Is an MBA Worth the Money?

Here on the HubSpot Marketing Blog, I haven’t exactly made it a secret that I went to business school. It was an experience that provided two years’ worth of fodder, lessons learned, and other actionables that I like to share here.

But there’s one question I have yet to answer, at least in this venue, about the time spent earning my MBA: Was it worth it?

It's a question I considered even before I began applying to different business schools, and one in which I'm certainly not alone. When I asked my colleagues if any of them had experienced the great “Should I get my MBA?” debate, there was a clamor of responses. Many of us -- all marketing professionals -- had experienced the same decision-making process, which made us realize how many other marketers out there must be going through the same thing. 

While the topic seems to be eternally up for debate, we agree that there are instances when people should, in fact, go for an MBA -- but it’s important to have a clear idea of what those circumstances are, and if they really apply to you. And if they don’t, fear not: There are alternatives. We’ve outlined the factors that do make an MBA worth the investment -- and the other things you can do until that day arrives.

When an MBA Is Worth the Money

1) When you know exactly what you want out of it.

Before I began studying for the GMAT -- the required admission exam for most MBA programs -- I spent about five years deciding whether or not to apply to business school. I had a lot of questions, many of which were shared by my colleague, Mimi An, when she was faced with the same decision. For her, she told me:

The biggest things to consider were if I was at a place where I couldn’t progress further in my career, if I wanted to change function or industry, if I wanted to move, and what exactly I wanted out of the degree. I couldn’t answer the last question. In fact, the answer was 'no' to most of my questions. I could still progress. I did not want to change function. I did not want to move. I didn’t know what I expected to get out of it.”

According to Investopedia, the average cost of an MBA is $140,000 -- and $260,000 if you’re not working or earning any income while you’re in school. Think of it this way: Would you spend that much on a luxury car or new condo if you weren’t sure why you were buying it? That’s a big chunk of change to spend on something that you aren’t certain is going to benefit you in some way.

Of course, for many people, the answer to those questions is overwhelmingly “yes” -- in fact, they were for me. At the time, I wasn’t progressing in my career and I wanted to move, which are two fundamental reasons why I ultimately made the decision to go to business school. But not everyone will have the same responses to those important questions, nor do they come easily to anyone -- so be sure to put sufficient time into them.

2) When your work isn’t teaching you what you need to grow.

There’s an important point that An made in her quote above -- how much room for growth you have in your current career trajectory, whether that means you’re able to progress in your current job, or do it elsewhere.

If you’re not getting the right learning opportunities in your current workplace, but you’re also short on some of the skills to progress in another role or company, it might be time to think about getting an advanced degree. It’s what Jim O'Neill, HubSpot’s chief information officer, realized early in his career here, when he was also considering leaving to pursue an MBA.

“I couldn't get it out of my head that I'd be giving up more by leaving the company at that stage than I'd ever be able to learn in business school,” he said. “And while I still might want a graduate degree someday, I was lucky to stay, learn, and grow over the following six years.”

But again -- everyone’s experience is different. When O’Neill was contemplating this decision, HubSpot happened to be scaling up, which forced him to learn a lot of crucial business lessons as a byproduct of being in the throes of a company’s earliest stages. Not everyone will be in that same position, and some people will have to seek the lessons O'Neill learned elsewhere.

Depending on the program you choose, an MBA could be the best place to gain this knowledge. So when you’re making this decision, carefully evaluate where you are in your career, and how much you can learn on your current trajectory without an advanced degree.

3) When you actually have the time to dedicate to it.

During my first semester of business school, I was working full-time while also completing my coursework. Granted, most of my classes were at night, which on the surface seems like a convenient arrangement. But as any student will tell you, your academic work extends far beyond the hours you spend in the classroom. There are exams to study for, papers to write, and group projects to complete.

In other words, if you add that to your current professional workload -- your nights and weekends are pretty much toast. At least, that was my experience.

That may seem like a sacrifice you’re willing to make, but think about it, in the context of the previous points. Even if you’re certain of your reasons for pursuing an MBA, do you really have the time to dedicate to it? Will you also be able to sufficiently take care of yourself, and spend enough time with loved ones to maintain a measurable level of mental health?

It’s easy to think that the answers to those questions are “yes” -- in fact, I told myself that I would have plenty of time to work out between classes or before work in the morning, and to cook healthy meals ahead of time on the weekends. And while that was sometimes true, it required extremely strict time management, and left precious little time to actually relax.

My colleague, Karla Cook -- who’s working full-time while pursuing her master’s degree -- agrees. “I tell people the only reason they should work full-time while pursuing a graduate degree is if they get offered an opportunity that falls in the ‘dream job’ category,” she explains. “If that's not the case, then it's probably not worth completely killing yourself over, because you will have no free time.”

But the good news is, it’s temporary. Business school doesn’t last forever -- though it might seem like that while you’re going through it. But before you seriously consider going through this kind of program, have a clear idea of what’s going to make it “worth it” to you. Having that goal in mind gives you something tangible to keep you motivated during these stressful periods.

4) ... And when you have the money saved.

They say that “time is money” -- and just as you must be sure you’re willing to sacrifice the former, you also have to make certain that you have the latter. Remember those aforementioned dollar figures we cited about the true cost of an MBA? File this point under deciding what will make the degree “worth it,” with “it” being the hundreds of thousands of dollars that your degree will likely cost.

When you’re deciding whether or not to go to business school, ask yourself if you can afford to take on student loan debt. If you’ve just bought a house, paid for a wedding, expanded your family, or bought a car -- the answer might be “no,” unless you happen to have a lot of liquid funds at your disposal.

