Every passing year, the fight for good jobs gets harder as more and more qualified youth enter the job market. The natural trend of the world is an increase in median education levels, quality of life, and standard of living. Combine these two factors together, you get an ever so increasingly demanding job market. According to this article, 27% of companies have bumped up their educational requirements to a master’s degree that used to only require a bachelor’s degree. The above-average education qualification right now is a Master’s degree.

So, is a master’s degree really worth the investment? It takes a great toll on your finances as well as your time and energy to complete a master’s degree program.

In this article, we will attempt to look at the cost-benefits of obtaining a master’s degree depending on various situations you could be in.

What is a Master’s degree?

A master’s degree is an academic degree awarded by an educational institute upon completion of a course of study demonstrating mastery or a high-level understanding of a specific field of study or area of professional practice. Usually, a master’s degree program takes 2 years to complete, however, there could be programs varying from 1 year to 4 years.

Almost all master’s degree programs have an entry requirement of completion of a bachelor’s degree. However, some institutions may choose to forego this requirement based off of other entry requirements such as work experience or other achievements.

A master’s degree prepares you for the real nuts and bolts of the specific field you choose to do the course in.

Should you do a master’s degree?

A master’s degree is a pretty hefty investment on your part–both financially and with your effort. So, you should know what you are getting into beforehand.

A master’s degree is still one of the most respected educational qualifications in the corporate world. Most senior-level employees still prefer to complete a master’s degree for both their knowledge and for career advancement opportunities.

While it might be cool to say that you became after dropping out from university, the percentage who do so is minuscule. Some of America’s top CEOs such as Tim Cook (Apple), Warren Buffett (Berkshire Hathaway), Doug McMillon (Walmart), Andy Jassy (Amazon), Mary Barra (GM), and Sundar Pichai (Google) all have a master’s degree in either business administration or in their respective fields.

If you are doing a master’s degree to advance your knowledge, you should definitely go for it. There is a world of a difference between a bachelor’s degree program and a master’s program. A master’s program really focuses on a high-level knowledge accumulation and practical implications of the knowledge you have accumulated all throughout your education ladder.

If you are doing a master’s degree for career advancement, you should still do it. But, keep in mind that holding a master’s does not automatically land you better jobs with better perks. In fact, your existing workplace might not even increase your salary based on your completion of the degree. You must demonstrate the acquired knowledge in your workplace and show progress in your contribution to the organization to receive an increased perk in return. At the end of the day, you and your organization have a ‘trade’ relationship.

Before you commit to a master’s degree to pursue your dream job…

Before you spearhead your educational ladder, make sure to check the job market first. What is the job you want to be doing? Does this job require a master’s degree? Are there other ways to compensate for the lack of a master’s degree.

The broader/more common your dream job is, the more flexibility you will have in terms of foregoing a master’s degree. If your dream job is a very specific one that requires a very specific set of skills, and a master’s degree is one of them, you might not have much choice in this regard.

After all, life is about chasing dreams. If you really want the job, you will have to make some sacrifices to get it. 3-4 years of struggling is definitely worth a lifetime of happiness.

When should you do a master’s degree?

A master’s degree is more suited for a person who is already employed in an organization, for several reasons.

1. A master’s degree requires the application of the knowledge you acqurie into a real-world business/operation. Your workplace can be the perfect laboratory for this.
2. You will have a steady source of income from your employment to support your master’s fees (which can vary anywhere from $10,000 to $50,000).
3. Usually, a master’s degree does not add as much value for a new entree into the job market. You might seem overqualified for the entry level jobs that you will be applying for. Without work experience it is almost impossible to get into a senior-level position, where a master’s degree can really add value.

It might be convenient for a fresh bachelor’s student to continue education into their master’s degree. However, the return on investment you get on this is very little in the immediate years.

Of course, any of these can differ in the millions of companies out there. So, do your research upfront.

Also, it does not really make financial sense to commit to a master’s program towards the latter years of your employment. If you are 5 years away from retirement, this financial commitment might not have enough time to yield back. However, you will always have the extra knowledge if you want to use it in different ways after your retirement.

How much of a salary boost can you expect from doing a master’s degree?

First, there is no guarantee that you will receive an increase in salary just for completion of a master’s degree. The degree itself is a qualification for you to receive better pay. But, you still have to show how you can contribute more to the organization with these newly acquired knowledge and skills.

That being said, generally, holders of master’s degree programs tend to get paid higher salaries than those who do not.

According to an analysis by the U.S. Bureau of Labor Statistics, the median weekly pay for someone holding a master’s degree is around $1,545 ($3,090/month) whereas a person holding only a bachelor’s degree earns around $1,305/week ($2,610/month). The increment of $480 a month might not look like a lot (especially compared to the cost of a master’s program), but this is an extra $5,760 per annum and potential for senior-level employment opportunities (which pay more).

A quick search around the Internet gives a wide range of possibilities for salary increases. Some people have received a 10% increase in salary whereas some have been able to secure other jobs that pay a 60% increase over their previous salary.

According to an article by Harvard Business Review, a master’s degree can boost your salary potential by an average of 25%, some prestigious master’s programs can boost your salary by as much as 60%-150%.

With these averages, you might be able to arrive at some potential increment in salary that you can ensure at your organization or outside in the job market. This will help you to calculate the number of years it would take to recover your investment in to the master’s degree program.

Is a master’s degree in business administration (MBA) worth it?

Despite a specific field you are employed in, a master’s in business administration can add value to your general management skills which are in demand when you climb up your career ladder. When you reach the senior positions at an organization, the requirements become less of industry-specific knowledge, but more of overall business management skills. so, if you have plans to sit in managerial positions, an MBA might be worth your time and efforts. An MBA is one of the most sought-after prerequisites for senior managerial positions.

However, if you wish to become a chief science officer at an R&D company, you will be better off pursuing a master’s in science (MSc) in a relating field of study.

Conclusion

A master’s degree is certainly a value addition to your knowledge. No new knowledge is wasted. However, when it comes to the economics of this decision, the climate changes. The above factors we discussed in detail should be applicable to most of you out there.

If you have different circumstances and need further help, drop a comment below and we will try to evaluate your situation specifically.

If you have any feedback on the article, do not hesitate to comment below.