Prestige Usually Requires Hefty Investment

There are no overtly “cheap” MBA programs, but the costs do vary depending on the institution. For example, one of the best-regarded programs, Harvard Business School, costs an estimated $56,175 just for tuition, and this number doesn’t include costs like a student health fee that approaches $1,000, a student health plan that costs more than $2,000 and room & board costs. Harvard estimates that a single student with no dependents will need over $90,000 a year for costs and tuition while attending this lauded business school.

On the other hand, attending college at the Lamar University College of Business in Texas may cost a student just over $21,000 in tuition each year, which is a compelling reason to consider this Beaumont, Texas school instead of Cambridge, Massachusetts’s Harvard University. The entire cost of tuition, fees, and living expenses at Lamar is less than the tuition alone at Harvard.

Expected Income and School Choice

A student must consider whether basing applications on the cost of tuition will net the best return on investment with the available income after graduation. The prestige that the holder of a Harvard MBA possesses often leads to bidding wars for graduates. Based upon previous graduates, Harvard suggests that graduates of the class of 2012 had a median base salary of $120,000 and enjoyed a median signing bonus of $20,000. Graduates of other business schools don’t always enjoy this level of income immediately upon graduation.

Expected Occupational Outlook

An additional factor to consider when selecting an MBA program is the overall state of the economy, and the job growth expected in a student’s chosen industry. For example, the Bureau of Labor Statistics (BLS) suggests that executive-level workers earn a median pay of over $100,000 a year, which is a healthy salary. Unfortunately, expected growth for new jobs in the next decade is only around 5%, which is dramatically slower when compared to employment in all industries.

Making Smart Education Choices

One alternative that future MBA students should consider is the opportunity to attend college while working for a company. Several major companies around the country will pay for some or all of the tuition associated with attending business school. The only requirement from the student is satisfactory grades. The caveat to this strategy is that working at a company while also attending an MBA program represents an incredibly full schedule, which may be difficult for applicants who have families.

Whether an MBA will result in a positive return on investment for a student often depends upon the dedication and actions of the student while in an MBA program and after school. Determining whether the cost of a program is worth the cost of tuition, requires figuring out the expected income of graduates from that program, as well as the overall cost incurred while in the program.