PhD funding: A Complete Guide

All of the Information about PhD funding is on the internet but its scattered over different university pages. Each program usually describes only its own policies, and almost none of it explains the general system of PhD funding that broadly applies in the US. In this guide I‘ll try to describe that system of funding, what an offer letter usually contains, what to ask before you accept an offer, and where more money comes from (outside of the school/program you are accepted to).

Just as a note, I am a physics PhD student in the United States. The sections on humanities funding, international students, and negotiating rely on published sources and what I have learned from other people (not from my own personal experience). I have tried my best to be accurate but corrections are always welcome!

How PhD funding actually works

Probably the most important fact about PhD funding is that, in most scientific and technical fields in the United States, you do not pay for a PhD. You are paid to do one. When you get an offer letter, your tuition is covered and you will be paid a stipend to live on. If you are being asked to pay tuition out of pocket for a science or engineering PhD, that is not normal.

The reason you are paid as a PhD student is because you will work during your PhD (more on this so keep reading). Departments need people to teach recitations and grade problem sets; principal investigators (PI’s) need people to run experiments, write code, etc. Your stipend is compensation for the work that you do.

When someone says that a PhD is “fully funded” this usually covers four different things:

• Stipend: money you are paid directly and is typically deposited in your bank account
• Tuition remission: the university waiving or paying for your tuition
• Fee coverage: separate from tuition and it depends on the program
• Health insurance: sometimes free, sometimes subsidized, sometimes your responsibility

Where the money comes from determines how stable your PhD will be. There are four sources of funding:

• Departmental funds
• Your advisor’s research grant(s)
• A university-wide fellowship
• An external funding organization

Grant-funded support is the most common funding arrangement in science PhD’s and also the most contingent. If the grant ends, the position ends (don‘t be scared though, its just something to know). Departmental support can be steadier and often comes with the responsibility of teaching (not a bad thing especially if you love teaching). External fellowships are the most secure because the money you receive is completely yours.

Your Field of study actually matters more than anything else. In science and engineering, funding is the norm and an unfunded offer is rare (I’ve never heard of an unfunded offer). In the humanities, funding is more variable. Professional degrees are often unfunded (MBA, non-thesis masters, etc).

The country where you do your PhD also matters, and most American resources ignore this one (that I know of). Across much of Europe, a PhD is structured as employment: a salary, pension contributions, holiday entitlement, and employment protections. The American model where you have student status with a stipend is specific, so if you’re looking outside of the US make sure you do some more research.

The funding types

There are six common funding types:

Teaching assistantship/teaching fellowship (TA/TF). You teach. This can include recitations, labs, grading, office hours, etc., in exchange for a stipend and tuition remission. Usually you work around twenty hours a week and departments have a maximum you are allowed to work per week. You are employed and paid by the department not an advisor’s grant. For example, maybe you are paid by the physics department to TA for an intro undergraduate physics class. Most first-year students pursuing a science PhD start with a TA assignment.

Research assistantship (RA). You are paid from your advisor’s grant to do research, often the research that becomes your dissertation but in some programs you rotate through research labs your first year.

Graduate assistantship. This is usually where you do administrative or programmatic work, generally unrelated to your research. Less common for science PhD’s.

Internal fellowship. Money from the university or department with no service obligation. Recruitment fellowships are offered to attract you and dissertation-completion fellowships exist to help you finish.

External fellowship. This is money from an outside funding organization such as a federal agency or a private foundation. These are often portable meaning that they go with you regardless of what school you are at and they carry with you if you transfer. They are often competitive and prestigious.

Traineeship. Federal training grants fund cohorts of students working in a specific/designated area. These typically include stipend, tuition, and structured training, and there are often constraints on research area or citizenship.

Federal laboratory appointment. Some universities hold agreements that place graduate students inside national laboratories while they stay enrolled at the school and earn their degree from the university. These typically cover tuition and fees, pay a stipend, and function as a full replacement for any other assistantship rather than a supplement for one. These are often advertised as job postings rather than through admissions, which is why most students never learn they exist. If your institution is near a federal lab, ask your department! These are worth looking into!

Two notes on funding types

First there is a distinction between compensatory and non-compensatory support. Basically, if you perform services to receive the money, it is compensation: you will get a W-2 and have taxes withheld from your paycheck. If there is no work requirement for you, it is an award, and it may arrive with no tax withholding at all!

The second thing is that most students move between funding types and this completely normal. A TA assignment in your first year is typical, then a research assistantship once you join a group (can be in the first year), and a fellowship if you win one. Appointments usually run on a semester basis, so that transitions happen between terms rather than mid-semester.

Reading your offer letter

A complete offer letter should generally tell you the stipend amount you will receive, whether that stipend covers nine months or twelve, the appointment percentage, how many years of support are guaranteed, how much tuition is remitted and for how many credit hours, which fees are covered, whether health insurance is included or subsidized, and whether you will be funded over the summer. If your offer letter does not include these items, you can contact the appropriate admin in the department you applied to.

