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Many of the frightening stories you hear about millennials taking on staggering amounts of student loan debt — $50,000, $100,000, or more — are actually about graduate student loans.
Here are the latest statistics on average grad school debt among recent graduates in the following fields:
- Average MBA debt: $66,300
- Master of arts: $72,800
- Research doctorate: $108,400
- PhD in education: $111,900
- Average law school debt: $145,500
- Average medical school debt: $246,000
Read on for more details on how much debt students typically take on when pursuing a master’s, doctorate, or professional degree in various fields of study.
Quick navigation
- Average grad school debt by degree
- Master’s degree debt by program
- Doctoral degree debt by program
- Average law school debt
- Average medical school debt
- Graduate school debt by school type (public, private and for-profit)
- Trends in graduate school borrowing
- Annual grad school borrowing
- Average time to complete grad school
- Grad school debt and earning potential
- Interest rates on graduate school loans
- PLUS loans for law school or medical school
Graduate students represent just 14% of students enrolled at colleges and universities, but take out 40% of all federal student loans.
The amount of debt that graduate school students take on is determined not only by their personal finances, but the cost of attendance at their chosen school, and the type of degree they’re pursuing. But there are some limits on federal loans for grad students. Depending on the type of loan and degree, graduate students can borrow up to:
- Federal direct loans: $138,500
- Federal direct loans for medical, dental, or veterinary students: $224,000
- Federal PLUS loans: Up to school’s cost of attendance
Average grad school debt by degree
According to the latest numbers from the U.S. Department of Education, among recent graduates who borrowed to earn a post baccalaureate certificate, master’s, doctoral or professional degree:
- Average grad school loan debt: $84,300
The amount of debt varies according to the type of degree earned. Here’s the average cumulative debt for recent graduates who borrowed to earn the following degrees:
- Post baccalaureate certificate: $67,800
- Master’s degree: $66,000
- Research doctorate: $108,400
- Professional degree (includes law and medicine): $186,600
Analysis: The chart above shows cumulative student loan debt, which includes debt take on to earn their bachelor’s degree. Click on the tab, “Grad school debt only,” to see the portion of debt taken out for grad school.
Master’s degree debt by program
In addition to the type of degree, the amount of debt taken on by students can depend on the program or course of study they enroll in. Here are the latest numbers from the Department of Education on cumulative debt for recent master’s degree earners, by program:
- Master of education: $55,200
- Master of science (MS): $62,300
- Master of business (MBA): $66,300
- Master of arts (MA): $72,800
Doctoral degree debt by program (including law and medicine)
A doctoral degree is the most expensive type of grad school degree, but the debt that students take on can vary by program. Some degrees take longer to earn than others, and some offer students opportunities to defray their costs by teaching or conducting research while they’re still in school.
Here are the latest numbers from the Department of Education on cumulative debt for recent graduates who borrowed to earn a doctoral degree, by program:
- PhD (non education): $98,800
- Education (any doctorate): $111,900
- Medicine (MD, DO): $246,000
- Other health-related fields: $202,400
- Law (LLB or JD): $145,500
- Other: $132,200
Graduate school debt by school type
Another factor affecting how much debt students take on in the course of earning their degree is the type of school they attend — a taxpayer funded public school, a private nonprofit, or a private for-profit.
Here’s how average debt of recent graduates varies according to degree type and school:
- Post baccalaureate certificate: $67,800 (all schools)
- Public: $51,100
- Private nonprofit: $81,500
- Private for-profit: $97,300
- Master’s degree: $66,000 (all schools)
- Public: $54,500
- Private nonprofit: $71,900
- Private for-profit: $90,300
- Research doctorate: $108,400
- Public: $92,200
- Private nonprofit: $94,100
- Private for-profit: $160,100
- Professional degree (includes law and medicine): $186,600
- Public: $142,600
- Private nonprofit: $221,800
- Private for profit: $190,200
Analysis: In general, graduates of public schools take on the least debt, while those attending nonprofit private schools taking on more. While it’s not always the case, graduates of for-profit private schools tend to have the highest average debt.
Trends in graduate school borrowing
Even after adjusting for inflation, data collected by the Department of Education’s National Center for Education Statistics shows a startling increase in the debt taken on to earn some graduate degrees.
Here’s how much average student loan debt has increased since 1999-2000 for recent graduates earning degrees in these areas:
- Master of business administration (MBA): +40%
- Master’s (all): +57%
- Law school: +77%
- Medical school: +97%
- Research doctorate: 103%
Annual grad school borrowing
Although they represent only 14% of students enrolled in colleges and universities, grad students take out about 40% of student loans — $37.6 billion in 2017-2018, according to the College Board.
Even after you adjust for inflation, that’s still almost twice as much borrowing as was taking place around the turn of the century.
[ Jump to top ]Average time to complete grad school
Why do students pursuing professional degrees rack up nearly twice as much debt as those earning research doctorates, and close to three times as much as those earning master’s degrees?
For one thing, a master’s degree usually requires only one to two years of full-time academic study. Some students also hold down a job while pursuing degrees like a master’s in business administration (MBA).
Students who enroll in law school full-time are expected to graduate in three years, while medical school takes four years — plus an additional three to seven years as a supervised (and relatively low-paid) “resident” doctor.
