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Is Going Back To School a Good Financial Decision?

8 minute read

David Ning

By David Ning

If the pandemic has taught us anything, it’s that no job is ever safe. I mean, how can there ever be job security when an external event can completely change the industry with no warning? The uncertainties of the job markets have led to a lot of adults deciding now might be the perfect time to head back to school. Whether its upgrade their existing education or to finally pursue a job in their dream field, college classes are seeing more older students than ever before. Since we’re a personal finance website, let’s evaluation the million-dollar question: is going back to school going to be a good financial decision for you?

The Covid-19 Impact

Before the pandemic happened, my uncle had a thriving restaurant. He told me how the restaurant probably wouldn’t have survived if it wasn’t for the generous government subsidies to helped keep things running at a bare minimum for about a year. This is just one small example of how any people were forced to reconsider their jobs in the wake of Covid-19.

I know plenty of others who lost their jobs (or saw their jobs change dramatically) due to the economic shutdowns. After all, nothing is more financially unsettling than being laid off from a long-term job. Or being forced back into the job market when you least expect it, especially when it seems like no one is really hiring for the industry you were in. For a lot of people, the pandemic became the perfect opportunity to go back to school.

Age Is Just a Number

It was the perfect storm for lots adults to head back to school. Whether they wanted to upgrade their current education or switch to something else entirely, the quick expansion of distance learning, online degrees, and more job specific training made going back to school more attractive than ever.

Despite that, there are always some serious questions to answer before you make the plunge. Since we’re a finance website, the one we will focus on the most is whether going back to school makes overall financial sense. Like most things related to money, it will depend entirely on your own personal situation. If you were making minimum wage while waiting tables, it may be worth it to change careers right now. On the other hand, going back to school is a commitment of a few years and tens of thousands of dollars. What should you do?

Does College Still = Success?

Over the last few decades, college has widely been seen as the path to middle-class success. In families that were on a socio-economic level below the middle-class, the sacrifices made to attend college was considered worth it. The thought was that a college education could bring someone out of poverty by transitioning them into a well-paying job. And for quite a while, that was generally true.

For those already in the middle class, college was seen as the ticket to the upper-middle class — or even wealth in the top socio-economic bracket. For example, my mother was always adamant that my sister and I go to school. She hoped we would be able to grasp an ever better life than our own middle-class upbringing. She was right, as our education gave us a platform to earn more income and improve our standard of living beyond my parent’s expectation. But does this path still work for everyone?

older students attending collegeShutterstock

Tides Are Shifting

In recent years, thee have been more doubts about the overall benefit of a college education. College is extremely expensive. Many students leave saddled with a great deal of student loan debt. On top of that, wages and salaries haven’t kept up with inflation and the overall cost of living. That means that even those who complete college are sometimes struggling to find jobs that pay enough to satisfy their loan obligations.

Even if you decide that going back to school is worth it, you still have to consider the pandemic. Many potential students are understandably still wary of bring on campus or attending in-person classes. So if your program is offered entirely online, will you get the same benefit from it? Are you willing to attend Zoom classes for a couple years, never meeting your classmates or instructors in person? Does the benefit still outweigh the costs?

Too Many Degrees?

One of the problems with having a college education is that the world is currently flooded with people who also have degrees. Some say that a bachelor’s degree is the new high school diploma. That is, it’s the bare minimum educational expectation for almost any job. With this type of “degree inflation,” you have to keep getting increasingly advanced degrees to compete. This only makes things more expensive. Getting a second degree or a Masters is great to make you stand out from other applicants. It’s also a lot more money, making the resulting student debt even harder to pay off.

It’s little surprise that many have become jaded about college degrees — especially those in areas of liberal arts, business, and social sciences. Instead, some of the focus is shifting to trade skills. While those degrees can still pay off, many are looking into other ways to make a decent living without a traditional four-year degree.

There Are Other Paths to Financial Success

Some of these paths include skills-based certifications and two-year degrees. Careers for mechanics, electricians, medical assistants, and many others often don’t include expensive college attendance. Plus, workers can start earning money much earlier. In some cases, they can even move into a higher socio-economic place with a good job and good financial management — no four-year degree required.

