Jun 20, 2022 | Advancing Your Career

When is it worth it to get a MBA? Is the degree worth being in debt?

Q. Dear Zenagos, my boss tells me that I need my MBA in order to get promoted. Do I really need to quit my job and go to school for two years? Is it worth it to go to a part-time or online program instead? I have read that MBAs are not worth the debt.
–Daniel

Unless your boss has explicitly promised you a sizable raise along with a promise to pay for your degree (in exchange for your commitment to stay a few more years), I wouldn’t count on the MBA paying off in the scenario where you stay at your same company. Obviously, everyone’s personal situation is different, and maybe you have a super-trustworthy boss, but in my experience, the words “Yeah, we’d promote you, but you don’t have an MBA” are more a convenient excuse than a commitment to you. Ask for the commitment in writing.

As you think about an MBA, compare the salary that you think you will earn after getting the MBA against your out-of-pocket expense for the degree. Often, companies have some kind of tuition reimbursement program, making a part-time program a good deal. (You still have your income from work, and you don’t have to foot the entire tuition bill.) In the case where your company is willing to fund your entire degree (which is rarer, but does happen), you will need to weigh the multi-year commitment of staying at that company against the benefit of getting your degree paid-in-full. If you like the company, it can be a no-brainer.

Often, we see people wanting an MBA in order to switch careers. This is a great reason to pursue an MBA. Firms that recruit MBAs generally don’t care what type of work experience you had prior to business school. You just need to tell a coherent story about how it all ties together. In business school, you will meet people from a wide variety of industries and roles, which may help you choose your new path. And, an MBA career path may lead to faster advancement than your current role.

However, you should not assume that an MBA will give you an automatic path into a lucrative field like management consulting, private equity, or Wall Street finance. These jobs are easiest to get when you graduate from a highly elite (Top 10) business school, and even then, you will need to shine in a very competitive interview process. An MBA is a terrific tool for changing careers, but it is not a magic golden ticket.

Part-time and online programs can be just as good as full-time programs. However, you need to confirm that the university’s brand is respected in the geography where you want to work. Ask some hiring managers that you respect how they feel about MBAs from that institution. Also, make sure that your diploma won’t say “part-time” or “online” on it – the degree conferred needs to be the same one that is granted to full-time and on-campus students, and the classes need to be taught by the same faculty. If they are not, move on to another option.

As you go through your consideration process, try to understand what’s driving you toward the MBA. You might find that you could fill your knowledge gaps in more cost-effective ways. Maybe a mentorship program or a couple of finance courses would get you most of the way there. Maybe you need a boss who supports you and shows you how to advance your career, rather than one who just gives you reasons why you can’t be promoted.

As with any large investment, it is important to do your research and know the value you will get for your money. Start by evaluating your own motivations and expectations, so you make the choice that is right for you.

Related blog posts: “Do I need an MBA to start my own business?

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