A research or scholarly doctoral degree program is typically designed to be completed in four to six years, but often takes longer. Students take an average of 7.3 years after starting graduate school to earn their doctorate, and there’s considerable variation by field:
- Physical and earth sciences: 6.1 years
- Engineering: 6.5 years
- Life sciences: 6.7 years
- Math and computer sciences: 6.9 years
- Psychology and social sciences: 7.9 years
- Humanities and arts: 9.3 years
- Education: 11.7 years
Even though they may take longer than professional students to earn their degrees, students pursuing research and scholarly doctorates often have opportunities to work as research or teaching assistants, reducing their costs and need to borrow.
[ Jump to top ]Grad school debt and earning potential
Although many graduate students take on what seems like frightening amounts of debt, the degrees they earn typically provide an earnings boost that makes repaying their loans manageable. In fact, it’s borrowers who take out relatively small amounts of student loan debt, but fail to complete their degree, who are the most likely to default on their loans.
So graduate students need to weigh the amount of debt they’re willing to take on against what they can expect to earn with their degree.
As shown below, most students earning master’s degrees and research doctorates borrow less than $50,000 for grad school. But half of students earning professional degrees in fields like law and medicine borrow more than $100,000, and one in five students earning a professional degree takes out more than $200,000 in loans.
Although professional degrees often lead to higher levels of student loan debt, they can also lead to higher earnings that can add up over the course of a lifetime.
As the chart below demonstrates, a master’s degree provides a 26% boost in average salary compared to a bachelor’s degree. But workers with professional degrees earn about twice what their colleagues with a bachelor’s degree do, on average.
Among borrowers investigating refinancing their student loan debt, we’ve found that holders of advanced degrees in finance and public policy have more manageable levels of debt than doctors, lawyers, and pharmacists. Dentists, optometrists, and veterinarians are more likely to take on challenging levels of debt.
Interest rates on graduate student loans
Another cause for concern is that grad students pay considerably higher interest rates on federal student loans than undergraduates.
There are three interest rate tiers for federal student loans. Students taking out loans for the 2018-2019 academic year will pay the following rates:
- Subsidized and unsubsidized direct loans (undergrads): 5.05%
- Unsubsidized direct loans (grad students): 6.6%
- PLUS loans (grad students and parents of undergrads): 7.6%
Since 2013, rates for new federal student loan borrowers have been calibrated to 10-year Treasurys. As the chart below shows, rates have gone up for two years in a row.
Once you take out federal student loans, the rate is set for life. But the 1.29 percentage point increase in rates for new borrowers over the last two years translates into nearly $7,000 in extra interest payments for a borrower graduating with $86,000 in undergraduate, graduate and PLUS loans and repaying that debt on the standard 10-year plan.
[ Jump to top ]PLUS loans for law school or medical school
Because they are the most likely to hit the limits on Stafford loans, students seeking professional degrees in fields like law and medicine are also the most likely to resort to taking out high-interest PLUS loans. The most recent stats available, from the 2015-2016 academic year, reveal the percentage of students who borrowed by degree type:
- Master’s degree: 44% took out loans, but only 6% took out PLUS loans
- Research or scholarly doctorate: 31% borrowed, but only 6% relied on PLUS loans
- Doctorate in a professional field like law or medicine: 72% borrowed, but 42% took out PLUS loans
Tip: Interest rates on PLUS loans are currently 7.6%. Factor in the 4.248% upfront fee and the APR on PLUS loans can exceed 8%. Some students can qualify for better rates with private lenders — particularly if applying with a cosigner — although they’ll lose access to federal borrower benefits like income-driven repayment.
[ Jump to top ]Taking on extreme student loan debt
The chart below reveals that:
- 3 out of 4 borrowers owe $40,000 or less
- 2.7 million borrowers owe more than $100,000
- This relatively small group of 2.7 million borrowers owe $486.8 billion (about one-third of all outstanding federal student loan debt)
When students take on extreme amounts of debt, they often need to stretch their payments out over much longer than the standard 10-year repayment plan to make their monthly payments more affordable. The chart below shows the cost of repaying $200,000 in student loan debt in any of seven commonly use government repayment plans and compares those plans to refinancing into a private loan at a lower interest rate.
The calculations assume that the borrower starts repayment with $138,500 in unsubsidized federal direct loans for graduate students at 6.38% and $61,500 in PLUS loans at 7.44% (those are average rates for each type of federal student loan issued from 2006 to 2018).
Although income-driven plans like PAYE and REPAYE can lead to loan forgiveness, the amount forgiven is currently considered taxable income by the IRS (forgiveness granted through the Public Service Loan Forgiveness program is not taxed).
For high-earning graduate degree holders who can afford the monthly payments, refinancing into a loan with a shorter repayment term can be the quickest way to dispatch debt with the least amount of interest paid.
To help you get a better grasp of the numbers, we’ve provided the sources for all the statistics we cite to help anyone from journalists to students.
All of the charts in this article are free for you to share or embed on your own website, blog, or research paper.
Check out the other articles in this series, which look at the average time to pay off student loans, average student loan debt, average cost of college, and student loan default rates.
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