MBA: Is it worth it?

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MBA: Is it worth it?

Brian Edwards
Canton, GA · Member since 2018 · 16 posts · 3 votes

Hello all,

My name is Brian Edwards. I am new to the forums but have been listening to the Biggerpockets podcast for about 3 years now. I will be graduating from the University of Georgia next month and have been trying to look ahead for the next 3-5 years.

Since I began listening to Biggerpockets, I have definitely caught the bug for REI. To prepare, I have been saving as much as possible from work and internships over the summer. I will be in a solid position to start house hacking (2 to 4 unit smaller multifamily) sometime next year.

However, I am running into a dilemma. Should I consider holding off on REI, building upon my nest egg for 2 more years, and go back to school in about 2 years for my MBA? Luckily, I will graduate undergrad with no debt. Additionally, the program I am considering costs ~$70,000. However, I would likely be able to get a graduate assistantship stipend that would lower that basis.

If I were to complete this program, the average salary is $120,000 with an average signing bonus of ~$20,000. Currently, I should have a starting salary of around $60,000 straight out of undergrad.

I realize this is a subjective question and there are many factors to consider given the timeframe. I figured this could be a good discussion topic as I am sure many others have considered an MBA at one point or another. Any and all advice is welcome!

Best regards,


Brian Edwards

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Ola Dantis
Multifamily Syndicator · Houston, TX · Member since 2016 · 1k+ posts · 2k+ votes
6y

@Brian Edwards Hey Brain, 

I was in your shoes about 5 years ago. I was prepping for the GMAT and visited Harvard and Wharton for their MBA programs.

Realistically, the MBA does carry some weight if you go to a top Ivy League as the network and friends you get are priceless, honestly. Remember, those same friends could potentially be your Passive Investors in your Real Estate deals in the future. Anyone who tells you otherwise hasn't been around long enough. 

Now, getting your MBA from a pretty standard university might not be the best bang for your buck to be honest if you are already considering REI and you have no debt.

This is a tough one and you definitely need to do some critical thinking + soul searching. 

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  • Brian Edwards
    OP
    Canton, GA · Member since 2018 · 16 posts · 3 votes
    6y
    Originally posted by @Account Closed:

    I have an MBA and my recommendation to you would be to work for a company that offers assistance in getting an MBA.  The company I worked for provided I think half of my tuition once I completed the semester, so half of my tuition was covered.  Some companies do offer more.  The catch is that you usually have to work for the company for a certain amount of years after you get your degree (I think two years is the norm).  So while you would get a discount, or even potentially get it for free, you would be tied up for some period of time after graduation.  

    Do you plan on starting your real estate investing right after college without working?  Or do you plan on working for a company in conjunction with starting your real estate investing?  If you plan on working, I would try and do a part time program at night, which most schools seem to have one now.  This will allow to work a corporate job, get your MBA, and get a discount on getting your MBA.  

    Also, there is no guarantee you will be six figures after graduating your MBA with no work experience.  An MBA is most beneficial with some work experience, usually 2-5 years of work experience.  I graduated with my MBA in 2014 and unfortunately could only find a job with a company that didn't really care if I had an MBA or not.  So I didn't get any pay increase because of it.  An MBA should help you move up the corporate ranks quicker than most people, but unless your going to a top 10 MBA, I don't see a six figure salary upon graduation.

    Brian,

    I have heard that most companies require you to work at least 2 years for them post-MBA if they sponsor it. I plan to work right out of college and start investing on the side. I believe house hacking could be a great starting point. That is a great insight. I would definitely work for at least 3 years before pursuing an MBA. I really appreciate your help and advice!

    Best,

    Brian Edwards

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  • John McCurley
    Dallas, TX · Member since 2019 · 10 posts · 1 vote
    6y

    @Brian Edwards

    I don’t have my MBA but three of my coworkers do. We all got hired for the same job and exact same pay. Difference is I do not have any debt from an expensive MBA program.

    MBA’s are only useful if you have two things: years of experience in a corporate setting and an MBA from a top rated school.

