College can be a serious investment, and students should be sure they’re getting the most for their money. The rise of online learning has presented both students and schools with a cost-effective alternative to traditional degree programs, but are online degrees worth the money and time they entail? Below, we explore the cost and potential ROI of an online degree program , as well as additional ways students can save on their education.

1. What is the cost of an online degree?
2. How much does an online master’s degree cost?
3. Are online degrees worth it?
4. Are online graduate degrees worth it?
5. Is there financial aid or scholarships for online degrees?

What is the cost of an online degree?

Online education certainly has its advantages, especially where program availability and convenience are concerned. Do these perks cost more? Not necessarily. Online schools tend to be just as diverse (in cost and scope) as traditional programs, and in some cases, schools offer the same courses, online and off, with little to no surcharge. Even when an online degree is priced a bit more steeply, students tend to save money in other areas, like gas and fees. They may also be able to work — and, therefore, earn — more, thanks to the flexibility of Web-based classes. In other words, there are few absolutes when it comes to comparing the cost of online degrees and those earned in a classroom, and each student’s situation is wholly unique. Nonetheless, there are some general trends when it comes to education costs. Here are a few to consider.

Online vs. traditional degrees: A cost comparison

Online education is growing in popularity, both among students and colleges. According to a 2014 survey entitled “Grade Change: Tracking Online Education in the United States,” published by the Online Learning Consortium (formerly the Sloan Consortium) in partnership with Babson College, over 90 percent of participating college and university leaders said online education is “critical” to their institutions’ long-term strategy. This accounts for a diversity of public, private, and for-profit colleges of all sizes and prestige, including two-year, four-year, and graduate institutions. That means that many of the schools offering online degrees also host traditional, campus-based programs. For reasons we will discuss below, these online courses often cost less than traditional classes.

So, how much does an online degree cost? The following is a breakdown of just a few generally well-known schools offering both online and traditional degrees. For simplicity’s sake, we have chosen to focus on public, four-year universities. Please note that figures may not include all applicable fees. Tuition schedules can and do change, so students should always consult institutions directly for current costs.

Students should remember that when it comes to college costs, institution types matter. It is not uncommon for two-year community colleges to offer at least some online courses, often at the same rate or less as it would cost to take the same courses in a classroom, and far less than a comparable course at an Ivy League school. The chart above shows that when it comes to public four-year schools, online bachelor’s degree costs are often lower than those of traditional degrees. Note that in the case of private nonprofit and for-profit institutions, tuition and fees are less predictable, so it pays for students to do their research before applying to any program.

Buyer beware: Tuition variation and fees

The tuition comparisons listed above can give students a general sense for how much online degrees cost, but these figures vary significantly from one institution or region to the next, and some programs — even at public institutions — can cost well above the national average. Fortunately, there are a few tools that can help make price-shopping colleges easier. The U.S. Education Department’s College Affordability and Transparency Center ranks U.S. schools by both tuition and total cost of attendance. Though the tool does not allow students to compare online programs specifically, it does give them the option to sort institutions by type, meaning public, private, or for-profit schools at the two-, four-, and graduate levels. Another helpful tool is CollegeMeasures.org, which allows students to research and compare a number of variables across a range of institutions, including cost, first-year retention rates, and overall completion rates.

Tools such as these are helpful when getting a general sense of college costs, but they are no substitute for independent research. Most colleges publish their fee and tuition schedules online; those that do not will typically mail them at students’ request. Remember that tuition is just one part of the overall college cost equation: Health, lab, and technology fees can quickly add up, too, as can book costs. When comparing schools, students should aim to weigh total costs with fees — not tuition rates alone.

The hidden value of online degrees

There are a number of reasons online degree programs are often less expensive than classroom-based programs. For starters, online degrees require no classrooms and desks. No walls means instructors are often able to lecture to far more students, too, which can reduce cost overall. In classes that rely on video lectures, which can be used time and again, savings stretch even further. Another major advantage: Online degrees allow students to shop around without regard for geography. If an institution two states over is more affordable than the college down the road, there is no need to move.

