Thought Catalog

Whether or not graduating school is worth the cost is a subject that’s rife with controversy. Depending on whom you talk to, getting a master’s degree or another advanced degree is either a great decision or a huge waste of time. The choice to attend graduate school is easy for future doctors and lawyers: they must have a professional degree to get started. But for someone who has chosen a path, for instance, in the area of economics and business, doing a postgraduate study is not a predetermined next step. A master’s degree is a qualification to be proud of, whatever your plans are. But for most students it’s also a big investment of time, effort and, of course, money, especially if you are an international non-EU student.

How much does it cost?

Pursuing a graduate degree can be a tempting opportunity; after all, you will likely improve your marketability when job hunting, increase your salary and expand your professional network. I often hear from my European friends: “Come on! It is only one extra year of studying, but it will make you stand out from the crowd once applying for a job.” And as much as I want to agree with them, I have recently been leaning more towards a “no” answer.  First of all, it WILL NOT make me much more exceptional among the other job applicants, over 70% of whom will also have a master’s diploma in their hand. According to the Digest of Education Statistics, the number of master’s degrees awarded has more than doubled in 2015. What could actually help you to be noticed by your prospective employer is a remarkable CV, with a couple of impressive internships, a few extra-curricular activities (such as team sports, student association, etc.) as a proof of your strong teamwork, time management, and communication skills as well as the ability to show your transferable skills. Is a master’s degree on the list? It would be definitely a plus, but will not necessarily help you to emerge among the rest of the applicants. Furthermore, yes, it is only one more year of studying, throughout which I could focus on a specific area in my fields of interest, gain more knowledge and experience, etc. However, it will also cost me an amount somewhere between 15,000-20,000€, not taking into account living expenses and rent. Definitely an investment that requires a second thought and a detailed cost-benefit analysis.

When deciding whether or not a graduate program is right for you, you may want to take a look at the return on investment (ROI) of your degree as part of your decision. So, the bottom line is: could a Master’s degree that will cost me on average 17,000€ (on top of the 27,000€ that I have already spent on my Bachelor’s degree) give me any benefits as a job seeker and eventually pay off?

Let’s have a look at the numbers (remark: the numbers are based on the assumption that I want to pursue my master’s in the Netherlands).

According to the official website of the UvA, a full-time master’s programme in Economics will cost me 14,950€ per year (a master’s in Finance will cost a non-EU student a bit more – 16,850€). Next, as suggest, the living expenses in Amsterdam, including rent, will lie somewhere between 900€ and 1400€ per month. This number includes insurance, accommodation, general living expenses, books and public transport. This sums to up to:

MSc Economics MSc Finance MSc Business Administration MBA
Tuition fees [1] 14,950 € 16,850 € 16,850 € 35,900 €
Living expenses
(per month)
900 – 1400 €
(avg. 1150)
900 – 1400 €
(avg. 1150)
900 – 1400 €
(avg. 1150)
900 – 1400 €
(avg. 1150)
Living expenses
(per academic year)
11,500 € 11,500 € 11,500  € 11,500 €
Travelling Costs*[2] 580 € 580 € 580 € 580 €
TOTAL 27,030 € 28,930 € 28,930 € 47,980 €


Around 28,000€, and almost twice as much if you chose to do an MBA! Quite a tidy sum, isn’t it? However, the actual ROI of your master’s degree truly depends on the destination and professional scope of your future job. If you were to stay in the Netherlands, then your postgraduate school will pay off in just over two years. Sounds like a positive NPV investment to me. Moreover, if you are an EU or a Dutch student, your master’s programme expenses would be even less, and therefore you will get a return on such an investment even in a shorter time period.

There are a number of factors you’ll have to consider for your decision of pursuing a graduate degree: professional goals, personal interests, and timing in life all play important roles. However, it’s equally important to weigh the financial implications of your intended program. Following your passion is important in life, but perhaps not at the cost of your financial security. On the other hand, you may have much to gain by completing your graduate degree.

Reasons to choose a master’s programme

Of course, there are plenty of intangible rewards that come with an advanced study that are not summed up to a number. Those are things I have already mentioned, like expanding your knowledge, networking, and social opportunities as well as satisfying your own passions. For some positions, a master’s degree is an essential entry requirement while for many others it is a highly useful one. Having a relevant postgraduate degree under your belt could give you a crucial competitive edge in a crowded job market.

The reasons obviously vary from one individual to another, depending on the/your personal situation and goals. Some undergraduates might consider building a teaching career or dedicate their whole career to research. Others aim for a placement in a particular field, e.g. investment banking or business/financial analysist, and choose a master’s programme accordingly. However, there are some common beliefs. For instance, some of my friends have decided to continue with their master’s in order to put off the job search. Others choose to pursue a postgrad degree to keep themselves skillful and marketable for career advancement. Perhaps one of the biggest reasons why recent undergraduates make a choice towards a master’s is still to boost their salaries. So, is there actually a big wage gap between undergraduates and postgraduates in Europe?

The good news is that studies across Europe and the US show that a master’s degree does actually provide an incentive for higher pay in the future. The table below from The Holland Alumni Network gives an overview of the average annual salary ranges for different degree types, and it is quite useful as a benchmark for future salary negotiations.

Bachelor’s Degree €24,000- €35,000
Master of Science (MSc) €26,000 – €48,000
Master of Business Administration (MBA) €30,000 – €60,000

As we can see, the lower boundaries do not change significantly, but as you gain experience in an industry (which can be pursued along with your main studies), you as a professional move towards the higher end. And here the difference becomes more noticeable. By means of simple mathematical manipulation we can see that a MSc graduate can earn nearly 27% more than a bachelor graduate, and a job seeker with an MBA degree (in his/her pocket) can boost his/her salary level up to 58% above that of a worker with an undergraduate degree. Quite a significant difference and an extra point to add to an argument for taking upon a master’s.

Do you really need a master’s degree?

The message I want to leave you with, and the belief that I am trying to stick to these days is: Don’t feel pressured into pursuing a master’s degree, don’t be afraid to take a gap year, or take upon an internship opportunity, or choose to do voluntary work instead of a year of advanced study. Do what feels the right thing to you. Everyone is different and has their own story, their own experiences. If, let’s say, you have decided that you are passionate about finance, and know that it is what makes you happy – then you are the lucky one among us. You found your path and you follow it. However, if you are not sure what you want to do and where you see yourself even in the near future – then take your time. After all, a master’s degree is undoubtedly valuable. But is it that for YOU?

[1] Differs at universities across the Netherlands

[2] The travel costs vary depending on a student’s home country. The plane ticket back home usually cost between 180-400€, taking an average equals 290€. Assuming that the student travels home twice during the academic year (during winter and summer break), travelling costs equal on average 580€.