Should I go back to school?

Is Going Back to School Worth the Investment?

Education can be transformative—or it can be an expensive detour. The difference is whether the math works for YOUR specific situation. Let’s calculate.

The True Cost of Going Back to School

Direct costs (what you pay):

Opportunity costs (what you lose by not working):

The full picture: A $75k earner doing a 2-year, $80k MBA:

• Tuition: $80,000
• Lost income: $150,000
• True cost: $230,000

That’s what needs to be recovered through higher earnings.

Break-Even Analysis: Years to Recover Investment

The formula:

Years to break even = Total investment ÷ Annual salary increase

Example scenarios:

Rule of thumb: If break-even exceeds 7-10 years, the financial case is weak.

The Opportunity Cost of Capital

What if you invested the money instead?

$60,000 tuition invested at 7% average return:

The comparison:

• Option A: $60k tuition → potential $20k/year salary increase
• Option B: $60k invested → $24,000 gain after 5 years

If the salary increase is modest, investing might win. If the increase is substantial, education wins.

But remember: Investment returns are uncertain. A degree is a tangible credential. And some career paths require the degree regardless of ROI.

ROI by Degree Type

MBA (Top 20 schools):

• Cost: $150,000-200,000+
• Average starting salary: $150,000-180,000
• ROI: Typically strong if coming from $60-80k
• Best for: Career changers, aspiring executives

MBA (Mid-tier/part-time):

• Cost: $40,000-100,000
• Salary increase: $15,000-40,000
• ROI: Moderate, better if employer-sponsored
• Best for: Current managers seeking advancement

Master’s in Computer Science/Data Science:

• Cost: $30,000-80,000
• Salary increase: $20,000-50,000
• ROI: Often strong (high-demand field)
• Best for: Career changers into tech

Master’s in Engineering:

• Cost: $25,000-60,000
• Salary increase: $10,000-25,000
• ROI: Moderate (may be required for certain roles)
• Best for: Specialization, management track

Master’s in Liberal Arts/Humanities:

• Cost: $30,000-80,000
• Salary increase: $0-10,000 (often minimal)
• ROI: Weak financially, may have other value
• Best for: Passion, academia, specific career paths

Law School (JD):

• Cost: $150,000-250,000+
• Salary range: $50,000-190,000 (huge variance)
• ROI: Strong for Big Law, weak for others
• Best for: Those committed to practicing law

Medical School:

• Cost: $200,000-300,000+
• Salary: $200,000-500,000+
• ROI: Eventually positive but long payback
• Best for: Those called to medicine (not for ROI)

The Part-Time Advantage

Full-time vs part-time comparison:

Part-time makes sense when:

• You like your current job/field
• You can’t afford lost income
• Employer will pay (tuition reimbursement)
• You’re good at time management

Full-time makes sense when:

• You’re changing careers entirely
• Top school is full-time only
• Networking/recruiting is crucial
• You have financial cushion

Employer Tuition Reimbursement

Average employer benefits:

• 71% of large employers offer tuition assistance
• Typical benefit: $5,250/year (tax-advantaged limit)
• Some offer $10,000-20,000+ annually
• Usually requires continued employment (1-3 years after)

The math with employer reimbursement:

$60,000 part-time MBA

• Employer pays: $5,250 × 3 years = $15,750
• Your cost: $44,250
• You keep earning your salary

This dramatically improves ROI. Ask your employer before enrolling elsewhere.

Alternative Paths (Without Degree)

Before committing to school, consider:

Sometimes the fastest path to higher income is:

• Switch companies (average 10-20% raise)
• Get promoted (negotiate hard)
• Learn skills on the job
• Build side income

Red Flags: When School Is NOT Worth It

Don’t go back to school if:

• Break-even exceeds 10 years
• You’re unsure what you’d do with the degree
• You’re going to “figure things out”
• Employers in your target field don’t require it
• You’re avoiding making a career decision
• You can’t afford it without crushing debt

The worst scenario: $100,000 in student loans for a degree that adds $10,000/year to your salary. At 6% interest, you’ll pay $133,000 over 10 years for $100,000 in extra earnings. You’d be better off investing the loan payments.

Making the Decision

Go back to school if:

• ☑️ Specific career path requires the degree
• ☑️ ROI calculations show break-even under 5-7 years
• ☑️ You’ve researched actual salary outcomes
• ☑️ You can fund it without crippling debt
• ☑️ Employer sponsorship is available
• ☑️ You’ve explored and ruled out alternatives

Don’t go back to school if:

• ☑️ You’re running from current job dissatisfaction
• ☑️ ROI is weak or uncertain
• ☑️ Experience could get you the same opportunities
• ☑️ It would require unmanageable debt
• ☑️ You’re unsure how you’d use the degree

The Bottom Line

Education is an investment, not an expense—but only if the return materializes.

Calculate your specific numbers:

1. Total cost (tuition + opportunity cost)
2. Expected salary increase (research real outcomes)
3. Years to break even
4. Alternative paths to same outcome

If break-even is under 5 years and you’ve researched outcomes thoroughly: probably worth it.

If break-even exceeds 10 years or outcomes are uncertain: explore alternatives first.

The degree itself has no magic. The value comes from what it enables you to do and earn.

About This Calculator

Salary data from Bureau of Labor Statistics, Glassdoor, and graduate program employment reports. Tuition costs from College Board and program websites. ROI calculations simplified; actual returns depend on individual circumstances, program quality, and market conditions. Last updated January 2025.