Ms. O’Bryant, 40, didn’t make any rash money moves, however. She and her husband budgeted for her education, and she took the necessary coursework over a five-year period.
Career shifts like Ms. O’Bryant’s typically require a skill boost and a sizable tuition tab that can be tough to fund, and an increasing number of workers are facing that reality whether they’re heading back to school to follow a passion or out of necessity.
Ms. O’Bryant’s shift was spurred by a new interest in healing herbs and holistic nutrition that began when her mother had a heart attack. “I was determined to help her eat healthy, and I started to look into herbs she could add to her diet to help,” she said. With an undergraduate degree in English, she was well aware that her about-face required some serious schooling, but she was willing to put in the time and money. “I kept playing at it, one course at a time.”
Three years ago, she resigned from her job and started her business, Wild Roots Apothecary, in an old apple packing plant alongside the Thornton River in Sperryville, Va. To date, her total out-of-pocket encore education outlay is around $10,000, which has come from the couple’s savings and tax refund checks, she said.
“The reality is that most encore career education goals are not that well planned out,” said Lisa A.K. Kirchenbauer, a certified financial planner and founder of Omega Wealth Management in Arlington, Va.
And the ultimate price tag can be considerable. A graduate course at a public four-year college can run upward of $700 per credit. A single course at a private college can top $3,300. A master’s degree can easily set someone back anywhere from $20,000 to more than $100,000. A certificate program might run the gamut from $3,000 if done entirely online to $12,000 for on-campus credit hours, not including textbooks.
While some students can cover tuition bills with personal savings, there are many resources available for adult learners, ranging from tax breaks to grants, scholarships, low-interest loans and reduced tuition.
“If you’re still employed, look to your employer for whatever tuition assistance they can give you,” said Roger Young, a senior financial planner and certified financial planner at T. Rowe Price in Baltimore.
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Roughly half of employers offer tuition assistance to employees, according to the Society for Human Resource Management. These programs can provide employees up to $5,250 each year, not counted as taxable income — and the contribution doesn’t have to be marked to a full-degree program.
This route, however, can be tricky if someone is eyeing the exit. Some employers may impose restrictions such as taking courses that relate to the current job and requiring an employee to work a certain length of time after taking the course.
Other employers take it up a notch. IBM’s Transition to Teaching program reimburses $15,000 of expenses to become certified as a teacher — an undertaking that Keith Gordon, 64, an IT software specialist, accomplished four years ago while working at IBM. To qualify, applicants must have been employed at IBM for at least a decade.
“I was able to take a personal leave for three and a half months to student teach,” Mr. Gordon said. “I also had security in knowing if it didn’t turn out to be what I thought it was going to be, I had a job to come back to.”
Since 2014, Mr. Gordon, of Darnestown, Md., has worked as a math, computer science and engineering teacher at Poolesville High School in Poolesville, Md.
Like Ms. O’Bryant, Mr. Gordon made his career transition gradually. To earn a master’s degree in teaching, he enrolled in one night class each semester for three years and took summer classes. He crunched the numbers to evaluate his financial position. “I wanted to be sure I could afford the pay cut — 60 percent — that a career change to teaching would entail,” Mr. Gordon said.
About one year before he retired from IBM, he consulted with a financial adviser to tweak his budget projections. “My wife, Sue, and I have been fairly frugal all our lives, making sure we saved up, so we did a little belt tightening, but there were no loans, thank goodness,” he said.
Ms. O’Bryant and Mr. Gordon took practical paths to adding skills without accumulating debt.
“I strongly encourage clients to transition over time and not take on huge amounts of debt which can be a heavy burden in later years,” said Sarah Heegaard Rush, a certified financial planner and senior financial adviser at Wells Fargo Advisors in San Francisco.
For many adult learners, though, student loans may be the only resource. There’s no age limit for a subsidized financial aid, and part-time students are also eligible.
The federal aid formulas don’t take into account home equity or retirement accounts. The amount a student qualifies for depends on factors such as your financial need, tuition costs and whether you’ll be a full-time or part-time student. The IRS Publication 970 is a comprehensive rundown of all the current tax benefits for education.
Noncredit professional certificates, though, do not qualify for federal financial aid, scholarships, grants or needs-based aid.
There are also tax breaks. Under the new tax law, for instance, student loan borrowers can still deduct up to $2,500 of the interest they paid directly from their taxable income. The Lifetime Learning Credit provides a tax credit of up to $2,000 to cover up to 20 percent of annual tuition, and students don’t have to be enrolled in a degree program. (The benefit phases out completely for married couples earning $132,000 and singles earning $66,000.)
With a low-interest federal Stafford Loan there is no age limit, and part-time students are eligible. For students pursuing an undergraduate degree, federal Pell grants are interest-free and don’t need to be repaid; the maximum award is $5,920 in 2018.
The I.R.S. website, the tax-benefits guide from the National Association of Student Financial Aid Administrators, and the Department of Education’s Federal Student Aid and Finaid websites offer in-depth details. Private student loan options can be researched at Edvisors.
Scholarships, discounts and grants for older students are usually offered by associations, colleges, religious groups, and foundations. Fastweb, an online scholarship database, provides details.
The American Association of University Women provides fellowships and grants for women going back to school. CodingNomads teaches coding boot camps which can run around $6,000 for a 12-week training program. Scholarships are available.
Home equity loans may be an option for some students, but under the new tax law, the interest on the amount borrowed is deductible only if it is used to buy, build or substantially improve the taxpayer’s home, and there is usually a set time frame when the entire amount must be repaid.
Retirement savings can also be tempting to tap. But many financial advisers caution clients against using retirement funds to pay education expenses. “Unless you’ve saved enough for retirement, this can be a very risky venture, particularly if your new career doesn’t pay a lot,” Ms. Rush said.
Nonetheless, it’s a possible source for adult students. I.R.A. funds can be withdrawn before age 59 1/2 and the 10 percent penalty is waived if the money is used for qualified education expenses, which include tuition, fees, books, supplies and equipment required for enrollment or attendance at an eligible educational institution. Regular income tax, though, is due on the amount withdrawn early from a traditional I.R.A.
Many 401(k) plans allow participants to borrow up to half the vested balance, or $50,000, whichever is less. Typically, the loans charge an interest rate that’s a percentage point or two above the prime lending rate. Similar rules apply to 403(b) and 457 plans. The hitch: Funds from a 401(k) will normally need to be repaid when the employee leaves.
Adult learners can also use money invested in a 529 college savings plan for courses at a qualified college or trade school. The program, run by the states, isn’t only for children or grandchildren’s college tuition. If a child doesn’t go to college, or leaves unused funds behind in an existing 529 plan, the person who started the plan can become the beneficiary and use the money for qualified higher education costs.
The simplest way to trim the cost might be to seek out options at community colleges. City College of San Francisco, for instance, offers a free program to all city residents. Some state schools offer free or discounted tuition for older students. For example, California’s state universities offer free tuition in their Over 60 Program.
Meanwhile, it’s possible to negotiate for an accelerated degree that can lower the cost. A college might waive some required courses because of “experiential” credit learned through work and life.
As for Ms. O’Bryant, she has no regrets about the thousands of dollars she spent on her second education. “I only wish I had a little more trust in myself and done it sooner,” she said.