Others start their own businesses. With technology and the internet, it’s easier than ever to start your own gig and succeed at it. For many, there’s no need to pay for school when they have a good education from the “school of hard knocks.” Rather than having an expensive piece of paper that states they are qualified, they can instead point to years of experience in the field that is worth just as much (and maybe more).

If You’re Dead Set On Going To School

Learning and furthering your education are always important. Truly successful people never stop learning, even if their days of sitting in a classroom are long gone. You should never underestimate the power of having a good education. That being said, there are plenty of people who now question whether a college degree is still a requirement for a “good education.”

If you are on the fence on whether you should return to college, then here are some factors to consider. Ultimately, you need evaluate your own personal situation to determine if heading back to school is the right choice for you.

Consider The Future

If you’re still employed, that’s awesome. It can be tempting to feel indifferent to changes in the overall economy and job market, since they haven’t affected you directly. Luckily, planning to go back to college before you find yourself out of a job is much easier to plan more — especially financially. It gives you a cushion to put more thought into the decision. Look into the current state of your career and as yourself these questions.

  • Is the need for what you want to do stable in the foreseeable future? There are no guarantees, of course. However, you should do some research on the estimated demand for the job you’re going back to school for.
  • Do advances in technology, science, or practice indicate you will need more education to be competitive in the job market?
  • Will your salary be sufficient to earn a good living?
  • Will you be able to receive raises and advance your career down the road?

Consider The Present Too

College is a multi-year commitment. If you’re currently unemployed, you need to know how much going back to school is going to disrupt your finances. You don’t want to be saddled with unsurmountable debt. On the other hand, if your job is stable, you need to consider the implications of quitting (even temporarily), working reduced hours, or changing fields after you’re done school. The financial uncertainty can be quite scary.

One of the advantages of going back to college is that more education rarely hurts your earning potential. Even if you aren’t able to get a job in the exact field you studied for, any degree will automatically qualify you for a much higher caliber of jobs. It’s still better than only completing high school, after all. However, if you’re not financially stable enough to handle tuition payments (or more debt), your back to school plans may need to wait.

Middle-aged woman attending college classShutterstock

Student Loans

Although it’s always better to pay for college up front, it’s not always possible. That likely means student loans. If handled responsible, student loans can be a great tool for furthering your education. For example, federal student loans don’t start their repayment schedule until after you’ve left school.

Dropping your regular income to take on student debt and re-enroll in college can be financially scary. On the other hand, finishing your degree all at once (instead of doing it part-time, for example), might be the best choice. That way, you don’t have to make payments on your loans until you’ve graduated. In the meantime, maybe you can find the time for a temporary part-time job to help keep you afloat.

Pay As You Earn Loans

Speaking of federal loans, Pay As You Earn loans may be a good solution. They will help you handle the financial pressure of not being able to find a job in your new career field right away. If you qualify, PAYE loans only require you to re-pay up to 10% of your discretionary income. The program also includes debt forgiveness after 20 years.

There are many other ways to qualify for loan forgiveness as well. Don’t go crazy and drown yourself in student loans. On the other hand, don’t let cost be the sole reason why you choose not to go back for a degree. There are responsible ways to plan for student debt, without it becoming impossible.

The Bottom Line

Whatever your current career, considering more education in your field (or another field entirely) can be a lucrative decision. More education usually pays off in the long run. Figuring out the best way to get that for yourself is a worthy effort.

Here’s a personal example. I run a small web business. I also do some freelance writing on the side. I’ve carved out a nice little living doing these things. At times, though, it seems like I wasted years (plus tens of thousands of dollars) earning that Master’s degree in Engineering. But it’s not really that simple.

The truth is that I would have never have started the web business if it wasn’t for those programming classes I took in college. Plus I actually grew up in Canada. I would have never moved to the U.S. for my first full time job without that degree. So while I’m not working directly in the field of my degree, it was still totally worth it.

David Ning

Experienced Finance Writer

David is a published author, entrepreneur and a proud dad. He firmly believes that anyone can build a solid financial foundation as long as they are willing to learn. He runs, where he discusses every day money issues to encourage the masses to think about their finances more often.


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