Suze Orman's Warning For New College Grads: Maybe Don't Go Straight Into Grad School Just Because You Don't Land A Job

Graduating college is a major milestone — but this year, many students are stepping off the stage into an uncertain job market. In her recent blog post, financial expert Suze Orman points out that the current employment climate is being shaped by global economic shifts, including a tariff war and recession fears. As a result, some new grads are considering an immediate return to school instead of entering the workforce.

While that might seem like a smart move, Orman has a clear message: "Slow down."

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Why Grad School Isn't Always the Best Next Step

Graduate school can feel like a safe haven when job prospects are slim. The logic is easy to follow: get another degree, increase your qualifications, and come out the other side ready for better-paying work.

But Orman urges graduates to stop and ask an important question: How will you pay for it?

She points out that federal student loan programs allow graduate students to borrow significant amounts — up to $138,500 combined for undergraduate and graduate studies through the Direct Loan program. Additional funding is available through the Grad PLUS loan program, which allows borrowing up to the full cost of attendance.

Neither program checks whether you'll realistically be able to repay those loans, she warns. "That is crazy," Orman writes.

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Borrowing Limits Can Create Long-Term Burdens

Too much debt early on can derail future plans. Orman recommends following college financing expert Mark Kantrowitz's rule: don't borrow more for school than you're likely to earn in your first year of work.

For example, if your chosen field typically pays $60,000 a year starting out, your total education debt — both undergrad and grad — should stay under that amount. Going far above it could lead to a financial burden that sticks around for decades. Worse, it may push you toward higher-paying jobs you're not passionate about, just to keep up with payments.

Parents Should Think Twice Before Pitching In

Orman also cautions parents and grandparents not to compromise their own financial stability to help pay for a child's graduate school. "Being able to support yourselves throughout your retirement must be your priority," she writes.

That means family members should resist the urge to co-sign loans or dip into retirement savings for grad school costs. Instead, they can support their loved ones by encouraging smarter financial decisions.

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A Better Path: Work First, Then Reassess

Orman doesn't rule out graduate school completely. But she believes it's worth waiting. Working for a few years can give new graduates a better understanding of what they want in a career — and allow time to save for future education.

Plus, gaining real-world experience can strengthen future grad school applications and lead to better scholarship or employer-sponsored education opportunities.

In Orman's view, the key is to avoid rushing into more debt before having a clear plan. The goal is to make grad school a financially smart choice, not just a convenient escape.

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