Once you have decided on an area of psychology the next step is to decide whether to pursue a doctorate or masters degree. In general, it is my opinion that it is better to pursue a doctorate. Most (but not all) research jobs will require the PhD, and the better professional psychology careers will go to those with a doctoral degree. Some of my colleagues disagree with me and see a masters degree as a good option. This is because they see a lack of significant difference in job opportunities between masters and PhD holders. This is especially true for jobs that provide direct counseling or social work services. It does seem likely that most jobs that directly provide counseling or social work services will not require a doctorate in the future. In my opinion, however, these jobs are likely to be low paying and without much opportunity for career advancement.
There are, of course, some instances when getting a masters degree makes sense. The first and most common scenario is when you want to pursue a doctorate in some area of psychology, but you will be hindered from getting into a graduate program because your grade point average and/or GRE scores are too low. In this case it makes sense to go to a masters program that can better prepare you to enter a doctoral program. You will have a chance to bring up your grades and hopefully study harder for the GREs. The risk with this strategy is that even after getting a masters degree you still might not get into a doctoral program in your chosen area. It is important, therefore, if you choose this strategy to make sure the masters program you are entering has a good track record of getting its graduates into doctoral programs.
A common question is what grade point average (gpa) and GRE scores are needed to successfully apply for a doctoral program. Unfortunately there is no set answer to this question. It depends on the specialty area sought, the status of school you want to get into, the status of your undergraduate program, and (perhaps the most intangible thing) how interesting you are as a person to a specific program. It is possible, however, to make some sweeping generalizations about the probability of getting into a doctoral program based on gpa and GRE scores. These are a bit different depending on whether or not you are seeking entrance to a university or a professional school based doctoral program.
University-based doctoral programs will provide you with some kind of support for your doctoral study. This support can range from student loans all the way to a full ride scholarship that also covers living expenses (Since university systems have been suffering financially over the past few years the level of support for doctoral students has decreased and students have had to rely more of loans than in the past.). As might be expected, university doctoral programs are typically harder to get in to than professional school doctoral programs.
Universities tend to want to train researchers, even in areas of professional psychology such as Clinical Psychology. They take far fewer students per year and, as mentioned, usually offer some sort of support for their doctoral students. This results in a lot of competition for a small number of positions in doctoral programs. Again, this is different among the different psychological specialties. For instance a PhD in Social Psychology make accept 10 students out of 100 applicants, while a PhD in Clinical Psychology may take 5 out of 700 (the university-based clinical programs are now harder to get into than medical school even though they seek to primarily produce clinical researchers).