An MBA can help someone earn a higher salary, change or advance careers and develop further business skills.
Costs for an MBA can be steep, but lesser-known schools, online schools or state schools may help save on the price tag.
An MBA can also be a massive time commitment, but options like part-time programs or online options can help professionals stay employed while pursuing additional education.
If you decide an MBA isn’t right for you, alternate options include certificates, certifications, mini MBAs or a different master’s degree major.
A Master of Business Administration Degree can cost anywhere from under $20,00 to over $120,000 per year at an Ivy League school like Wharton. That investment in tuition can lead to increased salaries after graduation, but it’s not a guarantee.
To answer the question “Is an MBA worth it?” you should have a clear picture of your career goals and a full understanding of the opportunity cost involved.
Benefits of MBA degrees
Why get an MBA? An MBA degree can make a huge difference in students’ career potential and future salary.
Higher salary potential
Many people pursue an MBA for improved earning potential, with many business professionals earning more than $100,000 annually. Of course, your salary depends on your area of expertise, company, location and more. PayScale data shows that the average MBA graduate earns around $96,000 nationally. In contrast, a bachelor of business degree-holder averages $71,000 per year.
Greater opportunity to advance or change careers
Along with a salary increase, many MBA graduates enjoy improved access to leadership positions. MBA programs often focus on leadership and management skills to ensure that graduates can take that forward step professionally.
Employers are also looking to hire graduates with MBA degrees. The Graduate Management Admission Council found that 90 percent of surveyed recruiters planned to hire MBA graduates in 2023.
Ability to develop highly marketable skills
MBA programs equip business professionals with marketable and in-demand skills.
MBAs with concentrations in finance, marketing and information technology teach skills like investment analysis, brand management and cybersecurity, respectively. These skills are necessary for high-paying roles like chief financial officer, management consultant and information technology manager.
In non-specialized MBA programs, students hone communication and critical thinking, along with their networking and people skills.
Learners also explore the inner workings of businesses. They learn strategy and analytical skills, which can help them become more effective team and project managers. While other graduate degrees can provide students with many of these skills, MBA programs are tailored to develop well-rounded professionals.
However, you’ll have to decide if learning these skills through a structured program has value for you. If you are already in a management position, you have learned many these skills on the job. You may also be able to learn these skills in a future job.
MBA degree costs
An MBA degree isn’t right for everyone. Depending on your financial and career situation, you may want to pursue a different type of education.
Tuition and other expenses
Over the course of a one-year or two-year MBA program, students could pay more than $200,000 to complete an MBA degree.
Private universities often cost more than public universities, and in-state tuition is typically cheaper than out-of-state tuition. Full-time or in-person programs can cost more than part-time or online programs.
Plus, if you’re interested in getting an MBA to network and pursue jobs at prestigious firms, you may have to pay the premium for an MBA from an Ivy League program.
Take a look at our student loan calculator to help find out how feasible it might be to finance an MBA.
How to make an MBA more affordable
There are a few tips that might help you find an affordable MBA option:
If you work for an employer that will pay you more for getting an MBA and doesn’t consider the quality of schools, getting an MBA from a less prestigious school is a no-brainer.
Fellowships and scholarships can help offset the cost of an MBA. According to University of Utah data, 80 percent of their 2022 graduating MBA class received a scholarship of $30,000 or more. You can also take a look at these grant and scholarship resources.
Consider signing up for a 529 plan in your name to save on state income taxes by passing your tuition payments through the account.
MBA programs often require a two-year commitment to intensive, full-time study. This can create challenges for parents, new graduates with school debt or professionals who cannot afford to lose their jobs. You might face a gap in your resume as you take time off for school, plus the lost income. But many part-time and online MBA programs allow you to attend around existing work schedules.
Executive MBA programs are typically shorter than traditional MBA programs. They focus on existing professionals and allow those with real-world management experience to skip the basics and dive into more advanced topics.
Executive MBAs are often offered online with flexible timelines to accommodate students’ existing responsibilities.
MBA program alternatives
A traditional MBA is not always the answer. For some students, a different program can provide more suitable and accessible training.
Certificates and certifications
Many college certificates offer specialized training in an accelerated format, covering topics like project management, accounting and marketing. Students can develop focused skills and knowledge without committing to years of schooling.
Professionals looking to excel in their current role or quickly expand their skills may find certificates a better option than an MBA.
Certifications, on the other hand, come from industry organizations and help professionals demonstrate their qualifications. These credentials reflect a person’s skills within a specific field, such as a social media marketing or business administration certification. Certifications also cover vendor technologies and applications, which may help professionals land new or more advanced careers.
A different master’s degree
For students aiming for a specific field, a specialized master’s degree can provide more in-depth and focused training than an MBA.
While an MBA provides comprehensive training and marketable skills, specialized master’s programs delve into advanced concepts of one field, such as accounting, finance or marketing.
A mini MBA compresses a basic business education into one to six months of education — but they don’t provide a degree. These programs may focus on a group of core business skills or on specialized knowledge. Mini MBAs also cost considerably less than MBAs and require less experience for admission.
These crash courses in business can help new graduates quickly develop advanced business skills or allow experienced professionals to pick up specialized knowledge without sacrificing employment. While a mini MBA cannot match the depth of training in a traditional MBA, it can give business professionals a competitive advantage without the commitment of a full degree.
When is an MBA worth it?
Some careers require an MBA, so pursuing this advanced degree makes sense if your heart is set on a specific job. For example, you may need to earn an MBA if you want to become a financial manager or if you want to climb the corporate ladder to become a top executive.
An MBA can lead to personal and professional benefits, but many people choose this route for financial rewards. Eighty-seven percent of respondents in a GMAC alumni perspectives survey said their MBA increased their employability, and 68 percent of respondents found it financially rewarding.
Compare tuition costs for the MBA program you’re considering with the salary you might earn in your future career, which you can research on the Bureau of Labor Statistics website. Once you know what your MBA will cost and how much it might earn you, you can decide if the program is right for you.
Is an MBA worth it in 2023?
Tech CEOs like Tim Cook and the late Steve Jobs are famed for saying that a college degree isn’t necessary. But when it comes to hiring practices, their company Apple values MBAs and even has an internship program dedicated to recruiting MBA students.
Just like a bachelor’s degree, an MBA is a requirement for many jobs and levels of employment. While many programs are now online, reducing the networking benefit of attending an MBA program, having an MBA listed on your resume can still get your foot in the door.
There’s also been some debate if an MBA carries the same weight as before the pandemic. As more people turn to remote work, traditional skills like in-person networking that make up the backbone of many MBA programs may seem unnecessary. Additionally, the business world and technology evolve fast. What you learn in school might not keep up.
Assess whether the program you’re eyeing teaches skills like adaptability and strong leadership in the face of shifting technology. For example, the University of Utah specifically lists changes to its MBA program for a post-pandemic world, including managing remote teams. Even then, you may personally prefer a learn-as-you-go approach on the job.
If you’re not interested in an MBA for traditional corporate employment, an MBA may not be worth it for you. Free and paid online courses are so common now that you can learn marketing, business management, finance, technology, project management and more for a fraction of the cost of an MBA program.