Some of the potential savings of online degrees, however, are indirect and easy to overlook. Students attending online classes do not need to shell out gas money to get to school, and parking and other facility fees are unnecessary. Some schools have begun to experiment with online, open-source textbooks, saving students hundreds of dollars a year. Another advantage of online courses is that they are often nonsynchronous, which means students can view lectures and materials on their own schedules. This allows some students to continue work full-time when they would otherwise have had to reduce or eliminate their work hours altogether. These earnings offset college costs, making higher education more affordable.

More ways to save

One final point to consider when comparing any two degrees (online or otherwise) is that there are programs designed to help students manage their education costs. Financial aid — including subsidized and unsubsidized student loans, grants, and work-study programs — can be a budget-saver for students who need a little help paying for school. Students can usually begin the process by filling out the Free Application for Federal Student Aid online. Scholarships are another way to curb college costs, and may be awarded based on student need, academic or athletic merit, or even for meeting certain social or cultural criteria. In many cases, these scholarships are available to students attending campus-based or online schools. We recommend reviewing the print before applying for any award to discern eligibility.

How much does an online master’s degree cost?

Online education has shaken its experimental roots and moved squarely into the mainstream. According to a recent survey by the Online Learning Consortium (formerly the Sloan Consortium) in partnership with Babson College, about one-third of college students took at least one online course in 2013. At the same time, 90 percent of participating college and university leaders said online education is “critical” to their institutions’ long-term strategy. Many of these institutions are graduate schools. This makes sense, since one of the many benefits of online learning is flexibility — a perk working professionals can appreciate. Still, graduate school — however it is completed — is an investment. How much does an online master’s degree cost? This is a tricky question to answer since graduate school tuition varies not just by region and institution, but discipline and specialty as well. There are a few common trends, however, like the fact that online degrees can be cheaper than traditional programs (especially for out-of-state students), or that online programs offer additional, less obvious savings when compared to classroom-based degrees.

Cost of graduate programs: Online vs. traditional degrees

Online degrees have earned their respectability stripes: Even some of the most prestigious public and private universities now offer graduate degrees online. Part of this growth is driven by growing student demand, but there are plenty of advantages to Web-based learning for the institutions themselves. Online courses require no classrooms, desks, or lab equipment. They save on heating and electrical costs, and — especially when videos and other materials can be reused each semester — instructors’ time. These programs also allow schools to cater to a much wider audience, boosting enrollment overall. Thanks to online education, graduate schools can save money without sacrificing quality. In many cases, those savings are passed on to students.

The following is a brief comparison of the cost of graduate programs, online and traditional, at a small sampling of universities. We have chosen to focus on MBA programs for consistency’s sake. Note that the numbers provided do not cover additional fees or other expenses, like books. Tuition schedules can and do change, so it is always wise to contact specific schools directly for the most up-to-date figures.

Non-tuition fees and other costs

As the chart above illustrates, the cost of graduate programs can vary wildly from one institution to the next, online or otherwise, and in most cases, finding the most affordable option is not as simple as reviewing a tuition schedule. For instance, it is not uncommon for campus-based programs to be slightly less expensive for in-state residents attending public universities, but the same is rarely true for out-of-state students or those attending private colleges. Prospective students should also factor in any additional fees. For campus-based students, these may include student health, facility, and parking fees; online students may be asked to pay information technology fees.

Those mulling over online graduate schools would be wise to take advantage of the fact that in most cases, geography is not a cost factor. That means that if the school down the street costs significantly more than another program across the country, students can attend the more affordable program. This could translate to major savings since the cost of graduate schools vary tremendously, no matter how students attend class. The U.S. Education Department’s College Affordability and Transparency Center ranks U.S. schools by both tuition and total cost of attendance. The tool does not allow students to compare online programs specifically, but offers some baseline for comparing multiple institutions. Remember that online tools, however helpful, are no substitute for independent research. We suggest contacting prospective graduate schools directly for current tuition and fee data.

The hidden savings of online graduate degrees

When researching graduate school costs, it is easy to get hung up on the cost of tuition and other fees, but in the case of online programs, this figure represents only part of the story. That is because there are several often-overlooked savings associated with Web-based learning that can offset or widen tuition disparities. Among them:

• No parking fees
• Gas and transportation savings
• Freedom to skip the college town cost-of-living premium
• Ability to work (often full-time) due to online flexibility

These are just a few of the savings associated with online learning. Keep in mind that some programs are beginning to experiment with other cost-saving measures, like web-based, open source textbooks. As always, students should contact schools directly to get the full picture.

