That cost also assumes you'll budget for a "moderate student lifestyle", which will be difficult to stick to when you're pressured to attend expensive dinners, weekend getaways, conferences, and other trips with fellow students and friends.
With prices like this, you have to question if it is the best investment available to you. How much does an MBA truly cost you, and is it worth it?
Let's dive into answering that question.
Besides the upfront and out-of-pocket costs, you should consider that you are removing yourself from the workforce and losing two years of income. If you were making $100,000 a year before business school, then you are foregoing $200,000.
If you were making at least $100,000 a year before, the average post-MBA salary of $126,919 does not seem to justify the investment. Not monetarily, anyway.
If you're going to invest your time, money and effort, there has to be a clear understanding of the benefits and opportunities. Once you've considered the price tag, you need to ask: Why are you spending thousands of dollars on an MBA?
I asked my cousin and his MBA classmates this question, and the three most common responses were that it:
- Helps to create a strong network for future business success.
- Is a lot of fun to travel and party with interesting people my age.
- Makes me more desirable to be hired and increases pay.
Personally, I think that spending two years and $200,000 to meet people and build a network is insane. You could spend that money to go to every conference in the country for a year, and meet more interesting individuals with higher status, more connections and business acumen. A TEDx ticket, for example, is $10,000 (and $25,000 for patrons).
How else could you spend $200,000 to get a valuable professional and personal return on investment? Here are a few ideas:
- Fund an early stage company.
- Travel around the world to experience different cultures for at least a year.
- Pursue a creative passion in a city of interest for two to three years.
- Meet entertainment executives and professionals at events like Sundance and the Toronto International Film Festival.
- Go to seminars and learn from top business gurus.
- Hire a PR firm to revamp your image.
You don't have to spend a fortune to build a network and meet interesting people. The key is to know your options. They are not just: Go get a job or go get an MBA. Your options are infinite--you may just not know what's available to you.
A few years ago, I invested in brunchwork--a community that runs workshops and events with companies like Snapchat, Foursquare, and Rent the Runway--for this exact reason. Paulina, the founder, had a goal to support people between the ages of 23 and 35 who want to improve their networks and learn without getting MBAs. It's one alternate option--of many--for those interested in learning from and connecting with successful people.
Another option is to connect with one of your heroes and volunteer to work for them. If you volunteered to be the assistant of a high-profile CEO and got paid nothing, you'd still be $200,000 ahead. You'd stand out, be able to learn directly with top business people, and gain hands-on training and access to their network.
There's no doubt that an Ivy League education and the right pedigree can influence your job prospects. If you have a Harvard MBA, people are likely to notice and take you seriously.
It's not the only thing that can make employers take notice of you, though. A variety of experiences can make you more interesting.
No matter what you do, you have to invest in yourself--which means you have to understand the risks and costs. If you had $10,000 for your education, what would create the biggest impact on your knowledge, experience, and community?
In other words, if you choose to get an MBA, do it for the right reasons--and get the greatest return on your investment.