THE BLOG
07/17/2013 01:10 pm ET Updated Sep 16, 2013

Paid Job vs. Unpaid Internship: Make the Best Choice for You

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When I was a college student studying art history, I landed a summer internship at a local "living history" museum where I gave tours of historical farms in period costume. I received college credit and a small stipend, but it was the experience I gained that made the position so memorable. Not only did I learn how to lead diverse groups of people, I figured out how to keep them interested and engaged for over an hour in the sweltering Midwestern heat! While I couldn't have taken the position without the stipend, I had plenty of friends who held unpaid internships to get hands-on experience in the fields they wanted to pursue.

As you weigh your options for this fall and beyond, what's the best choice: a plum internship or a job that pays the bills? The short answer: It depends. If you're having a tough time deciding between an unpaid internship in your ideal field and a job with a paycheck, here are a few things you should ask yourself to help evaluate your decision:

What is your financial situation? As was my case, not every student can entertain the idea of an unpaid internship. If you're short on cash for tuition, books or rent -- or if you've borrowed a significant amount in student loans -- it's important to use available time during summer or breaks from school to earn money. If an unpaid internship is available but takes away from a paying job that will help towards financial obligations, carefully weigh the short and long-term impacts. Prospective employers' value relevant industry experience, but they are also impressed by young people who are hardworking and responsible with their finances.

What's the value of a particular position? Carefully consider your ultimate goals before accepting a position, paid or unpaid. A paid internship may be your goal but if jobs are few and far between in the industry you want to enter or if you're looking for a job at a specific company, an unpaid internship may be one of the best ways to network into the business. There are also many other intangible benefits of an unpaid internship that may make up for the lack of a paycheck. On the other hand, a paid position can offer valuable hands-on experience with the bonus of a paycheck. For example, if you're studying in a field like business marketing or technology, you may be able to find a part-time position in sales or at an IT desk that offers similar experience as an internship. Note that it may be helpful to speak with an academic advisor or mentor to evaluate your internship choices. If you're responsible and determined, it may be possible to balance time between a paid job and an unpaid internship you're passionate about pursuing.

How is the position viewed within the organization? In a paid position, you might have a slight advantage, since paid positions may be part of a more structured program. A paid position may also garner more attention by peers and leaders as a result of an employer investing financial resources for your contributions. But, it's not always about the money. By committing to your internship or job and impressing your leaders with hard work and good results, the reputation you build will be equally strong. It's also important to note that under the Fair Labor Standards Act, unpaid interns can't be used to replace traditional paid workers, or to generate profits. The Department of Labor's Wage and Hour Division has criteria to determine whether or not an internship program meets the exclusion from paying interns

Some colleges and universities offer internships for academic credit. If you're paying thousands of dollars to take a three-credit class and can also receive three credits for an unpaid internship, this changes the financial equation. You can count earning credits through an internship as a financial tradeoff, even if you're not necessarily earning formal income, since you're not paying to be an intern or to earn the credits.

If you're getting your resume and applications ready for fall internships, remember to take a close look at your current finances and your future career goals. It's important to base your decision on whether or not a position is a good fit with your future interests, as well as with your financial situation. Ultimately, the best role is one that helps you gain useful, hands-on experience while staying true to your financial goals.