Financial aid and other cost-cutting programs

Graduate school may be a major investment, but students are rarely without help. Many schools — online or off — have financial aid offices that can help students determine if they are eligible for grants, loans, or scholarships, and assist them with the applications process. Graduate students who are able to keep their day jobs can also contact their employer to find out if any special scholarships or cost-saving programs apply, such as tuition assistance or tuition reimbursement for job-related courses. Some organizations, like the National Science Foundation or the American Psychological Association, offer additional grants and scholarships for graduate students conducting qualifying research. Students should always read the fine print to discern eligibility before applying to such programs.

Are online degrees worth it?

While there are no guarantees that any financial investment will result in a good return, a college education, online or even the old-fashioned way, generally leads to a positive rate of return over a person’s lifetime. Students with an associate or bachelor’s degree can simply compare weekly and lifetime earnings with those who only have a high school education to discern the potential financial advantages. Job prospects also generally improve with attainment of postsecondary education.

“The possibilities are endless for students who choose to earn an associate degree versus no degree at all,” says La’Kendra Higgs, registrar for Dallas Colleges Online, the “virtual” campus of the Dallas County Community College District.

The Bureau of Labor Statistics keeps track of wages based on education level and shows that people with a bachelor’s degree have the highest median weekly earnings compared to those with an associate degree or a high school education. As well, they have the lowest unemployment rate compared to people with an associate degree or high school education, a factor to take into consideration given the lay-offs and jobs losses that have occurred in recent years and continue to occur even into 2014.

*Source: Bureau of Labor Statistics

Other data showing an advantage in pay for people who have an associate or bachelor’s degree over that of a high school education comes from the “Education and Synthetic Work-Life Earnings Estimates” report, which is released by the U.S. Census every 10 years. This report breaks down lifetime earnings by race and gender as well as education level. The lifetime earnings in millions for full-time male and female workers are listed below, with the male earnings listed first in each box.

*Source: U.S. Census

How do the lifetime financial benefits compare to the cost of an education? Consider that the average tuition and fees for a public two-year in-state school were $3,265 in 2013-14 and for a public four-year in-state school were $8,893. And often the cost of online education and degrees are similar at public schools and institutions across the country or very close in cost. This is true in the Dallas County Community College District, where no cost differential exists between students pursing an online degree and students pursuing a degree on campus, according to Higgs, and the average cost of a two-year degree for area residents is $5,920. Prices at other institutions can vary and the list below provides a sample of several online undergraduate degrees and various associated costs.

• New England College of Business: Associate of Science degree in Business Administration, tuition and fees: $26,050
• Kaplan University: Bachelor of Science in Nursing, tuition $30,077
• Arizona State University: Bachelor of Arts in Business, Global Leadership, tuition $57,600

With the average college debt at graduation reaching $29,400, investing in a degree that yields a difference in hundreds of thousands over a lifetime may make pursuing an online education or campus-based program very much worth it. Plus, there are many other advantages to online education.

Like with campus-based programming, the credits from many online degrees at two-year schools can be transferred to state or university programs, and they also provide a good way for returning adult students to adapt. “With online programs, students can ease their way back into the educational environment while in the comfort of their own home or office,” Higgs says. “Not to mention, with work and families, commuting to campus can be difficult. I often hear comments that the time and money saved in gas by not having to commute, find sitters, and even change schedules is an incentive to students who really want and need to complete a degree or gain certification.”

Flexibility and new skills in online education

Online education also gives students the opportunity to have a full-time career and keep up with their studying and homework in the evenings, on weekends, or even on a lunch break. This simple ability to keep working may be why some students decide to enroll in an online program or even return to school at all.

Students may also feel more comfortable sharing their thoughts or comments on a discussion board, common to many online education programs, instead of speaking up in a class that is full of classmates or that has a time limitation of 60 or 90 minutes, thereby limiting discussion or follow-up reflection. “Not to mention, students are acquiring additional skill sets through the mastery of educational technologies as they navigate the online classroom and environment,” Higgs adds. “This is undoubtedly very beneficial in the evolving job market.”

