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jbs02002
02-13-2008, 07:14 PM
Does anyone know whether econ PhD programs ever allow admitted applicants to defer enrollment for one year? I currently work in econ consulting, and I got an offer for a $150K plus bonus senior staff job at a new firm today. I really want to go to grad school, no question. However, earning that much money for one year would really ease the financial burden of grad school life.

I'm 24 years old now, and would be turning 26 soon after school starts if I did in fact defer. Obviously my decision will depend on where I get into grad school. I have gotten into Minnesota so far and am waiting to hear from the other schools I applied to. Any thoughts?

Mr.Keen
02-13-2008, 07:18 PM
Congratulations on your job offer. It is truly outstanding considering your age. Deferring for a year or two should not hurt you much and you can save enough money to go to grad school without any financial concerns.

savingtheplanet
02-13-2008, 07:44 PM
Doesn't hurt to ask. I tried to defer at Michigan last year, but they said no (because I was planning to beef up my profile and reapply to other schools as well). My sense was that they would have agreed if I had compelling reasons. I also know of somone who deferred at Wisconsin for a year.

Finally, if you get in to a bunch of places this year, I suspect you will get in again somewhere if you reapply. So maybe you could take that risk. (do you have a very strong profile?)

150k is a substantial sum of money -- you are unlikely to earn that much after your phd (even without considering discounting and interest rates) and credit markets are imperfect, so I would be sorely tempted too...

jbs02002
02-13-2008, 07:51 PM
Money isn't everything. I've been doing econ consulting for two years, and I know it's not what I want to do for the rest of my life. Nevertheless, there's an opportunity cost to going to grad school, and it just went up significantly for me.

A related question concerns funding. I have a fellowship offer at Minnesota. If they agreed to a one-year deferral, is it likely that my funding offer would go away? If so, the extra income won't be worth it because it will just go towards expenses I would not otherwise incur.

asquare
02-13-2008, 08:13 PM
Even if a school will let you defer admission, they typically will NOT let you defer your funding. Instead, they will reconsider you for funding the next year. You might get the same or a better offer, and you might not. You'd have to ask each program to be sure, but that would be my guess.

econphilomath
02-13-2008, 08:17 PM
Who cares about funding if you make 150k+bonus...the 20k is pocket change!

The question is, if you do take this job, are you going to actually do the PhD next year? I mean if you get offered 150k at 24, what is stopping you from getting an offer of 250k at 25?


I would bet that if you start deffering for money now, you will not do the PhD ever. Once you get sucked into $$ world , you never come back. (I hear its not that bad...)

jbs02002
02-13-2008, 08:27 PM
I'll worry about that when I get there. For now, the two options between which I am deciding are:

1) Start PhD in fall '08.
2) Defer enrollment for a year and start PhD in fall '09.

Besides, I can always come back to consulting (not that I would want to) after I finish my PhD.

buckykatt
02-13-2008, 08:28 PM
From what I've seen on some programs' web sites, it seems common that a one-year deferment might be allowed, with the stipulation that you'll need to re-apply for funding. So, it's easy to imagine a scenario where you come don't come out ahead if you give up a great funding offer now and wind up with little or no funding a year from now; but you could also come out ahead.

I think the bigger question is, if you defer admission for one year, will it turn into forever? And, if so, would that be a bad thing? Depends what you currently know about your preferences.

kartelite
02-13-2008, 09:29 PM
How 'bout you go to grad school and give me the job offer?

AstralTraveller
02-13-2008, 09:45 PM
How 'bout you go to grad school and give me the job offer?

I was just about to offer him the opposite: "enjoy your big bucks and let me take your place at UMN" ;)

jbs02002
02-13-2008, 09:48 PM
This is not an easy decision for sure. What would you guys do if you were in my shoes?

polkaparty
02-13-2008, 09:54 PM
What would you guys do if you were in my shoes?

I would go to grad school immediately. The longer you wait the more difficult it's going to be. If you want to be an academic, start on that path as soon as possible. If the job paid $1 million or even $500k, the answer might be different....

AstralTraveller
02-13-2008, 09:57 PM
This is not an easy decision for sure. What would you guys do if you were in my shoes?

Sincerely, I would first wait for the outcome of the applications process. If you are admitted at several places, it is a good sign that you'll be able to come back for your PhD next year (and maybe they agree to defer your admission so you don't have to reapply). If, on the contrary, you only get your UMN and/or lower ranked schools applications as admittances, I'd think twice if they don't defer your admission.

Anyway, if I were you, and if I were able to defer my admission, I'd go for that consulting job in a heartbeat, and would save the most of it for my grad years.

Good luck on any decision you ultimately make.

jbs02002
02-13-2008, 10:00 PM
Does that decision stand regardless whether you did not get into any schools better than Minnesota? Suppose I get no further admissions this year.

AstralTraveller
02-13-2008, 10:03 PM
Does that decision stand regardless whether you did not get into any schools better than Minnesota? Suppose I get no further admissions this year.

