Two studies considered when the individual mobility strategy of attending university has psychological costs in terms of poor adjustment to university life. Study 1, (N = 74) examined both economic considerations affecting university choice and identity-related factors among open day attendees. Expected identification as a university student and preparedness for university life was affected by economic factors (economic benefit of university attendance and status of the considered universities) but also negatively related to perceived incompatibility with one's social background. These findings were replicated in a longitudinal study in which students' perceptions were assessed before entering university (T1), after being at university for two months (T2) and again after being at university for 8 months (T3; N = 109). Social class (T1) predicted perceived incompatibility but not economic factors. In addition, economic factors and incompatibility predicted group identification (T2) but only perceived incompatibility predicted longer-term identification (T3). Belief that university education serves as a successful individual mobility strategy (T3) was indirectly negatively affected by initial incompatibility (T1), but positively with perceiving economic benefits of a university degree (T1). Implications for the (economic) benefits versus (identity) costs of individual mobility strategies are discussed. Copyright © 2007 John Wiley & Sons, Ltd.