Pursuing an MBA is expensive especially if you want to do an MBA from a top business school. Peter Drucker said, “Knowledge has power. It controls access to opportunity and advancement.” Perhaps this is why people want to pursue an MBA despite the high cost of attendance.
People often see getting an MBA as an investment in their future, so it’s not surprising that students pay tens of thousands of dollars for the chance.
Business schools can be thought of as a pipeline that connects people who want to be managers, marketers, or executives with companies that want to hire the best graduates.
The cost of an MBA can vary, but for a two-year program, the average tuition is more than $80,000. If you go to a top business school, you can expect to pay up to or more than $100,000 in tuition and fees.
Even though it’s expensive, an MBA works for people because it’s a recognized program, increases earning potential, gets more networking opportunities, can start their own business, and can learn about and choose specializations that help them achieve their career goals.
Cost of MBA at top business schools
Here’s how much it costs to attend a top business school.
|S.No.||Business School||2022 Tuition||2021 Tuition||2020 Tuition||2019 Tuition|
|3||Columbia Business School||$80,542||$77,376||$77,376||$77,376|
|11||UC Berkeley Haas||$76,187||$71,817||$68,444||$64,652|
|13||Harvard Business School||$73,440||$73,440||$73,440||$73,440|
|23||UT Austin McCombs||$58,720||$58,270||$56,572||$54,924|
|S No||School||2022 Living Expenses||2021 Living Expenses||2020 Living Expenses||2019 Living Expenses|
|2||Harvard Business School||$31,390||$30,270||$30,700||$29,844|
|9||Columbia Business School||$24,822||$24,822||$24,822||$21,375|
|19||UT Austin McCombs||$20,206||$19,478||$18,078||$18,370|
Total cost of attending a business school
|S No||Business School||2022 Total Cost||2021 Total Cost||2020 Total Cost||2019 Total Cost||2018 Total Cost|
|3||Columbia Business School||$122,460||$118,777||$117,633||$114,309||$110,978|
|11||Harvard Business School||$112,764||$111,542||$111,818||$110,740||$109,124|
|23||UT Austin McCombs||$81,128||$80,324||$77,190||$77,644||$77,644|
Other MBA expenses
Of course, students don’t just spend their hard-earned money on the MBA program. There are other costs as well.
Before the MBA program starts, there will be some costs, such as taking the TOEFL (originally known as the Test of English as a Foreign Language). The TOEFL is a standard test that measures a person’s English skills to see if they are good enough to go to college or graduate school in an English-speaking country.
The TOEFL cost varies from country to country and is about $190 in India and $235 in the US, but there may be other fees, like $40 for late registration, $60 for rescheduling an appointment, and $20 for canceled score reinstatement
Whether or not you need to take the TOEFL, everyone will have to take the GMAT (or GRE), which tests higher-order reasoning skills. These skills include making complex decisions, critical thinking, analysis, and problem-solving. The GMAT test costs $275 (test center) and $300 (at home) everywhere in the world.
Business schools make a lot of money from application fees. Applicants can expect to pay between $100 and $275 per application to each business school.
People say that top MBA programs like Harvard and Stanford get between 8,000 and 10,000 applications each year for about 1,800 spots. The application fee for Stanford Graduate School of Business is $275, which is for most of the top US business schools. This means that if more than 8,000 people apply, the school could make more than $2.2 million.
How to make your MBA pocket friendly?
Obtaining an MBA might be a challenge because of the high prices involved. In addition, the rising cost of living around the world, including gas and housing, makes it harder than ever to pay for an MBA.
The high cost of living has had a big effect on business schools: The top 20 MBA schools ranked by the Financial Times have raised their tuition by 6.3% for 2021.
Here are a few tips to help you reduce your MBA costs:
Carefully select the location of your business school
The cost of an MBA will depend a lot on where in the world you decide to study for it.
The United States is the most expensive nation to pursue an MBA full-time due to the high cost of living, mandatory healthcare payments, and the normal two-year duration of the program. Costs are even higher for international students who have to pay for travel on top of all their other costs.
US MBA programs are expensive, but there are ways to lower the cost. Selecting a cost-effective study region is one example. Living expenses for a Stanford MBA student are estimated at $72,396 for the whole two years, making California one of the most costly locations in the US to earn an MBA.
Cities like New York also have high costs of living, but there are cheaper places to study for an MBA program if you know where to look. Duke Fuqua students in Durham, North Carolina, have the lowest living expenditures of any top 20 MBA school in the US. In-state students usually pay less for tuition, so if you’re a US student, getting your MBA in your home state will probably save you some money.
Choose a shorter MBA to save money
One way to lower the cost of an MBA is to take a 12-month MBA degree. Most top MBAs take less time to finish outside of the US. MBAs that take one year are much cheaper than those that take two. However, even for one year, living in big cities like London and Paris can be very expensive.
If you look outside of the big cities in Europe, you can find top MBA schools with low fees. Warwick Business School, a prominent UK business school outside London, with lower accommodation, food, and drink costs.
Examine the fee structure to determine what is required and what is optional to lower the cost of an MBA. Some trips or sessions may be optional, for instance.
Find out how to get grants and scholarships
Top business schools provide scholarships and grants that can cover a large portion of the MBA tuition. Some of the best MBA schools pay for all of their students’ tuition costs. About half of Harvard Business School students get help based on how much money they need, and INSEAD offers more than 90 scholarships.
There are four different kinds of MBA scholarships: merit-based, need-based, diversity-based, and career-specific. Your best chance of cutting fees is to explore all scholarship programs at your target business schools.
Once you’ve done all your research, the sooner you apply for an MBA scholarship, the better your chances of getting one because business schools have a lot of scholarship budget available.
Cut personal expenses
Lastly, to cut the cost of your MBA, find ways to spend less on your personal life while you’re in school.
First of all, if you want to live far away from home or abroad for your MBA college, look for and book your b school accommodation early. Affordable housing near campus is in high demand because living costs are one of the main MBA expenses.
You could also live a little farther from campus or share a house or apartment with someone else in your MBA class to save money. Even though you may have to spend more on transportation, you may save money on lodging if you choose a location distant from the business school.
Buying used textbooks and other educational resources is another way to lessen the financial burden of pursuing an MBA degree. When you’re getting ready for business school, try not to buy anything brand-new. Look for used bookstores near you that sell books on business, management, and finance, as well as groups where former students or graduates sell their old textbooks.
If you need to upgrade your computer or laptop before starting management studies, buying pre-owned is smart.
Before pursuing an MBA keep in mind the ROI
With the high price tag of an MBA degree, any savings you may make are welcome. It can make things easier financially after graduation.
An MBA from a prestigious institution may cost a lot of money, especially if you want to go to a good school, but it will pay for itself many times over in improved compensation and career opportunities. So while it may seem like you’re spending a lot of money on management education at university, focus on the returns you’ll get after graduation.