Should I Get an MBA?
The short and general answer to the question “Should I get an MBA?” is no. The costs rarely outweigh the benefits. There are specific instances when you should pursue an MBA. However, the situations are actually very limited and it may end up setting you back instead of propelling you forward.
Below are the factors you need to consider when deciding whether to get an MBA or not. Remember that it’s a 2-year vacation if you are pursuing it in person. Not only does it cost money to get an MBA, there are huge opportunity costs as well.
Before we get into the factors you should consider before getting an MBA, let’s SMASH that social share button and post to your favorite social media for your friends to be more educated! Your friends might be on the fence of whether to get an MBA or not and this article is helpful in coming up with the right decision.
If this article saves one of your friends money, time, and agony, why wouldn’t you? It’s free to do and it only takes 5 seconds to do so!
So with that said, let’s get into the factors to consider.
1) MBA Goals
Find out what your end goal of getting an MBA truthfully is. Most people pursue an MBA because they’re miserable at their jobs. Therefore, they pursue it because they want to “rebrand themselves” and go to another industry. Or it could be that they want to build their network even further.
After all, if you’re spending six figures and many hours a week collaborating with others, you will form bonds that can’t easily be broken. One of the Stanford alumni I spoke with said, “I needed to stay in Australia for 3 days because I needed to speak to a supplier there. I reached out to my network and within hours, someone welcomed me into their home for 3 days”.
The network you build from getting an higher education is huge. There are an infinite number of reasons why people register for it. Matter of factly figure out and find out what your goals and reasons for it are. Then consider whether if it’s a valid or a bad reason to pursue it.
2) Career Goals
If you’re considering whether you should get an MBA or not, there’s a good chance you are most concerned with your career prospects. What are your career goals? Is it to start a business? To accelerate your career path? Is it that the next level up the ladder requires an MBA?
After you consider your overall and general goals of pursuing an MBA, consider what your actual career goals are. Then find out whether they are valid. A Masters in Business Administration is not to educate yourself further on how business works. The bigger reason is to propel your career forward.
3) The Cost and Opportunity Cost
The final factor to consider is the cost of getting an MBA. Who’s paying for it? Did you get a scholarship? Are you a veteran and the government is footing the bill? Is your company paying for you to get a higher education? Some companies absolutely will not pay for it.
In which case, you have to recognize what you’re missing out on. You’re not just paying for it in terms of money but in terms of opportunity cost as well. If it’s an in-person program, then you not only have to pay six figures in tuition, classroom materials, etc. You also have to pay the lost earnings.
A 2-year program can cost upwards of $100,000. If your salary was $70,000, you not only spent $100,000 but another $140,000 in lost wages as well, a total cost of $240k. All for a chance to earn the average graduate salary of $115,000? That’s why it’s all the more important to get someone else to pay the bill.
Maybe after working 2 years, you get a raise to $80,000. That extra $35,000 in salary after getting an MBA to pay off the $240,000 you gave up takes 7+ years to break even. Seven years is an eternity. Imagine investing your money in the stock market only to break even seven years later.
You would be beyond frustrated and think how you might as well never invested in the first place.
Why Should You Get an MBA? The Right Reasons
When you’re asking “should I get an MBA?” there are right reasons for trying for an MBA. A similar question is “what do you want to get out of it?” and there are right reasons to get it. I am not saying you should never go for it, I am saying there are specific instances where it’s a sensible reason.
1) You Want to Accelerate Your Career Path
Some companies require an MBA to advance. If you are in love with the company culture, the people, management, business, operations, and vision of the company and you don’t want to leave, then this is a good reason. Companies that require employees to have MBAs to advance usually, not always, foot the bill.
There are few companies in the world in which you will be absolutely happy working for. There are always ups and downs to every job and company. If you are in the rare position that you really like the people you’re working for and you feel inspired to get out of bed every morning, it’s not a bad idea to pursue a Masters in Business Administration.