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  • Greg Schuricht
    Accountant · Minneapolis, MN · Member since 2018 · 81 posts · 21 votes
    6y

    @Brian Edwards

    If you leverage the network you develope over the course of the program it can be a worthwhile investment. In my experience that is the only thing that makes a graduate degree worth it. I got a master's degree in finance from a top 20 business school but didn't take the time to make meaningful connections with my fellow students. Ultimately it proved to be a waste of time and money

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  • Brian Garlington
    Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
    6y

    I thought it stood for Multifamily Buying and Acquisitions

    1Reply
  • Kristin R.
    Realtor · San Diego, CA · Member since 2019 · 22 posts · 21 votes
    6y

    @Brian Edwards

    Lots of really good advice here especially in regards to waiting a little while so you have the work experience to add in.

    I would definitely recommend taking the GMAT before you graduate though. It’s good for 5 years, so you can wait to apply to grad school but also don’t have to stress about brushing up on your math skills if/when you decide to go back.

    Good luck!

    1Reply
  • Taylor L.
    Rental Property Investor · RVA · Member since 2016 · 5k+ posts · 4k+ votes
    6y

    Personally, I decided no. I was already making decent money and the cost is enormous. Both direct and opportunity cost. A MBA education largely won't prepare you to invest in real estate, in my opinion. You can spend a lot less money and learn directly from people who have accomplished what you want to accomplish in real estate.

    1Reply
  • Ian WalshBusiness Member
    Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
    6y

    If the MBA specifically has a reason for you to get it so you make more money in a real estate path in the future, then sure.  I can say that the majority of investors I know do not have an MBA.  That's just my experience.

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  • Craig CurelopBusiness Member
    Real Estate Agent · Post Falls, ID · Member since 2016 · 1k+ posts · 1k+ votes
    6y

    @Brian Edwards - An MBA makes you more employable. You delay your journey to financial independence by 2 years, $70,000, and a few gray hairs just to make yourself better for working for someone else. This is my suggestion when it comes to any sort of post-secondary education. 

    IF one of your life goals is to become a CEO of a Fortune 500 company, a doctor, or a lawyer where you likely need some sort of formal education, go do it! If you are getting an MBA JUST to make more money, then don't. 

    I would be willing to bet that if you put in the same amount of work working on a real estate business as you would an MBA, you would make far more than $70,000 in two years. My two cents. 

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  • Peter Baudendistel
    Rental Property Investor · Knoxville, TN · Member since 2018 · 36 posts · 36 votes
    6y

    @Brian Edwards

    I personally went the route of working for a few years (engineering), getting some experience, and then pushing my employer to support my furthering of education. I didnt get a degree from Wharton, but it's still accredited and 100% covered by my boss. That ROI was infinite.

    The question I've got for you is this: what do you plan on doing with it? You going to work for someone else that values a top tier name MBA for the rest of your life, or work for yourself and only spend for what you need to be successful? For me, I just wanted the education, I didn't need the name brand.

    Ultimately, if you frame your decision through your end goal, the answer should be a little more clear for you! Begin with the end in mind!

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  • Sean McCluskey
    Rental Property Investor · Newport Beach, CA · Member since 2017 · 218 posts · 138 votes
    6y

    @Brian Edwards I am glad the forum was supportive about this for once (people here are typically willing to advise dropping out of undergrad! Ugh!).

    I have a top 5 MBA and I agree completely with the comments that top 30 is a good investment.

    Go on the career services website for the schools you’re interested in and get the employer data, average salaries, etc, but MOST IMPORTANTLY: what percent of the class already has an offer before graduation? That’s the sign of the MBA being in demand from employers.

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  • Danielle Wolter
    Rental Property Investor · San Diego, CA · Member since 2019 · 290 posts · 253 votes
    6y

    @Brian Edwards It really depends on what your goals are. I started my MBA (not a top30) 4 years after my undergraduate. My employer footed the entire bill, with the stipulation that I work there for at least 2 years after graduating. I have since moved on from that job and am currently CFO for a small company. I believe the MBA helped me get here (along with a lot of hard work of course). It also gave me a great well rounded education that I believe will help any business owner. My undergrad was in accounting, but the MBA gave me a broader knowledge of business, which i believe also helps me run my personal business on the side. So I think it can be very helpful, but it really depends what you plan on doing with it. 

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