Growing approval of online degrees

The credibility of online education has been growing, true for both students interested in advancing their education and college level academia. Schools across the country are expanding their offerings as students sign up to complete an online degree, hybrid program, or even just take a class or two online. At the Dallas County Community College District, with seven community colleges, growth in online programming continues each year, with a significant enrollment increase of 48 percent occurring from 2008 to 2009, according to Higgs. Some of this growth comes from students who want to complete a full degree or certificate online while others take classes as part of a campus-based program, she says. Indeed, the report “Changing Course: Ten Years of Tracking Online Education in the United States,” shows that 6.7 million students had taken at least one online course by 2012.

Academic leaders are also describing online education as more and more viable. The “Changing Course” study shows that as of 2002, only 57.2 percent of academic leaders ranked the learning outcomes of online learning as the same or superior to campus-based learning, but by 2012, that number had increased to 77 percent. Students trying to find an answer to the question ‘Are Online Degrees Worth It?’ will want to take this evidence into consideration and be sure to check on the accreditation of a program when making a decision to enroll. Accreditation is typically granted through a regional accrediting agency, a professional accrediting body, or even the Distance Education Training Council. Many times, graduation from an accredited program is necessary to apply for related certification or licensing or is needed to transfer credits to an upper-level program. Also, it helps ensure that the quality of the program meets specific standards and promotes competency outcomes among enrolled students.

Are online graduate degrees worth it?

While it is difficult to predict the return on any investment, graduate level education is generally worth the financial and time commitment, whether the coursework is completed online or done in an actual classroom. Numerous studies show that people with advanced degrees earn more over their lifetime than those with an undergraduate education. Better career opportunities, a more rewarding career, and increase chances for advancement can be other benefits.

In fact, the median earnings of employees with a master’s, professional, or doctoral degree exceeds those with a bachelor’s degree on a weekly basis. By definition, professional degrees are those that prepare students for a particular profession, and include law degrees as well as credentials such as the Master of Fine Arts, Master of Engineering, and Master of Public Administration. When it comes to careers, people with advanced degrees are less likely to be unemployed, too, another advantage in a market that is just reaching an unemployment rate around a low six percent for the first time in several years. Take a look at the chart below.

*Source: Bureau of Labor Statistics

Other evidence supporting this difference in pay comes from the “Education and Synthetic Work-Life Earnings Estimates” report issued by the U.S. Census every 10 years, which breaks down lifetime earnings on race and gender as well as education level. The lifetime earnings in millions for males and females are listed below, with male earnings listed first.

*Source: U.S. Census

More support for the advantage in pay comes from the Pew Research Center. This Washington, D.C.-based think tank shows that the median monthly income for those ages 25 to 34 with a bachelor’s degrees grew by 13 percent from 1982 to 2009, while those of the same age with master’s degrees saw an increase of 23 percent. During that same period, the median monthly income for those with professional or doctoral degrees grew by an astonishing 34 percent, reaching roughly $5,799 a month. Still not sure that graduate level education can pay? Read on.

Cost savings and other benefits of online programs

At many schools and universities, online degrees cost about the same as campus-based learning, although there may be savings that are accrued in other ways. For example, at Seton Hall University, in South Orange, New Jersey, which has offered both an online and campus-based Master in Healthcare Administration since 1997, there is a slight financial advantage for students enrolled in the online program. “The graduate tuition ($1,099 per credit) is identical for both formats, however the fees are slightly lower for online students,” says Anne Hewitt, PhD, and graduate director of the school’s program.

That said, there are additional ways that students in graduate programs save when choosing online degrees over campus-based coursework. According to Hewitt, calculating these factors can be done by applying what she calls the opportunity costs concept. “If a student selects the on-campus option, that opportunity will cost them in many ways: 1) transportation costs, 2) time away from home and family responsibilities, 3) time away from their job, and 4) additional stress of managing the logistics, such as poor weather, parking, etc.” she adds. “The opportunity costs for online learning is much lower and the student retains the convenience of learning at their time and speed.”

Online learning may come with other advantages as well. As Hewitt points out, online education allows students to continue to work full-time, which can help make school more affordable. Also, students can do their coursework in the evening or on weekends, options that may be precluded by campus-based learning. Learning formats of online instruction can be beneficial, also.