Therefore, if the company requires it for you to advance in your career path quicker, then you should go for it. I actually snuck into MBA classes when I was an undergraduate student. The things that they learn is quite interesting and things that you can actually use in the real world.
One class taught how to play office politics and gain influence for ideas to come to fruition. Ideas that are never taught in undergrad.
2) You Want to Expand Your Network
Alumni networks at undergraduate institutions are very strong. Alumni networks at the higher education level are even stronger. Business leaders didn’t start businesses with their friends. They started businesses after they met amazing people in higher education.
People who pursue an expensive educational program are usually financially capable of doing so. The ones with a lot of financial power are usually the ones who are most generous.
If you are in a bind, alumni networks are more than likely to help you out. Not in terms of money, but in terms of time and effort. They love giving career advice and helping others to succeed. If you think alumni connections aren’t helpful, you can find out for yourself.
Research your college’s alumni database and reach out to them after finding common ground. Maybe you want to learn more about their industry or job. They will be more than happy to talk to you if they aren’t busy themselves. You will be surprised how happy they are to help you out.
3) You Want to Start a Business
Larry Page met Sergey Brin at Stanford University. Lynn Jurich started SunRun with fellow Stanford classmates. These stories are becoming more and more common. Additionally, college have their own incubator programs to encourage entrepreneurship within their student body.
They want to be known for their entrepreneurship program because people are very interested in it. People love the autonomy that comes with entrepreneurship and potentially change the world. There are very few programs out there that will give you the support you need that comes with starting a business.
Additionally, those programs are phenomenally competitive to get into anyway. Y Combinator’s acceptance rates are 3%. Therefore, a great alternative is to advantage of the resources that your college offers to start a business. It’s available on some capacity at the undergraduate level.
However, it’s available in a huge capacity at the graduate level. It’s not a bad thing to get an MBA because you want to pursue entrepreneurship.
4) The School or Government Pays For You to Get an MBA
It’s undeniable that an MBA is an asset. You have a competitive edge over someone who doesn’t have an MBA. Therefore, if a company or a college offers to pay for your MBA, then it’s a “no brainer” decision. Someone else is investing their hard earned money for your education.
Why wouldn’t you take it? You should always take that option. Remember that I said it could take 7 years to recoup all of your investment in the earlier example? Someone is offering to take that 7 years of waiting off your plate and table. That’s not a win in just money but in terms of time as well.
That’s a deal that’s difficult to pass up. Companies that pay for the entire two years usually require you to stay on for two additional years after school. That doesn’t sound like a bad deal to me.
Why Should You NOT Get an MBA? The Wrong Reasons
While there are right reasons to pursue the opportunity, there definitely are wrong reasons as well, just like with anything. Below are the bad reasons to get it.
1) You Want to Change Industries
Do you really want to be dependent on you spending $100,000 to change from the industry you’re working in to another? Why would you rely on someone else to change industries for you? You can easily go out, network, and actually talk to people.
The best part about going out and networking is that it is a completely free solution. You don’t have to pay six figures to go this route and try it. There truly are cases when you tried everything you possibly could and still fail. Some people can’t change industries even after trying this route.
Then and only then should you consider getting that graduate degree. However, people don’t even try this route before even considering an MBA. You are more marketable than you think. Every no gets you closer to a yes. While it’s not the easier solution, it’s the cheaper and better solution.
2) You are Miserable at Your Job
Can you really not find another job, ask for a transfer to a different department, or any of the 100 other things that you can do? There are people who get an MBA because they want to “rebrand” themselves and get a completely new job. Are you really unable to negotiate your work situation with your boss?
It may take 5 months or so to find another job but you can absolutely do it. The average time it took for me to find a job was about 5 months. For me to find a good job? It was about 8 months. Regardless, your situation can be better in just eight short months. Think about that.
