This is something I thought about a lot. I'm currently a grad student at a great school and even though I sometimes get frustrated with classes, I've never regretted it. There is a lot more to grad school than just taking classes and doing research.

For me, the main attraction and benefit of being in grad school was being immersed in an environment filled with smart people wanting to "do more". My school's heavy emphasis on entrepreneurship has also energized me about creating a startup. The caveat is that one must find a way to attend grad school for free (which actually isn't hard at all).

Why?

why not?

Because its more work than getting a master's and also much higher risk.

Well, perhaps because some might be more interested in say digging in Egypt to undercover archaeological sites, or maybe they interested in being a doctor, or perhaps a lawyer, or maybe they would rather do research on how they can make machines think, or a million of other things which have not much to do with starting your own business, to start with anyway.

So will you now tell me why they should start a business instead?

Because it will take you years and years of effort just to get the advanced degree that will enable you to try many of these lines of work, [1] at which point you may discover that you don't especially like them.

I can tell you about this experience at great length if you really want. ;)

(Dabbling in medicine or law is particularly expensive, because... it's expensive. You have to go into massive debt, on top of your potentially massive college debt, before you figure out that medicine or law can be a really miserable line of work. At least I didn't do that -- my years of career trial-and-error were cash-flow positive, though I didn't exactly live like a prince on my grad-student and postdoc salaries...)

Meanwhile, you don't have to do years and years of academic hoop-jumping before learning whether or not you'd enjoy starting a business, or working at a startup. (Or working at a big company, for that matter.) You can learn a lot just by trying it. You don't even have to wait for graduation.

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[1] Beware: You may think that you can learn whether you'd enjoy (e.g.) archaeology by volunteering to help on a dig, or by being a grad student in archaeology. And that is a good idea. But enjoying life as a grad student or intern is not the same as enjoying a career in a given field. In many fields, professors spend most of their time raising money, managing people, playing political games, and writing papers and proposals, not digging holes, performing calculations, or building neat stuff in the lab.

Remember, though, that if you enjoy life as a graduate student, there's nothing forcing you to become a tenure track professor and deal with all the management/politics.

And if you enjoy being a grad student, then there's little disincentive (other than opportunity cost) not to do that, learn a lot, and come out with a PhD that will make it easier and better paid to find similar work out there.

(n.b. I am assuming that one is getting a PhD in the sciences, or any field where there is reasonable amounts of funding available and one need not take loans to continue being a student.)

That's why I want to be financially independent, diff than a startup, tho.

Doing a startup might get me financial independence, but only at the expense of possibly years and years of grinding effort, given the normal stats.

However, if my standard of living is low enough, and I pick my location well, I should be able to become financially independent in not too many years at a normal job.

Additionally, if you put a few years into the military, you could even get a free grad degree.

I think you're leaving out a very important aspect of graduate school, which is simply the ability to experiment and find out what you truly love to do. You can be pigeonholed into a business you don't particularly like, just like you can with a graduate project. But I feel like graduate school offers you much more flexibility and time to figure your shit out, at which point by the end you atleast have a solid credential to back up your work ethic.

I am a new grad student after spending a few years in industry. My advice for people who don't know what they want to do is to go straight to work. Don't go to grad school. It is much nicer to figure out what you want to do while earning $60k+ than $18k.

I don't feel like money is the issue though. When you're working for a company your job is to produce something for them--something that moves the company forward. In grad school, your work is much more selfish. You have ample time to think about problems in ways that only you can solve.