That said, loans aren’t the only answer. You should also see what other resources might be available to you, like scholarships or fellowships, some of which might even be available through the school you end up attending.

When you begin selecting which programs you’ll apply to, explore their respective policies on merit-based financial aid -- that’s the kind that you don’t usually have to repay. There are several guides to external merit scholarships available to MBA students, as well, like this one from GoGrad.org.

5) When the program’s career resources will actually help you.

At risk of sounding like a broken record, this point also speaks to the idea of what will make an MBA program “worth it.” Again, everyone’s priorities are different, but if you’re going to business school with the hope of advancing your career with a new employer, make sure the school you choose has the right resources to support your job search.

This factor is one that institutions know prospective students take seriously. In the Graduate Management Admission Council’s Alumni Perspectives Survey Report 2017, 91% of respondents indicated that they found their MBAs to be “professionally rewarding,” and many schools feel a lot of pressure to uphold that significant figure for their own students. For that reason, many graduate students have found advertised career services to sometimes be a bit embellished. Cook echoes that sentiment, and says she's come across many graduate programs that lack “any useful career benefits," despite what they claim.

In my own MBA experience, those services weren’t exactly embellished, but they were removed from the university’s budget after I had committed to the program. That wasn’t entirely negative -- experiences like those can teach some students crucial lessons on networking and other valuable job search skills. Evaluate the resources available to you through a very fine lens, and consider how much of a priority they are in selecting a business school.

6) When your employer will cover your tuition.

This one seems a bit obvious, but it requires some reading between the lines, so to speak. If your employer will reimburse your MBA tuition, it might seem like a proverbial no-brainer to take advantage of that benefit. But understand what will be required if you do.

First, understand that you’ll most likely have to pay taxes on any amount of reimbursement you receive over $5,250. Also, some employers require you to stay with the company for a certain amount of time upon completion of your degree as a condition of receiving this benefit. Once again -- ask yourself what your reasons are for pursuing an MBA. If they include progressing your career in a new work environment, taking a route that requires you to stay with the same employer for at least two years after you graduate might not be the most optimal one.

You might notice that many of these considerations work in tandem. For example, the point above about tuition reimbursement from your employer could be countered by having enough money saved to invest in the degree yourself, or being in a position to use student loans. That’s why we encourage you to spend ample time thinking about all of these factors -- getting an MBA isn’t a minor decision.

When an MBA Is Not Worth the Money

1) When you should get a different degree.

Maybe -- just maybe -- you’ve decided against getting an MBA because it’s simply not the right degree for your career trajectory, or for what you’re hoping to do. If you’re looking to specialize in corporate communications, for example, it might be worthwhile to look into graduate programs that specialize in it, and have the catered career resources to support it.

That idea re-emphasizes the importance of knowing exactly what you’re hoping to gain from an MBA. When you outline your goals, compare them to the standard coursework required of an MBA, and see if they align. If not, it might be time to look into a different academic concentration.

2) When you can work for an emerging or early-stage business.

Remember O’Neill’s great story of how much he learned from sticking with a company that was scaling up -- in lieu of pursuing an MBA? As we mentioned earlier, working with a company in its earliest stages often forces its employees, whether they like it or not, to learn a ton of business fundamentals.

In a valuable MBA program, you should learn such fundamentals as managing budgets, personnel, projects, and -- when the company really begins to take off -- scaling it to keep up with that growth. Sounds a lot like the type of thing that managers have to learn with a new, emerging business, doesn’t it? If that’s the type of work and knowledge you crave, it could be time to look for job opportunities with a company in these early stages.

3) When you can use individual courses to gain the skills you're missing.

When I was in business school, I was fortunate enough to have some truly great professors. But I also learned something else -- without naming names, I realized that while many academic instructors are experts in their respective fields, that doesn’t mean they excel when it comes to teaching.

That meant, for certain subjects, I sometimes had to seek outside resources to supplement classroom teachings -- most notably, Khan Academy, an online provider of free classes and courses. I found out about it through a classmate in a particularly difficult class, and once I started using it for that particular topic, I saw how much knowledge the site has to offer.

And while I wasn’t about to abandon my MBA to self-teach via this resource alone, it did make me realize that, for individual areas and skills, sites like these can be a tremendous help to those who aren’t ready to pursue a full degree, but want to improve their professional credentials. And Khan Academy -- despite offering a plethora of courses on subjects ranging from economics to art history -- is hardly the only resource of this kind. Our favorites include Coursera, edX, HubSpot Academy, Lynda, and Udemy. Even better, some of these sites, like Coursera, actually offer classes taught by faculty of some top-tier schools, including Stanford.

To B-School, or Not to B-School

Deciding whether or not to pursue your MBA is a pretty big decision -- it can be a significant investment of both time and money. But, for many, it’s worth it. And now, you have a checklist to help make that decision just a little bit easier.

And as for me -- the verdict is in. My MBA was worth it. In the thick of my coursework, I did sometimes question, “Why am I doing this?” Plus, I agree that there are many times when the investment just isn’t necessary. But in the end, I remain very happy with my decision to go to business school. I got to experience living in a new city, gain new skills, and figure out what I don’t want to do, which, to me, is a milestone in one’s career progression.

All in all, I think of it as a very productive use of my time -- and I want it to be for you, too. You’ll make the right decision. But please, don’t make it in a hurry.

What are your thoughts on pursuing an MBA? Let us know in the comments.