of how this program will help you in your career (for example, set you up nicely for PhD programs etc.). Most good universities in the US have decent undergraduate funding and great PhD funding (of course, obtaining the latter is really hard). However, masters programs are generally understood to be the cash cow of these programs - funding is not great and hard to come by. The exception to this would be some M.Div programs (perhaps some others too, but we are in the religious studies section of the forum). Getting into debt is easy, getting out is not so easy, particularly if you follow a masters program with a PhD and/or an academic job. This is, of course, assuming that you actually get in to a PhD program and obtain a decent paying academic job - probability says these two things more than likely won't happen.

 

Similarly, in academia there is a sense of the rich getting richer (ok, everyone's poor, but bear with me). Most people who get accepted to fully funded PhD programs attended Masters programs with at least some kind of partial scholarship/fellowship. It's the same deal later in academia as well... most of those who get big grants are those who have already gotten smaller grants. It may be that you can't demonstrate that you merit funding at Masters level, but you think that if you work insanely hard during your Masters program then you will be able to show that you merit funding at PhD level. This is possible. But know that you'll be competing for spots against people who did obtain funding at the Masters level AND worked insanely hard throughout their masters programs.

 

if you are absolutely dead set on trying to make a career in academia (and many of us, against our better judgement, are), then I still wouldn't take on more than 20,000 debt for a masters program. Even paying the interest on such loans could be crippling during a PhD program. And you will probably never make a salary that will allow you to comfortably pay them off (and get married, buy a house, start a family, etc).

 

If you know what you want, be smart and go after it. But be realistic about the state of academia these days and how you can repay the loans you take out. Otherwise you may regret it later.

Edited March 6, 2013 by luciernaga

[Yetanotherdegree]

I'm a Canadian, now in the US. I did my first two degrees (BA and MDiv) at the University of Toronto/Toronto School of Theology. The tuition is lower there AND there was a ton of money for students so I left with only minimal debt from my MDiv (and I went in with not-stellar grades.) If you're worried about debt and $, then you should look closer to home for now, if someone will pay you to go to school for a PhD or similar, then by all means, branch out. But the debts I see here vs those of people I went to school with, well you wouldn't want the American option if you could have the Canadian. So no, 50K (and it will end up costing more) for a 2-year MTS or similar just isn't worth it. Find another way, either by taking another year to strengthen your application and then reapplying in the hopes of $, or by applying to somewhere cheaper with more money for students (TST? VST?)

[onoma]

If you think you will probably end up in Law school, why not do it now?  Why waste time and money on a religion degree that won't do anything for you?  Especially when you are probably going to be taking loans for law school, it seems unnecessary to waste your current debt-free situation.

[sacklunch]

You may consider doing a joint MA/JD degree (religion/law). Off the top of my head I know a lot of universities do this, especially ones that don't normally offer terminal MA's. WashU (in St. Louis) comes to mind, well as a lot of other top schools (I think Emory does, maybe Duke, too).

 

best

 

*edit* Also, I imagine this would make you a pretty competitive applicant, seeing that there has to be like...two (?) people a year who apply for those dual programs.

[unacclimated]

I enjoy religious studies and the humanities. I would like to study the humanities/religion once more before I go into professional studies and the workforce. It's something I'd be doing for myself. Law school would be for my parents

 

In addition, I would like to refine my academic skills and improve my profile for law school admissions. Many good Canadian and American law schools only accept 200 or so students a year. I am of the mind if you are going to bother doing law you should do it at one of the best law schools available. In my Province we have the University of Manitoba Law School which is not very good, if I can put it that way. 

Like most people attending graduate school, I just want to be able to say I got the most of the educational opportunities that were made available to me. 

 

I appreciate the feedback and should I be accepted at either Harvard or Yale a loan would be unnecessary.

Whatever fees/living expenses are not covered by each through financial aid would be paid for by the organisation that paid for my UG education. The loan situation would be for alternative programs I'm considering which offer no financial aid. However, the question itself is applicable to those in similar situations and thinking of applying to programs like a Mphil at Cambridge. In that situation, is a 70k loan worth it for the one year program? I myself could not justify that amount for a single year of study so I have steered clear of Oxbridge. 

Edited March 6, 2013 by unacclimated

[MsBOOM]

Not trying to be a downer on you right now, but I wouldn't 100% expect Harvard or Yale to cover ALL of your tuition. Two years ago, HDS was great with grants and stipends, but last year, the budget was definitely cut. It's no secret here that the second year MTS/MDiv students definitely got more covereage than the 2012 incoming class. Barely anyone I know was able to get full tuition coverage last year - let alone a stipend.

 

With that said, I hope you do get what you want and need!

 

Furthermore, if you get into HDS and apply at the Law School (and get in), you can do a joint degree in which you get a JD and MTS within three years. I believe you would end up doing one year at HDS and the following two years are at the Law School. I think Yale has the same option (although you might want to double-check on that)... I was very interested in crossing the two, but abandoned the idea once I realized I'm wayyyy too much of a softie to be a lawyer, haha.

[crackthesky]

I enjoy religious studies and the humanities. I would like to study the humanities/religion once more before I go into professional studies and the workforce. It's something I'd be doing for myself. Law school would be for my parents

 

In addition, I would like to refine my academic skills and improve my profile for law school admissions. Many good Canadian and American law schools only accept 200 or so students a year. I am of the mind if you are going to bother doing law you should do it at one of the best law schools available. In my Province we have the University of Manitoba Law School which is not very good, if I can put it that way. 

Like most people attending graduate school, I just want to be able to say I got the most of the educational opportunities that were made available to me. 

 

I appreciate the feedback and should I be accepted at either Harvard or Yale a loan would be unnecessary.

Whatever fees/living expenses are not covered by each through financial aid would be paid for by the organisation that paid for my UG education. The loan situation would be for alternative programs I'm considering which offer no financial aid. However, the question itself is applicable to those in similar situations and thinking of applying to programs like a Mphil at Cambridge. In that situation, is a 70k loan worth it for the one year program? I myself could not justify that amount for a single year of study so I have steered clear of Oxbridge. 

 

Not at all trying to be preachy, but if you're going to do law school for you parents, make sure it's for yourself, too! I can tell you from experience that it is exceptionally difficult to invest years of hard work into a program that you don't find yourself passionate about. It's not impossible, but it's no where near as gratifying as investing the time into something that you care deeply about.

 

If doing a JD and MTS at the same time would help to temper any reservations you have about law school, then it may very well be the best option for you!