It’s not the best reason to pursue the degree when it’s because you are just miserable at your job. At worst, you can quit and look for a job afterwards. You have more choices and options than you realize.
3) Others are Doing it
These days, graduate degrees provide diminishing returns every year that passes. Why? So many people are getting it. If 10,000 are doing the same thing, do you really want to be the 10,000 and first person to go for it? Peer pressure and social pressure isn’t the best reasons.
One of my coworkers is about to graduate with one. The government is paying for 100% of his tuition expenses. That doesn’t make me jealous. I am completely and fully OK that I don’t have an MBA and I always will be. It’s not a good reason to follow what your friends and the crowds are doing.
They may pursue one because they have different goals than you. Find out what your own goals and motivations are then act on them. Independent of someone else’s goals and motivations.
4) You Want to Increase Your Earnings Potential
With the invention of the internet these days, there is no telling how much you can earn in a year. You can start side hustles and increase your earning potential that way. The great part? Most businesses don’t need $100,000+ to start. You can start one with a couple hundred dollars, depending on the side hustle you want to get into.
If you’re doing an evening MBA, you are not going to be able to pursue a side hustle easily. A full time job, an MBA, plus a relationship to take care of? There’s only so many hours in the day.
If you truly and honestly don’t think you can generate a side hustle that earns you an extra $35,000 per year after two years of working on a side hustle, then you should go for it. Remember that life is long. Two years is an insane amount of time you have to work towards earning that income.
Even if not through a side hustle, you can always increase your earnings potential by interviewing elsewhere or negotiating for a pay raise. There’s many other ways to make more money. You just have to go out and do it.
When Should I Get my MBA?
So after considering the pros and cons of the question “should I get my MBA?” now you’re wanting to know WHEN should you get your MBA is the right time. I’ll tell you when the wrong time is. Don’t get one straight after undergrad. Without any work experience, companies perceive you as not that different as an undergrad graduate.
Get one after 4 – 5 years of work experience. Harvard actually recommends work experience before you start one. They accept candidates on a deferral admission basis. The minimum amount of work experience you should have is two years.
That’s when you had enough time to apply the knowledge you learned in undergrad so then it’s time to level up your education. Most people who get an MBA are in their late 20’s, mostly in 26 – 29 category. There are outliers but that’s the general average.
There is such a thing as getting an education too quickly. Only the very few should get an undergraduate education when they’re 14 or 15. The same applies to graduate degrees as well. Some companies will take an undergrad graduate with 2 years of experience more seriously than a graduate degree holder with no experience.
Be careful. You don’t want to be one of those who paid a lot of money for a piece of paper that isn’t going to help them much. You have to be strategic in both timing and reasons when potentially going into debt for a degree that may or may not be worth it.
Should I Get My MBA? You Can Probably Get There Yourself
The final general answer to “should I get my MBA?” is generally no. Is school really going to solve all of your problems? It used to be worth it 15 – 20 years ago when fewer people pursued it. More and more people hold the degree and it’s a huge risk to get the degree in the first place.
Remember that I make more money than some graduates who hold a Masters in Business Administration. I didn’t go to an expensive and fancy Ivy League school for my undergraduate. There’s no reason why you can’t be in the same position as well. Instead of looking for someone else to solve your problems, solve your problems yourself.
When people say “an MBA is totally worth it,” what they really mean is that it will help you move forward. Well of course. What $100,000 investment won’t help people move forward? The right question is, will it be worth the cost that you put into getting that degree.
The alternative is just investing that $100,000 in the S&P 500 and enjoying the average 7% return (it may differ going forward) that comes with it. It’s a completely passive way to come out ahead and you don’t even have to lift a finger while your money is doing all that work for you.
There are very few situations that you can’t get out of yourself. Cancer is one of them. However, things like being in a dead-end career is absolutely a situation you can get out of. Instead of depending and relying on someone else to take care of that problem for you, why wouldn’t you want to do it yourself?
It’s a much cheaper and better solution.
