Since the start of the recession in December 2007 approximately five million workers have lost their jobs. Add to that another million or so college graduates facing a bleak employment outlook and suddenly going to graduate school seems like a great defense mechanism. After all, it’s a respectable way to acquire new skills and boost your hiring and salary potential. But, as we know, it’s not cheap. According to the College Board graduate level students assume close to $13,000 a year in federal loans. Law and business school students can easily pile on more than $100,000 in debt.

What if, as an alternative to grad school, you take on a temporary apprenticeship? What if you offer to volunteer at a company or non-profit? Consider it an investment – just like grad school — minus the diploma. Instead, you will get real-life, hands-on experience, connections and skills you can add to your resume. Not to mention – you’re still in the game. You won’t lose touch of your industry and when the job market opens up you’ll be in a competitive position to get hired full-time.

Of course, in some fields – like medicine and law – you need to be accredited in order to find work. The sooner you earn those advanced degrees, the sooner you can start paying down your loans, so skipping out on grad school in these cases may not make as much sense. But we’re not saying don’t ever go to grad school. Even for aspiring doctors, lawyers and MBAs, working an extra year – albeit unpaid – may either boost your chances of getting into a graduate program or, if you end up getting hired, your employer may offer to help pay for your tuition should you decide to go to grad school down the road. It’s worth considering.

We figure you will have lots of questions about how to exactly make “working for free” work – both financially and professionally. Here is some strategic advice.

1. Be Careful Saying “Intern”
At large companies, as soon as you say “internship” to a human resources director you’ll often discover you need to receive school credit in order to participate as an intern. Since that doesn’t apply to you – present yourself as a volunteer, instead. There are strict labor laws that prohibit companies from employing you without pay, but perhaps there are other arrangements the company can make to allow you to work there, at least part-time. The smaller the business, the more flexible the hiring rules may be. Maybe it’s that you agree to work on a commission-only basis (See #2) where you only get paid if you end up adding to the company’s bottom line.

2. Make it Formal
Present your volunteerism to companies you’re interested in joining with a timeline and objective. For example, after getting laid off from a hedge fund recently, a friend of mine offered to “volunteer” his time at another firm saying he would be willing to work for free for six months. In those six months, if he brings in a certain number of clients or a certain amount of revenue, the company agrees to either pay him or hire him, or both. It was a deal. The company has nothing to lose if he fails and a lot to gain if he scores. In exchange, my friend gets the chance and motivation to prove his skills and possibly get a great job at the end of his six-month trial.

3. Get a Part-Time Job
Paying your bills and expenses while working for free will require some multi-tasking. It won’t be easy, but then again grad school will also keep you up at all hours. Unless you have enough in your emergency savings account to get you through this time, you will need to find part-time work. The good news is you can create your own schedule with many part-time jobs – like direct sales, freelance writing, dog walking, catering – many of you can do from your home and during evenings and weekends.

4. Diminish Housing Costs
Your housing costs tend to eat up the biggest portion of your income. Some tips to lower your expenses – barter for a place to stay by temporarily moving in with family or friends for free in exchange to clean and cook. Or, get a roommate and split the rent. It’s good to keep in mind that it will just be temporary and that it will all pay off in good time.

5. Continue Looking for Full-Time Work
As the saying goes, “the best time to find a job is when you have a job.” Being in the workforce keeps you in the game, so to speak, and may make you more desirable to competitive employers. Attend career workshops and fairs and continue to network on and off-line to find a full-time job, if that is your ambition. And once you’re full-time, you may be able to bank on the company’s tuition reimbursement plan and finally go to grad school for a lot less.