The Real Cost of an MBA

Higher education costs in the United States have outgrown the rate of inflation, and getting an MBA has associated tuition expenses, along with rent and book costs. MBA graduates, especially those who attended private or well-known business schools, can accumulate between $100,000 and $200,000 in debt and expenses in about two years. Fortunately, those highly motivated to secure an MBA can explore alternative options to receive the degree and try to minimize the costs.

Key Takeaways

• MBAs offer the potential for career flexibility, enhancement, and advancement opportunities but can also come with a steep price tag.
• MBAs from private and public business schools can cost between $100,000 and $200,000 in debt and expenses in just two years.
• A part-time or evening MBA program can allow you to retain your full-time job.
• Some companies, especially Fortune 500 corporations, might assume partial or the entire cost of an MBA program.

MBA Costs Are More Than Just Tuition

Business schools market their programs in order to jockey for competitive positioning, mostly by way of attempting to secure higher rankings among peer groups. You might view the degree as a way to achieve greater career flexibility or as a way to open doors for new functions or industries. However, you should never assume that an MBA automatically means anything for your career. To be a meaningful investment of your time and money, it must enhance your experience and abilities, be an established step or boost in your industry and career, or be from a top school employers want to hire grads from.

Thus, it is important to assess a program beyond only tuition rates. Many schools have started publishing estimates of total attendance expenses to allow prospective students to financially, professionally, and personally prepare for their programs. For example, Harvard Business School provides expense estimates for single, married, and married students with children. The school estimates that a single MBA student attending Harvard could expect to pay about $118,800 per year in total expenses, of which about $76,400 is tuition (for the 2024-2025 year). Stanford, the University of Pennsylvania (Wharton), the New York University (Stern), and the University of Chicago (Booth) are even more expensive.

Note

Many schools have financial assistance programs or even full-time scholarships for certain students. It helps to investigate all MBA programs and schools to see what they have available.

You may want to find an MBA program with more acceptable costs. Programs at lesser-known public universities may offer a less expensive option. Exploring the full menu of public school MBAs allows you to cut your debt in half, especially if your state university has a business school. For example, the University of Georgia Terry College of Business’s tuition was $34,236 for non-residents and $13,918 for residents for the 2024-2025 school year. The full-time MBA (a two-year program) was more than $71,000 in tuition and fees (for a non-resident, plus any living expenses).

In comparison, its online MBA was more affordable for non-residents, at about $56,000 in tuition and fees for a 17-, 20-, or 22-month program.

Lost Salary or Wages

One of the least-often mentioned expenses of attending an MBA program is the time you’ll need to take away from earning to attend a full-time program. If you can’t afford not to work and go to school full-time, you’ll need to find a part-time program.

Part-Time Programs

You might be able to find a part-time or evening MBA program that allows you to retain your full-time job. These programs typically take three or more years to complete, but some online, executive, or professional MBA courses have compressed timelines. For instance, the Terry College of Business offers part-time programs of 20+ hours per week, split between in-person and distance learning. You can also choose from program durations of 17-, 20-, or 22-months. Many other schools will have similar program choices.

Your Company May Pay Help With the Costs

Some companies are willing to assume some of the costs of an MBA program. A few might even pay the full tuition. Others might pay for or contribute to a master’s degree in accounting or finance or help with the costs of attaining a CPA or CFA license.

Concerns About MBAs

If you have a family, you should exercise caution in undertaking a full-time job as well as an intensive part-time MBA program. It can be challenging to find time and attention for loved ones, household duties, and the curveballs life throws. With a family, your success depends on their support and understanding—you could easily dedicate 70+ hours per week to work and academics.

One risk of pursuing a graduate degree is that the lost wages and increased debt may not help you get a better-paying or more rewarding job. That’s why it’s essential to fully understand how an MBA is viewed in the field you’re in or want to get into and whether it will help you achieve your goals.

What Is the Total Cost of Getting an MBA?

It depends on the school you choose. Tuition and the cost of living in different areas vary, but generally, you’ll pay between $100,000 and $200,000 in tuition to attend the most reputable schools. It is much higher if you factor in the living expenses, lost wages, and fees.

Is an MBA Worth It Financially?

Many top businesses require prospects to have MBAs from top-rated business schools, which cost more. However, pay at a Fortune 500 company is much more lucrative than at other companies. Again, it depends on the school you attend, how much you pay, where you end up, and what you do with the degree after graduating.

Is an MBA Worth It After 40?

It can be, depending on what you have accomplished professionally. You’ll need to be confident that the benefits you receive from achieving an MBA outweigh the costs, such as a salary or employment timeframe that allows you to pay off any student debt and achieve the standard of living you prefer. Additionally, you should consider the lost opportunity cost to your retirement savings, if any—the money you spend on an MBA at 40 might be put to better use in your retirement accounts, depending on your circumstances.

The Bottom Line

Given that an MBA program is a capital-intensive endeavor, exercise the same level of diligence as if you were purchasing a home—it costs that much after combining expenses, lost wages, and tuition.

You can choose from various schools and programs tailored for working adults or online MBA programs that can lessen the scheduling demands. Consider the schools in your state, as they might charge you much less than a school in another state where you’d pay non-resident tuition.