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Strapped students

Graduate students face myriad financial challenges — some more obvious than others, says Susie Crowe.

Postgraduate education is a minefield of financial pitfalls — from tuition fees and loans to long stretches without contributing to savings. And yet many graduate students neglect to plan their finances accordingly.

The difference between starting a retirement plan in your early 20s versus your early 30s is in the hundreds of thousands of dollars. This realization hit me like a ton of bricks when I attended a seminar at my husband's workplace. At 28, I had long missed my opportunity to take full advantage of compound interest. Like many graduate students, I had spent my early 20s focusing on day-to-day financial challenges rather than on the big picture.

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There are smaller, often overlooked financial traps. They include interest charges from living off credit cards; fees for late tuition payments; library fines; parking expenses; and unintentionally paying for your own research because you have lost receipts for fieldwork or laboratory expenses (see Nature 501, 579–581; 2013). These seem trivial and short term compared with larger concerns, but they can mean the difference between comfortably paying your bills and barely scraping by.

Many expenses can be avoided or mitigated if you stay organized and remain on top of your finances. But in some cases, this is not so simple.

The money I am paid comes from so many sources it makes my head spin. Most students hope that income from teaching-assistant and research-assistant posts, external awards, internal scholarships, one-time entrance scholarships, tuition waivers and reimbursements will outweigh tuition and other fees, research costs, administrative charges, union dues and 'clawbacks' (funds that must be returned to a university administration owing to accounting errors). It can be tough for even the most financially savvy graduate student to keep a handle on things.

These days, my biggest worry is that my degree will drag on for longer than my current funding — a fate I have witnessed often enough to make every thesis setback seem like an ominous premonition. Sinking thousands of dollars into tuition for extra semesters is probably not a scenario envisioned by eager new students, but it is one of the more serious financial risks they can incur.

Given this bleak picture, what is a financially conscious student to do? The tired cliché of the impoverished graduate student is trotted out like a comforting inside joke, but it does not have to be the case. It is possible to make it through postgraduate education in decent financial shape.

Getting a head start in research was more important to my financial solvency than I initially appreciated. I got a job as a field assistant for an ornithology project early in my undergraduate studies, which gave me the skills to think up my own thesis project and led to a first-author publication in Animal Behaviour. This project gave my CV the boost it needed to get me a competitive national scholarship.

I try to be frugal and forward-thinking. It is important to be mindful of how tax laws apply to you — for example, in Canada, full-time students do not pay taxes on scholarships, but part-time students do. Choose a retirement plan early, and pay into it whatever you can. With compound interest, even the smallest efforts can yield big returns.

'Work hard and work smart' is a useful mantra. Efficiency buys time that can be spent on side jobs or business ventures to provide supplemental sources of income and a back-up plan if things go wrong. Students who stay focused and graduate quickly will avoid sinking money into extra tuition.

Be realistic. For prospective students put off by the financial difficulties that they may need to endure, I suggest thinking critically about whether a PhD will benefit you. Do the intellectual and career benefits seem worth the struggle? The hard truth is that if a prospective student has trouble defining what makes a PhD 'worth it' in the long run, then perhaps it is not.

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Crowe, S. Strapped students. Nature 507, 391 (2014).

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