Nov 7, 2009

How long would it take to save $150k?

All of the graduate programs I'm looking at will cost about $150k for 2 or 3 years. Thus, I want to save $150k before applying. Is that possible? How long would it take to, realistically, save $150k?

If I cut out things I don't really need... voice lessons, dance class, gym membership, etc, I could get my monthly expenditures down significantly. Still, $150k is a lot of money.

I don't want to take out loans. I don't want to graduate from grad school in debt. That seems counterproductive to fiscal growth.

I have $30k saved now, though half of that is my retirement savings. Do I want to touch my retirement savings? At least that doesn't count towards my FAFSA AGI.

Ok, so to save $150k ...

$12500 / month for 12 months (1 year)
$6240 / month for 24 months (2 years)
$2500 / month for 60 months (5 years)
$1250 / month for 120 months (10 years)

I bet I could save $1250 a month, but that means I won't be going to graduate school until 2020. And by then, tuition will cost much more. So this saving up for my tuition seems impossible.

Right now I'm taking in between $3,000-$4,000 / month.

Cutting out all extraneous costs, $1250 / month would be possible to save.

But then... I won't be saving for retirement in the next 10 years. I won't be saving for anything else. And I won't be living life. Oh, and I won't be able to afford to have children. Which all kind of sucks.

How on earth does anyone justify graduate school (unless it's all paid for?) How does anyone justify any education (I can't believe how much my parents paid for my undergraduate degree!) Then again, at the time my dad was making over $200k / year, which, even after taxes, made it possible to cover my $120k undergraduate education. They really should have made me go to the equally--good state school that I got into that would have cost a lot less, but I'm glad they didn't.

Now, looking at my future, I'm trying to balance how much my career is worth versus being in debt for the rest of my life. I realized that I missed the mark in terms of my undergraduate major, though even with the right major I lacked the maturity at the time to make the most of my education. Not that I partied a lot or anything, I just didn't want to be there. I didn't know what I wanted. I felt like I had to be in college because that's what you do after high school. I didn't really know WHY I was there. To get a liberal arts education? To get a technical education? Yea, it wasn't clear. I got a taste of a few different things, but now I really need some sort of focused trade-school-esque education to get where I want in my career.

Speaking of, I'm contemplating seeing a career counselor to help me figure out where that is. I went to my career counselor in college quite a bit, but he wasn't much help. Maybe the ones that cost $100/hr are better? Apparently it's normal for an INFP like myself to spend way too much time thinking about all the possibilities without ever acting on them. So I just need some guidance. An adult guidance counselor. I'm starting to think I need that more than therapy. I mean, I know my issues. And yes, I can work on them all my life. The daughter of an upper-middle class everything-is-fine-with-our-family sociopath and a narcissist is bound to turn out a little messed up, right?

I'm just SO TIRED of living my life afraid of failure in the eyes of my parents. I'm looking forward to paying for my own education because then, even if they look down on me for my choice, or roll their eyes at it, I know it's coming out of my wallet. It's my education to make the most of, not theirs. Not theirs to waste, either.

I went to a new therapist this morning... a first meeting intended to place me into a group for group therapy. I'm very interested in group therapy because much of my issues, especially those relating to my ability to succeed, are rooted in my complete lack of ability to communicate. It is painful because I know I come off like this conceited bitch because I'm terrified of giving compliments even though in my head 99% of what I'm thinking is a compliment and 1% is "you could just tweak this one thing and everything would be even extra special great." How on earth do you say that without coming off like a suck up? Agggh.

Well, I know I've completely failed on the communication end in my current company. I've learned a lot from my mistakes, yet I still make them, and no one really wants to hear my thoughts anyway. Because they are often inspired by a gut feeling more than solid research, so their standpoint is beyond fair.

I just have concluded that ultimately I need to be in a job where I am a problem solver. I am always bursting with solutions and to not be allowed to say them (even though I often do anyway, to the disappointment of my coworkers) is suffocating. I know my ideas are not always right, but I love to collaborate and throw ideas out, bounce off other people, turn an idea into a solution.

I've spent my free time this week reading about countless masters programs. MBA programs. HCI programs. ID programs. Design masters programs. With a foundation year for people who didn't major in design in undergrad. International programs. Online programs. Part-time programs. Dual degree programs. Weekend and evening programs. Programs that can only be completed if you stand on your head and clap five times while hunting wild boars. (Okay, okay, I haven't found that last one... yet.) I am overwhelmed by all the options and the potential cost of all those options. Any of those options.

All the stress is enough to have me retreat into the status quo forever. And maybe that's what I'll do. Or maybe I don't need grad school to do what I want. Maybe if I can just believe in myself enough I can take a few design classes, get a portfolio together, and shift my career trajectory. I don't know. I'm obviously more confused than ever. It's the typical quarter life crisis. Except I kind of know what I want. Or at least I know I want to be solving problems. To be in charge of solving problems. Creatively. I'm most comfortable as a leader, not a follower, but I need a team of equals. I wish I had some realistic support. I won't get any from my parents and my boyfriend doesn't understand the financial consequences of grad school... his mother is going to pay for him to get a graduate degree if he doesn't get a full ride (his undergrad education was much cheaper than mine, so it makes sense that his mom still has money left over for his graduate education.)

