Many people who have recently found themselves unemployed may be thinking about going back to school. It isn't (or shouldn't be) and easy decision: School isn't cheap and the payback isn't certain. So, it's only reasonable to ask, "Is it worth it to go back to school?" (Learn how to go to college without going broke in 5 Ways To Fund A College Education.)

In order to decide if going back to school is right for you, make a list of what you would be giving up and another list consisting of what you would be getting in return. Here's how it might look:

What You're Giving Up

  • Money - College costs can range, depending on the institution involved. Local community college will obviously cost significantly less than private schools, so the key is determining how much this will cost, and if you can afford it. You may be able to find grants or scholarships, or even a parent or relative who may be willing help with part with tuition money. Do the work to see what a realistic budget will look like.
  • Time – If you are unemployed, you may have plenty of time right now. But if returning to work in the near future is a possibility, beginning a new education may be a waste of time.
  • Energy – Even those full of vim and vigor can get worn down by a full time course load, especially in higher level programs or when they haven't been in a classroom in a while. This means you won't have the energy to be doing other things. Also, consider the career you are pursuing when complete and what that may take out of you.
  • Opportunity Cost – Related to using energy for school instead of other things is the concept of opportunity cost. Because you can't do everything, you will have to give up certain things when you go back to school. Besides money, time and energy, make a list of what else you could do if you didn't go to school.

What You're Getting Back

  • Higher Earnings – This is the big one. U.S. Census Bureau data shows on average that bachelor degreed individuals earn almost twice as much ($2.1 million vs. $1.2 million) over a lifetime as non-college graduates. In 2000, the last Census data available, the average salary was $30,400 for non-graduates vs. $52,200 for bachelor degrees and $62,300 for graduate degrees. Of course, more professional degrees, such as an MD or JD, provide even more earnings as they averaged $109,600.
  • More Opportunities – For many companies, the college degree is what separates the pile of resumes. Even traditional jobs that typically didn't require a degree, such as a salesperson, are now requiring four-year degrees. Include the increased opportunities you will have when you complete you degree and what they mean to your life. For example, graduate degrees may mean the corner office of the executive suite or a profession degree, such as accounting, may mean your own CPA practice.
  • A More Interesting Life – If you have more money and more opportunities, it only stands to reason that your life will be more interesting. Be sure your lists includes all the things that could improve. More money could mean a nicer place to live, college for your own kids and extensive travel.

While this will cover most things, there are others that you should add to your list. For example, your love or hate of school itself, your level of motivation and your ability to finish what you start. Everything else that comes to mind should be noted for consideration. (How does your level of education relate to the bigger picture? Find out in How Education And Training Affect The Economy.)

Then compare lists, talk to those close to you, and think it through. Once you think you have made up your mind, sleep on it at least one night and make the final decision. Using this process will help you, but no one really knows if it's worth it except you.

Related Articles
  1. Personal Finance

    Is An Ivy League Degree Worth It?

    In 600 B.C. Aesop determined that a bird in the hand was worth two in the bush. Warren Buffett claims that this axiom can be used to determine the most valuable uses of capital. In this article ...
  2. Savings

    Should You Look at 529 Plans Outside Your State?

    529 savings plans are not restricted by geography. So if your in-state offering has high fees or poor investment choices, look elsewhere.
  3. Personal Finance

    10 Reasons It Is Time to Look for a New Job

    Learn 10 good reasons for switching jobs, such as major life changes, ethical concerns, job description creep and upwards mobility.
  4. Investing

    4 Billionaires Who Dropped Out of Harvard

    People who became successful despite dropping out of Harvard University.
  5. Credit & Loans

    Student Financial Aid Changes: FAFSA 2015-2016

    Here is a look at some of the major changes to FAFSA in 2015 - 2016 and how they will affect student financial aid.
  6. Credit & Loans

    What to Do When You Can't Repay Your Student Loans

    Student loans should be kept in good standing no matter what. Here are some tips on managing your loans.
  7. Professionals

    Common Interview Questions for Business Analysts

    Identify some of the most common job interview questions asked of business analyst candidates, and learn the responses that will make you stand out.
  8. Credit & Loans

    Student Loan Deferment: Live to Pay Another Day

    Extending your principal repayment date can increase your chances of fighting off default.
  9. Professionals

    Common Interview Questions for Compliance Officers

    Prepare to ace your compliance officer interview. Learn how to answer some commonly asked interview questions and what you need to know to come out ahead.
  10. FA

    CIPM: The Key To A Niche Career In Finance

    CIPM designates usually work as investment performance analysts.
  1. What’s the difference between the two federal student loan programs (FFEL and Direct)?

    The short answer is that one loan program still exists (Federal Direct Loans) and one was ended by the Health Care and Education ... Read Full Answer >>
  2. Does a financial advisor need an MBA?

    Obtaining a license as a financial adviser does not require an Master's of Business Administration (MBA) degree. The Certified ... Read Full Answer >>
  3. Student loans, federal and private: what's the difference?

    The cost of a college education now rivals many home prices, making student loans a huge debt that many young people face ... Read Full Answer >>
  4. Can I use my IRA to pay for my college loans?

    If you are older than 59.5 and have been contributing to your IRA for more than five years, you may withdraw funds to pay ... Read Full Answer >>
  5. Can I use my 401(k) to pay for my college loans?

    If you are over 59.5, or separate from your plan-sponsoring employer after age 55, you are free to use your 401(k) to pay ... Read Full Answer >>
  6. What are the best free online calculators for calculating my taxable income?

    Free online calculators for determining your taxable income are located at, and Determining ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Take A Bath

    A slang term referring to the situation of an investor who has experienced a large loss from an investment or speculative ...
  2. Black Friday

    1. A day of stock market catastrophe. Originally, September 24, 1869, was deemed Black Friday. The crash was sparked by gold ...
  3. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  4. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  5. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  6. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
Trading Center