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Frequently Asked Questions:MBA Finance
MBA Finance: Frequently Asked Questions about the important aspects of MBA salaries and financing your business school course.
mba finance
What is the current payback period for MBAs graduating from US and European business schools?
Even though course fees have risen in recent years, from top business schools, salaries and bonuses have also risen and the payback period has actually reduced slightly over the last five years.
MBA salaries for graduates from international programmes have increased significantly over the last two years, and this has continued in 2007. Average MBA salaries graduating from a top US business school like Tuck, Chicago, Wharton and Stanford averaged $110,000 last year, compared with an average of $93,500 amongst MBA recruiters in the USA and Europe, and an average of $71,500 amongst recruiters in Asia. To calculate true earnings one should also take into account a “sign-on” bonus offered by many MBA recruiters, and the potential to earn a further $15,000 during a summer internship.
Against this, to estimate the ‘true cost’ to complete an MBA, we should take into consideration tuition costs, living, travel and book costs. We assume annual living costs and book costs of $23,000 per annum and apply a weighting depending on whether the location is rural, suburban or metropolitan. In addition the opportunity cost of salary foregone, must be included in the calculation and a typical tuition cost of approximately $40,000 per annum.
Using these assumptions, for someone with a pre-MBA salary of $50,000 and joining an average recruiter in the US or Europe, a two year MBA taken at a top US business school would have a payback period of approximately three years. Using the same assumptions, for a one-year European MBA the typical payback period is approximately two and a half years. Someone returning to an average Asian salary would not necessarily have much longer payback period – it would depend on the differential between their pre- and post-MBA salary. The higher the pre-MBA salary the longer the payback period.
Personalised payback periods can be calculated on a school-by-school basis on TopMBA.com/Scorecard, using the ROI calculator which draws on the latest reported school average salary figures, the latest course fees and adjusts based on an applicant’s target industry, geography and pre-MBA salary.
source:QS Top MBA: world’s top business schools and best MBA programs
MBA Finance: Frequently Asked Questions about the important aspects of MBA salaries and financing your business school course.
mba finance
What is the current payback period for MBAs graduating from US and European business schools?
Even though course fees have risen in recent years, from top business schools, salaries and bonuses have also risen and the payback period has actually reduced slightly over the last five years.
MBA salaries for graduates from international programmes have increased significantly over the last two years, and this has continued in 2007. Average MBA salaries graduating from a top US business school like Tuck, Chicago, Wharton and Stanford averaged $110,000 last year, compared with an average of $93,500 amongst MBA recruiters in the USA and Europe, and an average of $71,500 amongst recruiters in Asia. To calculate true earnings one should also take into account a “sign-on” bonus offered by many MBA recruiters, and the potential to earn a further $15,000 during a summer internship.
Against this, to estimate the ‘true cost’ to complete an MBA, we should take into consideration tuition costs, living, travel and book costs. We assume annual living costs and book costs of $23,000 per annum and apply a weighting depending on whether the location is rural, suburban or metropolitan. In addition the opportunity cost of salary foregone, must be included in the calculation and a typical tuition cost of approximately $40,000 per annum.
Using these assumptions, for someone with a pre-MBA salary of $50,000 and joining an average recruiter in the US or Europe, a two year MBA taken at a top US business school would have a payback period of approximately three years. Using the same assumptions, for a one-year European MBA the typical payback period is approximately two and a half years. Someone returning to an average Asian salary would not necessarily have much longer payback period – it would depend on the differential between their pre- and post-MBA salary. The higher the pre-MBA salary the longer the payback period.
Personalised payback periods can be calculated on a school-by-school basis on TopMBA.com/Scorecard, using the ROI calculator which draws on the latest reported school average salary figures, the latest course fees and adjusts based on an applicant’s target industry, geography and pre-MBA salary.
source:QS Top MBA: world’s top business schools and best MBA programs