In that case, I would think about it a lot, and ask at UMN if they would be willing to defer admission. At the slightest hint of them saying "no", I would dump the consulting offer and the big bucks, and would go for my PhD. (better a bird in the hand...)

Best of lucks!

jbs02002
02-13-2008, 10:05 PM
I appreciate your replies. I don't think I've ever made a decision this tough in my life before.

AstralTraveller
02-13-2008, 10:06 PM
I appreciate your replies. I don't think I've ever made a decision this tough in my life before.

It sure is tough! But if you dream about academia, no bucks can take that away from you ;)

buckykatt
02-13-2008, 10:09 PM
This is not an easy decision for sure. What would you guys do if you were in my shoes?

If you're sure that you want to do an econ Ph.D., then I'd say don't defer. The increase in the present value of your future earnings as an academic might not be equal to what you'd earn over the next year, but there are other considerations. First among these might be that you're looking at a decade or so of sustained focus on first earning your Ph.D. and then tenure, during which it will be challenging to start a family.

If you're not sure whether you'd prefer the business world or the academic world, then working for a year first to give each a fair shake seems like a rational way to improve your information set.

jbs02002
02-13-2008, 10:24 PM
I've already been in the econ consulting world for two years. I have a good idea of what I want out of life as far as my career goes: research and teaching. This decision is primarily about money.

pevdoki1
02-13-2008, 10:26 PM
If you know you want to do research and teaching, go get a PhD at Minnesota. So you're giving up $150K/yr; the important thing is do things you enjoy. And you'll have enough money to support yourself (and more than enough once you finish graduate school).

savingtheplanet
02-13-2008, 10:27 PM
Sincerely, I would first wait for the outcome of the applications process. If you are admitted at several places, it is a good sign that you'll be able to come back for your PhD next year (and maybe they agree to defer your admission so you don't have to reapply). If, on the contrary, you only get your UMN and/or lower ranked schools applications as admittances, I'd think twice if they don't defer your admission.

Anyway, if I were you, and if I were able to defer my admission, I'd go for that consulting job in a heartbeat, and would save the most of it for my grad years.


I would do the same

polkaparty
02-13-2008, 11:05 PM
If you're not sure whether you'd prefer the business world or the academic world, then working for a year first to give each a fair shake seems like a rational way to improve your information set.

He or she has already worked for two years I think.

Regarding how admissions will influence the offer: For me, it wouldn't. Why? If your end goal is academia, working another year is not going to improve your profile. So if the best offer you get is Minnesota, you have to think what the best way to achieve your goal (of academia is). If you think taking a year to do a master's program or RA or something will help then maybe do that. Or just go with Minnesota...it's obviously a great school. But one thing is for sure, besides giving you a bit of a short term financial boost, taking the job is not going to help you achieve the goal of academia.

jbs02002
02-13-2008, 11:23 PM
I agree. I know that an extra year of work will not improve my profile. However, an extra $60K or more in savings would be a very helpful financial boost for graduate school.

asquare
02-13-2008, 11:37 PM
It depends on your discount rate and marginal utility of consumption while in graduate school. Assuming you retire at the same age whether or not you defer for a year, and that you eventually get tenure with a salary comparable to what you will earn by working next year (the slightly depressing nature of that assumption, I will not explore!), deferring or not deferring doesn't change your lifetime income much. It just shifts it back a bit.

If you care a lot about having money during graduate school, then go ahead and work. Otherwise, go to grad school now and earn money later. That's a matter of personal preferences. My own opinion is that if you are not supporting anyone else, then having money during grad school doesn't matter very much. Most of your friends will be equally broke, and you don't have a lot of time to spend money.

Also, and this is just my observation, everyone I've known who has deferred graduate school winds up wishing they'd started earlier at some point during the first year. It's completely irrational, but during the first year, your only thought is that you want it to be OVER. And the fact that if you hadn't deferred, it would be over already, just nags at people. Of course, the experience of being a first year would have been equally trying had it come a year in advance. As I said, it's completely irrational. But it's a common sentiment, at least among those I know who have deferred.

I'm all in favor of people working between undergrad and graduate school. I think it's important to know what your outside options are and what you want out of graduate school, and working can help provide that perspective. But if you've already worked and feel ready to go to school, then I'm not sure deferring really makes sense, assuming no serious budget issues in the short run.

jbs02002
02-13-2008, 11:42 PM
Thanks. That's good input.

Karina 07
02-14-2008, 01:39 AM
I agree with a lot of people's comments. If you know that what you want to do is research and teaching, and after graduating you'll get to do that -- well, getting to do one more year of what you like (well-paid) rather than what you do just to earn money sounds worth it, though of course it depends on exactly how you value these things.

Olm
02-14-2008, 02:36 AM
If you want to teach and research, then you must go straight into PhD.

$150k is a ridiculous amount of money, and if you weren't sure whether or not you wanted to teach/research or work, then I would say go for the big bucks. But if your heart is set on academia, then go for it right away, and don't wait!

flipecon
02-14-2008, 03:55 AM
hey buddy. you earn 150K? hook me up. lol. i need a job too.