The two-year MBA – Is it worth it?

Expect to pay between $80,000 and $130,000 for a two-year MBA program. It isn’t cheap, and the fact is the more you pay the greater chance your degree will be recognized. Top tier schools like Harvard or Wharton have higher tuition fees than less prestigious business schools.

Return on Investment (ROI)

There is no doubt that such a program is costly, but don’t forget, you will likely receive an impressive return on investment (ROI). Having a rough idea of how long it will take to regain the money spent on your program can be reassuring. Tools like QS Scorecard can be utilized to provide customized results pertaining to your particular situation. For example, an Indian MBA hopeful wanting to study in the UK may find Lancaster, Oxford, and Ashridge will likely provide the highest ROI; that is, twenty years following business school graduation, the percentage of the amount invested in tuition costs will be highest after attending one of these schools, as opposed to others.

You can get a rough idea of the time it will take to regain your business school expenses by examining the ROI of three different schools offering different programs: a two-year program at a top US school, a two-year program at a less competitive school, and a one-year program at a business school in the European Union (EU). These programs are used to represent the normal range of international programs available throughout the world. Harvard, Rutgers, and INSEAD will be used to demonstrate the above. The following results are based on a female with two years work experience and a pre-MBA salary of US$40,000, employed by a company with fewer than 5,000 employees.

Top US school Harvard will require an investment of approximately US$147,000, yet the graduate can expect about a 47% salary increase (this figure will vary depending on the graduate’s post-MBA occupation). Therefore, we can predict an approximate time period of seven years to ‘break even’; that is, to regain the cost invested in the MBA program.

Attending Rutgers will cost the student approximately US$108,000 for the two-year program. In comparison to Harvard graduates, the MBA graduate from this university can expect about a 69% increase in her salary, resulting in only a five-year period to ‘break even’.

Graduates of the one-year MBA program at INSEAD in France can expect approximately a 55% increase in their salary, post-MBA। As the tuition cost is US$90,000, we can conclude that it would take about four years to ‘break even’. Cranfield, in the UK, yielded very similar results.

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So is it worth it?

The two-year MBA has its advantages and disadvantages but the bottom line is that most MBA programs will provide its graduates with a respectable return on investment and greater career opportunities। If you have a bit more money (a scholarship or a good loan package!) and two years to spend studying, why not invest in a comprehensive program that will prove enriching in the short term and give you time to fully develop new skills and meet contacts who may become lifelong friends or business associates.
(courtsey : topmba.com)