15 cities where getting a graduate degree pays off the most

• Graduate programs may pay off the most in cities in California, Alabama, and Utah.
• The San Jose area has the largest pay gap between holders of a graduate degree versus a bachelor's.

Many graduate programs cost a fortune, and they may pay off the most in cities in California, Alabama, and Utah.

A new analysis from SmartAsset found the San Jose-Sunnyvale-Santa Clara metro area in California; Huntsville, Alabama; and the Trenton-Princeton area of New Jersey had the greatest difference between pay for people with a bachelor's degree versus a graduate degree. The study analyzed US Census Bureau data from 281 metro areas with populations above 100,000 residents.

Data from the Education Data Initiative shows a graduate degree on average costs between $54,000 and $73,000, depending on factors such as the school and area of study. Between the 1989-90 academic year and the 2020-21 one, graduate-school tuition increased nearly 5% a year. Some top law schools cost over $200,000 over the course of the program, while medical schools average nearly $219,000 a year.

The San Jose-Sunnyvale-Santa Clara metropolitan area had an average income difference of over $48,000 between a graduate and bachelor's degree — $150,000 versus $102,000, according to SmartAsset. San Jose graduate-degree holders made about $30,000 more than in San Francisco, which had the next-biggest gap.

Huntsville had an average difference of slightly over $36,000, with graduate-degree holders earning nearly $100,000. Nearly 18% of adults in Huntsville have a graduate or professional degree. In a US News ranking of the best metro areas to live in, Huntsville placed second, with residential construction booming over the past few years.

The Trenton-Princeton area, where graduate-degree holders made nearly $103,000 a year on average, had an average income difference of about $35,600, ranking third.

Cities in Utah and California rounded out the top 10 for income difference, suggesting many positions pay more or hire more frequently for those with Ph.D.s or master's degrees. St. George, Utah, near Zion National Park, ranked fourth, while the Provo-Orem area of Utah ranked seventh. California cities with an income difference above $28,000 included Merced, the San Francisco metro area, and Fresno.

Nationally, Americans with graduate and professional degrees earn a net $484,000 more on average over the course of their careers compared with holders of bachelor's degrees, SmartAsset found. That averages to about $16,000 a year assuming a 30-year career. SmartAsset found the average graduate degree holder made $72,000 a year.

However, the trend of graduate-degree holders making more than recipients of bachelor's degrees doesn't apply everywhere — Tuscaloosa, Alabama, and the Elizabethtown-Fort Knox metro area in Kentucky actually had an average of nearly $3,000 more in earnings per year for bachelor's degree holders. For cities including The Villages, Florida; Prescott, Arizona; and Morristown, Tennessee, graduate-degree holders made less than $55,000.

This data comes after a SmartAsset study from earlier this month found wealthy Americans ages 26 to 35 were moving at the highest rates to Florida, Texas, and New Jersey. Florida has two metropolitan areas in the top 15 for graduate-degree income difference, though neither Texas nor New Jersey ranks in the top 25.