For example, discussion boards, which mimic teacher-to-student and student-to-student dialogue in a physical classroom, and are a component in many online programs, give students the opportunity to access posts and review and reflect upon them later. Hewitt says that in some of her courses, a single topic in a unit can result in 350 or more posts, meaning that more students can contribute than during a limited class time. Another feature of online learning mimicking the classroom is webinars that allow students and faculty to meet synchronously. “Fortunately, even synchronous webinars can now be recorded, for those students who need to go back to review or who happened to miss a particular session,” Hewitt adds.

Growing acceptance of online graduate degrees

The reason that many students at the graduate level are selecting online education is that they have had success with it as an undergraduate. “This is especially true of the returning student to undergraduate and the student who maintains a part-time job to pay for their education,” Hewitt says. “It’s not a new experience for them. The number of students who are entering our MHA online program with prior online coursework has probably increased 50 percent in the last five years.”

Additionally, both students and employers are finding online degrees more credible, and this is occurring at a time when interest in graduate-level education is increasing. In fact, according to “Changing Course: Ten Years of Tracking Online Education in the United States,” 6.7 million students had taken at least one online course by 2012. The acceptance of the online learning format by academic leaders has continued to grow as well. In 2002, just 57.2 percent of academic leaders rated learning outcomes as the same or superior to campus-based learning. By 2012, that number reached 77 percent. Similar growth can be seen at individual schools. For example, the MHA program at Seton Hall University has had a high retention rate and a graduation rate of over 95 percent, according to Hewitt.

Interest in graduate degree programs is also growing, although modestly. Between 2002 and 2012, the number of applications to graduate schools increased at an annual average rate of 4.5 percent, with many of the increases occurring in the health sciences. It’s important to evaluate these programs in advance, and as Hewitt points out, this can be done by looking at a school’s curriculum, faculty, residency options, and technology expertise. Students will also want to ensure that a graduate-level program has received accreditation either through a professional accrediting body, the Council for Higher Education, or the Distance Education Training Council. These bodies have studied the offerings of a school and verified that programs provide the quality and scope of education that they claim.

Is there financial aid or scholarships for online degrees?

Online education can be quite economical. Not only do students save on gas money, parking fees, facility fees, and more, but the flexibility of online degrees also allows many to continue working full-time, offsetting much of their education costs. Still, higher education is an investment, however it is completed, and some students need help managing their costs. Thankfully, most online students are eligible for the same types of financial aid and scholarships available to those who report to a classroom, not to mention other ways to save.

Financial aid for online degrees

Financial aid can be an excellent way to lower education costs. This is true for both online and traditional students — but only if they know how it works (and where to find it). Here is a breakdown of some of the most common forms of financial aid for online degrees:

• Grants. Grants are money that can be applied toward tuition, fees, books, and other eligible education costs. Some grants, like Pell Grants, are funded by the federal government; others, like California’s Cal Grants, are state managed. Students usually apply for these types of grants by filling out the Free Application for Federal Student Aid, or FAFSA (more on this below). Some students can also apply for discipline specific grants, particularly at the graduate level. The National Science Foundation, for instance, grants funds for eligible students pursuing certain types of research. Students should always read the fine print to determine if they are eligible for any type of grant.
• Student loans. Unlike grants, student loans typically must be repaid once students have graduated, but usually at a fair interest rate. Both the government and private lenders offer student loans. Some federal loans are subsidized, which means the government pays students’ interest while they are in school. Subsidized loan eligibility depends on financial need. Many government loans are reserved for certain types of students. For instance, Stafford loans are reserved exclusively for undergraduate students, while PLUS loans are available to both undergraduate and graduate students. Students can apply for government loans by filling out a FAFSA. Private loans tend to vary, both in terms and interest, so it pays for students to do their research before applying.
• Work-study plans. Work-study arrangements allow students to offset some of their education costs by working on campus. For online students attending schools headquartered very far away, work-study arrangements are impractical (if not downright impossible). For students earning online degrees from area colleges and universities, however, work-study arrangements may just work, though reporting to a campus might undermine many of the advantages of online learning.

How to apply for financial aid

For most students, the first step in applying for any kind of federal grant or loan is filling out a FAFSA. The process is relatively painless, and in most cases, students can submit their FAFSA applications online. Students should be prepared to accurately report their earnings and other personal information, such as their social security number. Unmarried students under the age of 23 (and who are not wards of the court) must typically provide this information for their parents, too. Once submitted, the government will determine the type and extent of aid for which students are eligible, then relay this data to students’ schools for processing. It is important to note all deadlines, since students who submit their FAFSAs late often lose aid. Errors can also be costly, to it pays to double- or triple-check applications before submitting them.

