Return on Investment for MS in USA

Ever-increasing tuition fees have necessitated students to look for courses and decide on schools that guarantee rewarding jobs and ensure a stable future and a good return on Investment.

The United States of America (USA) is one of the leading study abroad destinations for Indian students. According to the 2021 Open Doors Report, Indian students form the second largest group of international students in the United States of America (USA). If you have been thinking of pursuing an MS in the US, you need to keep several things in mind and the ROI of the course is the most important among them.

How is the ROI of An MS Calculated?

Higher education these days is nothing short of a long-standing investment and must be chosen carefully based on the security and perks it ensures. Return on investment is a fiscal calculation that reflects the degree to which the returns outstrips the cost involved. Return on investment is built on Human capital theory which believes in the great value of higher education in enhancing the productivity of an individual by the organized acquirement of knowledge and skill set.

There are several factors involved in the ROI calculation. The following pointers will help you understand the same.

• Tuition Fee and Study Costs: Let’s assume that an average tuition fee and living expenses for a student pursuing MS is $15,000 per semester. This would make $60,000 for four semesters. These costs may be high for STEM subjects.
• Salary and Taxes: Let’s assume that you make an average salary of $50,000 in a year after completing your graduation in the US. You will be paying 33% in taxes to the IRS. This would make your net income $50,000 – $16500 = $33,500. This would make your monthly salary $2,791 per month. Let’s say your monthly expenses, including accommodation, vehicle, and other expenses amount to $2000. This would leave you with $791 after all expenses.
• ROI: This is mathematically calculated as ROI = (Profit/Total Investment)*100. According to various studies, a post-graduate in MIS is likely to earn $10,000 more than a graduate. This would make ROI = 10000 /60,000 * 100 = 16.6%. Let’s assume that you have taken a loan for 12% from your home country and have to repay it monthly. This would leave you with 4.6% every month.

If your higher education guarantees long-term paybacks, lucrative job prospects and a bright future, then it is an investment worth making. While stakes are high and the cost involved are phenomenal, and you must clearly consider all aspects before taking a final call. A realistic understanding of the applicability of the degree earned, its apparent worth and the probability of getting a job are a few factors to be considered before enrolling in a foreign university.

To what extent the degree received will add value to the investment involved should be decided by considering the below-mentioned points into consideration.

• Programs that payoff: ROI depends on the discipline that you decide to choose for your masters. A degree in CS or EE will get you a fatter paycheque and well-paid jobs compared to a humble degree in liberal arts.
• Upcoming careers: The probability of landing up in money-spinning careers will increase with programs in upcoming fields which have abundant impending opportunities and are constantly generating promising jobs.
• Payscale data: Provides a vivid picture of thirty-year median pay data for close to 500 universities that a typical graduate from this university/school will potentially earn. While it gives a reasonably good insight into the expected salaries, it does not consider the cost involved in earning a Masters degree.