Will Going Back to School Solve Your Money Problems?

Returning to school is a big decision that often comes with a big price tag. Before you start school again, whether you are completing an undergraduate degree or going for graduate work, it’s a good idea to evaluate how you can best prepare to get the most out of it.

1. Consider the Investment

For many people, returning to school means taking on student loans. Before putting yourself in debt, you want to make sure it’s for a good reason. Going back to school can be an investment in your future. It can lead to raises, new opportunities and personal growth, but it’s good to identify what exactly you are hoping to get out it — qualifications for a new job, networking for a new career, etc. Once you have specific goals in mind, you can compare the price to what you will gain from the experience. Only you can decide if you will get enough out of going back to school to make it worth the investment.

2. Assess the Impact

Once you’ve determined the investment is worth the cost, it’s important to to figure out how returning to school will impact the rest of your financial life. If you will be returning to school full time, you may not be able to work full or even part time. With your income lowered, will you still be able to save for retirement? Or will you have to dip into your emergency fund to take time off work and return to school? There are options to explore like executive, night or part-time programs that allow you to continue working while getting your degree. Either way, it’s a good idea to try to figure out how the decision to return to school will affect your overall financial life.

3. Cut Back

If you planning to return to school, it’s a good idea to start saving as early as possible. You may want to take a good look at your budget and determine where you can cut back. Think about getting back into student mode. You don’t have to necessarily go back to eating Ramen noodles, but you may have to adjust your spending. Perhaps you will have to eat out or shop less. This might not be the best time to buy a home or make other large purchases. Of course, if you start preparing early enough, you can aim to save enough money to maintain your lifestyle.