Appointment percentage is something important so let’s break it down. A fifty percent appointment conventionally means twenty hours a week, and it frequently functions as an eligibility threshold for health insurance subsidies, dental coverage, and other benefits. Basically, your appointment percentage should be high enough so that you are eligible for all of the benefits.

Here are some things you can ask when you are accepted to a program:

• If my advisor loses funding, what happens to me?
• Can I change advisors and keep my funding?

Some departments (such as mine) will support PhD candidates for their first two years if you TA. After your first two years you need to have found an RA position.

Money ratios matter

The ratio matters more than the number. A stipend of $50,000 in Boston and $36,000 in a small college town are not comparable offers. The number you should calculate is the cost of your rent as a fraction of the stipend you receive: a third is comfortable, 50% is common and hard, and above 50% is difficult without savings or a second income. Current students in the program are a great source for local rent prices, and they will usually tell you.

Taxes also matter. Assistantship pay is compensation. You will get a W-2 and have federal taxes withheld. Fellowship pay frequently has no withholding at all. The money arrives whole, you owe tax on it regardless, and you may be expected to make quarterly estimated payments. It might be reported on a 1098-T, a 1099-MISC, a 1099-NEC, a courtesy letter, or nothing at all. Tuition remission is generally not taxable for degree candidates but the stipend is.

This guide does not give tax advice and I am not an expert. Personal Finance for PhDs is a good resource and is updated every year. It is better than anything I could write here so take a look at that. Also talk with your departments admin, they are often incredibly helpful and can direct you to the right places.

Fees are not included in full funding. Student fees, activity fees, technology fees, etc., are frequently not covered by tuition remission.

Health insurance is usually a university plan with a subsidy connected to your appointment. The subsidy often exists only if you enroll, which means waiving in favor of outside coverage can be more expensive.

State residency is the requirement nobody warns you about. Even when your tuition is covered, universities often require domestic students to establish in-state residency before their second year, because resident tuition is cheaper for the institution to remit. This generally means you have to live in the state your university is located for 12 months and apply for in-state residency before the start of your second year. This is important so definitely check with your university.

Unionization. Unions are increasingly common among graduate workers so you should find out whether your program has some kind of a contract.

External fellowships

External fellowships are honestly worth a lot more than the money attached to them.

A fellowship makes you inexpensive to advise. You’re pretty much free for the university and for any research lab. A PI who does not have to pay for you can take you on regardless of whether or not they have grants, which makes you more attractive to labs. External fellowships that fund your PhD give you independence, allowing you to change advisors/labs and they are also credential that follow you in your career.

The largest fellowship awards are generally open for you to apply around your transition into graduate school and your first year and several of them are once-only, which makes your first year pretty consequential. Dissertation-completion funding matters most in the humanities and social sciences.

Eligibility is very important so make sure you understand where you stand. Many federal fellowships require US citizenship or permanent residency. Several restrict how far into a program you may be. For example, the NSF Graduate Research Fellowship (GFRP), in recent years, permits enrolled graduate students to apply only once, during their first year. These rules change, so make sure you check the year you apply rather than relying on an old blog post.

Special situations

International students. Most large federal fellowships are closed to you, visa status constrains outside employment, and tax treatment depends on treaties between your country and the United States. Institutional funding, university fellowships, and home-country scholarship programs usually carry more weight.

Humanities and social sciences. Funding is generally scarcer, guarantees are shorter, teaching loads are heavier, and summer support is less likely. External funding organizations play a pretty large role.

Master’s degrees. Generally far less funded than doctoral study. Terminal master’s programs are frequently a revenue source for universities. Funded positions exist, but they are competitive and usually attached to assistantships.

Students with dependents. Ask about family health coverage, childcare subsidies, family housing, and parental leave. These policies vary enormously between institutions and are often unpublished, which means asking directly is the only way to find out.

When funding falls through. Advisors lose grants, relationships end, projects fail. Learn before it happens whether the department has bridge funding, whether you can pick up teaching on short notice, and whether changing advisors means changing your funding source.

Negotiating. More possible than most applicants assume and more constrained than in industry. Stipends are frequently fixed by policy; what tends to be negotiable is a summer guarantee, a fellowship top-up, a relocation allowance, or equipment support. A competing offer is the strongest lever you will have. Ask once, politely, in writing.

Resources

• Personal Finance for PhDs: the specialist resource on graduate student taxes and money
• ProFellow and your university’s fellowship office: fellowship databases and internal competitions
• Your professional society: most maintain field-specific award listings
• Your graduate school’s funding office: the authority on your own institution’s mechanics
• Current students in the program you are considering: the single most useful source on this list, and the most underused

This guide is updated as I learn more. If something here is wrong or out of date, I would like to know.