Graduate school is an investment, and a substantial one. Whether you are pursuing a master’s degree, a doctorate, or a professional program, the cost structure is often different from undergraduate education: tuition is typically higher, and the financial aid landscape changes. Here is a comprehensive look at your funding options for the 2026-27 academic year.
Federal Direct Unsubsidized Loans
Graduate students can borrow up to $20,500 per year in federal Direct Unsubsidized Loans. For the 2026-27 academic year, the interest rate on these loans is 8.07%. Key facts:
- No credit check required
- Interest accrues from the date of disbursement (no subsidized option for graduate students)
- Origination fee of 1.057% is deducted from each disbursement
- Flexible repayment options including income-driven plans
- Aggregate limits:
- Master’s and Academic Doctoral Programs: $100,000 (with an annual limit of $20,500).
- Professional Practice Programs (e.g., Medicine, Law, Dentistry): $200,000 (with an annual limit of $50,000).
For many graduate students, $20,500 per year does not cover full costs, which is why additional funding sources become essential.
Federal Direct PLUS Loans
Note: a “Direct PLUS Loan” is commonly referred to as a “Grad PLUS loan” when made to a graduate or professional student.
Direct PLUS loans for graduate borrowers are no longer available. However, if you are a graduate or professional student, you may be eligible to borrow a Direct PLUS Loan under the limited exception for your expected time to credential only if you:
- were enrolled in a program of study at a school as of June 30, 2026;
- borrowed a Direct Loan for that program of study prior to July 1, 2026;
- are currently enrolled at the same school in the same program of study; and
- haven’t had any break in your enrollment in the same program and the same school at any time as of July 1, 2026. [An approved leave of absence isn’t considered a break in your enrollment.]
Graduate and professional students who don’t (or no longer) qualify for this limited exception are not eligible to borrow Direct PLUS Loans. A graduate student is defined as a student enrolled in a program of study that is above the baccalaureate level and awards a graduate credential (other than a professional degree) upon completion of the program. A professional student is defined as a student enrolled in a program of study that awards a professional degree upon completion of the program. A professional student may not receive Title IV aid as an undergraduate student for the same period of enrollment.
Private Graduate Student Loans
Private lenders, including credit unions, offer graduate student loans that can fill the gap between federal aid and total costs. When evaluating private options:
- Compare the Annual Percentage Rate (APR): APR captures both the interest rate and fees, giving you a clearer picture of total cost
- Check origination fees: Many private lenders charge no origination fees, which means the full approved amount is disbursed to your school
- Understand repayment options: Some private loans offer in-school deferment, interest-only payments, or immediate repayment
- Consider fixed vs. variable rates: Fixed rates offer predictability; variable rates tied to an index such as the prime rate can change periodically1
Visit our marketplace to compare graduate student loan options from credit unions. For a deeper comparison, see our guide on federal vs. private graduate student loans.
Assistantships and Fellowships
Many graduate programs offer funding through assistantships that combine tuition benefits with a stipend:
- Teaching Assistantships (TAs): You teach or assist with undergraduate courses in exchange for tuition reduction and a stipend.
- Research Assistantships (RAs): You work on faculty research projects, often funded by external grants.
- Graduate Assistantships (GAs): Administrative or departmental work that comes with similar financial benefits
- Fellowships: Merit-based awards that may cover tuition and provide a living stipend without a work requirement
These positions are competitive but can substantially reduce your out-of-pocket costs. Apply early and check with your department about availability.
Employer Tuition Assistance
If you are working while pursuing your degree, your employer may offer tuition assistance. Under current tax law, employers can provide up to $5,250 per year in tax-free education assistance. Some companies offer more through their own programs, though amounts above $5,250 may be treated as taxable income.
Check with your HR department about:
- Tuition reimbursement or prepayment programs
- Whether your degree program qualifies under the company’s policy
- Any service commitment required after receiving assistance (some employers require you to stay for a set period after graduation)
Read more about employer student loan assistance programs.
Grants and Scholarships for Graduate Students
Graduate-level grants and scholarships exist but require more active searching than undergraduate awards:
- Professional associations: Many field-specific organizations offer scholarships for graduate students
- Institutional awards: Your school’s graduate office may have department-level awards or tuition discounts
- Federal grants: While Pell Grants are for undergraduates, certain federal programs (like TEACH Grants) are available to graduate students in qualifying programs
- State grants: Some states offer graduate-level financial aid programs
Building Your Funding Stack
Most graduate students fund their education through a combination of sources. A practical approach:
- Start with free money: Maximize scholarships, fellowships, assistantships, and employer aid.
- Use federal loans next: Federal Direct Unsubsidized Loans offer borrower protections and flexible repayment
- Borrow only what you need: Even if you are approved for more, keep your total borrowing aligned with your expected post-graduation income.
For a comprehensive look at graduate funding, see navigating new loan limits for grad and professional degrees.
1Variable rates are subject to increase after consummation. Rates vary by credit union and depend on credit union membership eligibility.