I just wish someone sat down with me in senior year of high school and forced me to take a year off and work before going to college. I wish someone explained why despite "liberal arts" magical allure, ultimately you should be using college to get the skills you need for a job. A job that you'll actually like. Not just one you're qualified for because you have a BA.

Anyway, that's enough rant for tonight. I hate that I always sound so spoiled. I just want to pay my way through graduate school, work hard, and feel like I own my successes and my failures. I want to own... me.


Jacob said...

If by living life, you mean earning and spending money, grad school is probably not the best idea. If you by living life mean studying something that is immensely fascinating to about 5 other people in the world, grad school is exactly where it's at. If you have that kind of interest and focus, saving 2500-3500 on your income should not be a problem---just start living like a grad student now---and in that case it would only take a few years.

Before signing over your life to the ivory tower, you might want to read this for a while

calgirlfinance said...

Couple of thoughts:

1. Try saying something like "this is great and it will be even more fabulous if you change x,y,z." I remember reading somewhere that you if you say "this is great, but . . ." then it take the wind out of the complimen with the but. With the and it doesn't deflate the compliment.

2. $150K seems like a lot for grad school. . . .You can buy a house in many places (but not the Bay Area) for that kind of money.

her every cent counts said...

@Jacob thanks for the thoughts. My income is about $3300 a month after tax, with anything extra I can scrounge up doing freelance work (usually $100-$500 after taxes). So saving $2500 to $3500 of my income is, well, pretty much all of my income. My grad study won't be PhD, it will be practical, definintely, which is why it's worth it to me. I'm strongly leaning towards a masters in design. I am not looking for a salary pay increase, merely to gain the skills and experience to sculpt my career path. I'm also contemplating an MBA, because I'm very interested in product management. Either way, those programs are pricey, and general terminal degrees at the masters level.

You're right, though. If I want to go to grad school, starting by living like I'm a grad student now would help a lot in terms of finances. I've decided to finish my "spending" by winter, then to move to super-frugal mode and see how much I can scrounge for the coming years.

@calgirl 1. you're right about the compliment strategy. I tend to skip the "this is great" because I feel like a broken record saying it. I worry if I keep saying things like "this is great" it will deflate the worth of that over time. I also manage to say it in such a way that still comes off as not a complement.

2. $150k is a lot, but probably still not enough to cover the grad programs I'm looking at. Which makes me wonder, who affords these? At a salary of 70k and 30k in savings, I'm not going to get any subsidized loans. I'm looking either at MBA programs (2 years, $50k / year plus housing, eating and such) or MDes programs w/ 3 years to make up for my lack of a design education (they tack on a foundation year at the beginning to get you up to speed). MDes is the more expensive degree because it will take 3 years. There are a few programs I'm looking at that are 3 years that offer a dual MDes/MBA. Either way, that's $50k a year at least, for 3 years, or $150k. I don't think I'll ever be able to afford a house in the Bay Area, so what's the use of saving for that? At least grad school is somwhat obtainable.

Anonymous said...

I am currently an MBA student, and I entered with a salary of approximately 70K and 30K in savings, just like you. I got lots of financial aid, including a sizable scholarship, the government max on subsidized Perkins and Stafford loans, and the government max on unsubsidized federal loans. I don't know if that was just my school, but it may be helpful to talk with a representative of the programs you are looking at before you assume the financial consequences!

Also, don't think of the debt as a bad thing like debt for a car or a vacation. Unlike a liberal arts degree, an MBA is an investment in your future which should pay off quickly in the form of a higher salary and better career track. And you are better off doing it now before you get "stuck" in a current career. Basically, you ARE saving for this education over a 10 year period--using borrowing just lets you flip the order to when the education benefits you the most!

Sallie's Niece said...

I can relate to your feelings about wanting to please your parents and think it's admirable that you want to save and pay for grad school yourself. I wished I had saved more before pursuing my grad degree myself. That being said, I don't think I would have saved every cent for ten years, that doesn't seem realistic to me. Do you even need a grad degree to do design? Can you just take a couple of classes? I would definitely continue to check out all of your options. Good luck!

SeeJaneGetRich said...

Hmmm.. I wish I knew how the heck I am supposed to find something that I love or even like to do. Taking a year after high school would not have helped me becuase entry level jobs at the level would be retail or fastfood.

sarah said...

What programs are you looking at that are the mdes/mba?

the ones ive been able to find are the iit and cca programs, are those the ones you are looking at or are there others?

her every cent counts said...

@sarah primarily looking at IIT. Also Bentley University outside of Boston has an HCI/MBA dual degree.

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