Note that some types of financial aid, like private loans or special grants (like NSF grants), have their own application processes. Students can learn more by contacting their schools’ financial aid offices (even with online schools), and by conducting their own research online.

Scholarships for online degrees

Scholarships can also reduce or even eliminate education costs. Unlike grants, scholarships are not typically government-tied, and are not always tied to financial need. The following are just a few common types of scholarships:

• Need-based scholarships . Need-based scholarships are tied to financial need, but earnings thresholds may be more generous than those of grants and other types of need-based aid.
• Merit-based scholarships. Merit-based scholarships award students money based on some type of achievement rather than demonstrated financial need. These can include athletic, artistic, and academic achievements, among others. Some schools and organizations even offer “full ride” scholarships for students who demonstrate exceptional talent, which means they will cover all of a student’s tuition and fees, and, often, most other educational costs.
• Special interest scholarships. Some scholarships are reserved for students who meet a certain profile. They may be dependent on race, religion, or geographical region, for instance. Scholarships for first-generation college students are also popular, as are those reserved for students pursuing a certain type of discipline. Some organizations also offer scholarships for students whose families work in certain industries or for certain companies. Some scholarships are even reserved specifically for online students.

How to find scholarships

Many different types of organizations can offer scholarships for online degrees, including schools, private companies, nonprofit organizations, and more. Because scholarships, and their grantors, are so diverse, there is no simple application process like the FAFSA (though some organizations ask students to submit their FAFSA applications along with their scholarship applications, especially when funds depend on financial need). School financial aid offices are an excellent place to begin one’s search for scholarships, particularly online degree scholarships. There are also several online scholarship search tools, like FastWeb or Scholarships.com.

More ways to save on online degrees

There are a number of ways to reduce costs regardless of a program’s price tag. Grants, loans, and scholarships are among the best-known sources of financial aid, but there are many other, often overlooked programs that can help, too. The following are just a few of them:

• Military education benefits. There are a number of programs designed to help active military service members, veterans, and military family members manage their education costs. Some of the best known programs are the Montgomery GI Bill, the Post 9/11 GI Bill, and Tuition Assistance, but there are plenty of schools and organizations that fund additional grants and scholarships for military service. Service members and veterans can learn more about their options by visiting their Department of Veterans Affairs regional office, or by visiting their schools’ financial aid offices, which can usually counsel students through the process.
• Employer tuition assistance and reimbursement. One of the perks of attending school online is its flexibility — especially if that flexibility allows students to continue to work while completing their educations. This is doubly true for students who work for companies offering education benefits, like tuition assistance or reimbursement. Employer-sponsored programs vary, but often require students to pursue a discipline related to their field of work, and to maintain a certain grade point average. Students should contact their companies’ human resources departments to learn more about potential benefits (and the fine print surrounding them).
• Residency matters. Another key benefit of online degrees is students’ ability to study what they want, from whatever institution they want, without regard for geography. Indeed, many online schools charge students the same tuition regardless of their state residency status — but not all of them. Some schools charge in-state students less, especially in the case of campus-based universities that offer both online and traditional degrees. It can be helpful to keep this in mind when price-shopping potential schools, online or otherwise.
• Tuition variation. Sometimes a school’s type and location can drive costs, regardless of where its students live. Private institutions often charge more than public schools, for instance, but costs can vary tremendously even among public institutions. Tools like the U.S. Department of Education’s College Affordability and Transparency Center, The National Center for Education Statistics’ College Navigator, and CollegeMeasures.org can make price-shopping various schools a snap, though not all of them allow students to compare online degree programs specifically. There really is no substitute for independent research.

Need financial aid help?

Finding and applying for financial aid can be a challenge, but it’s worthwhile. Thankfully there is no shortage of help for those who need it. Most colleges — including online schools — have entire financial aid offices staffed with professionals dedicated to helping students identify different types of aid and discern eligibility, making this an excellent place to get started. Students looking for employer-sponsored programs can consult their human resource representatives, and military service members and veterans can turn to their regional VA offices for assistance.