There is no right answer to this question. People tend to be fervently for or against MBAs but the decision is highly dependent on individual situations. In this post we'll discuss considerations associated with full-time MBAs.
Using an MBA as a stepping stone to switch careers is the best reason to get an MBA. It will help you crack into investment banking, private equity, big tech, consulting and other opportunities that may have been closed off if you did not pursue them immediately after undergrad. It can also lead to salary increases if you return to the same field you were in pre-MBA.
People often rank “he network” as their top reason for going to business school. The logic is you will meet like-minded, motivated individuals and these relationships will be advantageous down the road. This is all true but should not be the primary reason for wanting to go to business school (see Career Switch above). The network you build in the workforce can be just as powerful. All it takes is one great mentor to catapult your career.
The core courses include economics, stats, finance, accounting, and leadership. Every school differs but if you were a business major in undergrad there will be significant overlap. You can pass out of the intro courses if that is the case. We'd recommend taking the minimum amount of required business courses then exploring other fields. Accounting, finance, and “business” can easily be learned on the job.
This is the elephant in the room. Per their website, the current all-in cost of an MBA at Wharton is $114,896 per year (including room and board). That’s a staggering $229,792 for a two year degree. We understand students receive merit scholarships but even if you are paying 50% to 70% of the total, it’s still a large number. You then have to take into account the foregone salary had you stayed in the workforce. The all-in cost can approach $500,000. The cost should not necessarily deter you. You should view it as an investment in yourself which can lead to wealth creation in the future.
A thought experiment to consider when rationalizing the cost is a follows: If you took $229,792, or even a fraction of that amount, say $10,000, and invested it in yourself, would you learn more? Think of the online classes you could take, the hobbies you could indulge in, and the skillset you could acquire. The compounding returns could be higher than an MBA.
Once again, the decision to get an MBA is unique to each individual. It truly is an investment in yourself. We’ve seen people with and without MBAs both succeed and both fail. The most successful people have a propensity for getting things done – something they don’t teach in business school.
We’ll leave you with the below quote from Nassim Taleb, a statistician and expert in risk analysis. It's frustrating that the value of the degree is largely predicated on the name of the school. Having said that, he received an MBA from Wharton and clearly found value in it at the time, so take it with a grain of salt.
“You can tell if a discipline is BS if the degree depends severely on the prestige of the school granting it. I remember when I applied to MBA programs being told that anything outside the top ten or twenty would be a waste of time. On the other hand a degree in mathematics is much less dependent on the school (conditional on being above a certain level, so the heuristic would apply to the difference between top ten and top two thousand schools). The same applies to research papers. In math and physics, a result posted on the repository site arXiv (with a minimum hurdle) is fine. In low-quality fields like academic finance (where papers are usually some form of complicated storytelling), the “prestige” of the journal is the sole criterion.” - Nassim Taleb, Skin in the Game