Going Back to School? 3 Money Moves to Make


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Returning to school can be a smart investment in your future, but be sure to make these important moves first.

middle-aged man sitting in class room among youthful students

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Whether you started your college education and never finished it, or you graduated college but are interested in an advanced degree, there are plenty of good reasons to go back to school at various stages of life. In some cases, doing so can help you boost your earnings. In others, it can set the stage for a new and exciting career path that helps you feel more fulfilled. At the same time, returning to school can be a costly endeavor, so before you dive in, make sure to tackle these key money moves.

1. Set up a new budget

Depending on your circumstances, returning to school could mean facing a dip in income (in the event that you’re cutting your hours to work part time). It could also mean grappling with costly tuition bills, even if you do your best to choose an inexpensive school to attend. As such, you’ll need to rework your budget to accommodate your new set of financial circumstances. That could mean cutting back on some smaller expenses to free up cash, or it could even mean making a few drastic lifestyle changes, such as moving into a less expensive home.

Either way, make sure to redo that budget to avoid losing track of your spending and landing in unhealthy debt along the way. You might rack up some student debt once you go back to school, but you should make every effort to avoid unhealthy credit card debt .

2. Figure out how you’ll pay for that schooling

If you’ll be pursuing a master’s degree or finishing up your undergrad degree, then chances are, it’ll be expensive. Therefore, you’ll need a plan for how you’ll pay for it.

As is the case with undergrad studies, if you’re looking at grad school, you can apply for financial aid and see what student loans are available to you. It’s possible to take out federal loans to attend graduate school, and doing so is preferable to borrowing from private lenders, because with federal loans, you’ll typically snag a lower interest rate and enjoy certain borrower protections after the fact.

Another option? See if your employer has a tuition assistance or reimbursement policy. Some companies do, in which case you may be entitled to money for your studies that you don’t have to pay back.

You can also tap your savings account to cover some or all of your tuition costs. It’s certainly not a bad idea if you have a decent chunk of money to your name and you’re looking to keep your debt to a minimum. That said, make sure to leave your emergency fund alone. That money should be earmarked for unexpected bills, and if you’re making the choice to go back to school, that doesn’t count.

3. Apply for a new credit card if you need one

Some people are able to work full time while going back to school. But if you’re planning to scale back, your income will follow suit, and once that happens, you may have more difficulty getting approved for a credit card . Therefore, if you feel you could use an additional card, apply before your earnings take a hit.

This is an especially wise move if you don’t have a lot of money in savings. While charging emergency expenses on a credit card is far from ideal, it’s good to have the option, nonetheless.

Going back to school could be a rewarding experience that sets the stage for future success. Just be sure to make these money moves first so that you’re ready from a financial perspective.

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