Is there a wrong way to get an MBA? I don’t remember reading any negatives in the program pamphlet or hearing anyone say they regretted continuing their education? Aren’t advanced degrees supposed to open the door to new opportunities and a higher salary? How did you screw this up Mr. AE?
The Wrong way to get an MBA
My MBA Story
I completed my undergrad degree in 2009, which was
not a great a terrible time to enter the workforce. Particularly with a degree in Construction Management. Employers were more likely to lay someone off than hire a recent college grad. I had one job offer and I was not interested in doing manual labor for a few years after graduation before actually getting to “use” my degree.
So there I was, one week before graduation, $65,000 in debt, sitting in my rented college house that had multiple beer pong tables, trying to decide what to do next.
I had two big factors weighing on my mind.
I might be one of the only people that can say love weighed into my decision to pursue a masters degree. Mrs. AE was 2 years behind me in school and we had already been dating for a few years. We were pretty confident we were going to get married one day (That worked out!).
If I wasn’t going to keep going to school, I was going to move 3.5 hours away from her to save money (parents house). We had spent one summer apart already and I didn’t want to go through that again.
Lack of Intriguing Job Offers
Partially self-inflicted and compounded by the job market, I didn’t have any hot job prospects. I could have done more networking while attending school, but it was too late to change that. My only realistic opportunity was to work for a concrete restoration company doing manual labor the majority of the time. I didn’t go to school to jackhammer concrete off the side of a coal silo 250′ in the air for 2 years.
I did jackhammer concrete for a summer on a 6 x 2.5-foot platform 250′ off the ground the year before graduation. Not being a fan of heights, having the wind would routinely blow us 5′ away from the side of the building scared the crap out of me. Basically white knuckling the railing for 8 hours a day. Never again!
Since I had been accepted to grad school, didn’t want to leave Mrs. AE in another state and was too good to work manual labor I decided to go straight back to school full-time.
BONUS! I got to defer paying my loans back because I was a full-time student. Let that interest accumulate.
Let’s look through the mistakes I made and the opportunities I missed out on by going straight back to school full time.
Let your employer foot the bill
What’s better than completing an advanced degree? Completing it for FREE!
My graduate degree cost another $20K (before student loan interest charges!) that I could have passed on to my employer with little effort today.
Even if it takes awhile longer due to your employers yearly reimbursement restrictions, wait it out and have them pay for as much as possible. The only reason I would expedite and pay out of pocket is if you know future earnings will trump costs in a short time frame.
If you employer offers tuition reimbursement, find a way to use it every year. If you don’t want to commit to getting a complete degree, there are a ton of certifications, “mini” Graduate Degrees or just general skill classes (excel, project management, etc) you can take.
Don’t have a college nearby? No problem, you are using the internets to read this sentence and can go to class online too!
Earn while you Learn
On top of stacking on $20,000 of student loan debt, I was not earning any money why getting my advanced degree. Therefore I was not paying off any of my existing debt and student loans from your undergrad don’t stop accumulating interest just because you decide to keep going to school. The equation was not working in my favor:
The equation was not working in my favor:
No/Limited income to pay down debt + Debt Accumulation + Capitalized Interest = Big Problem Later
That big problem has been a thorn in our side for the last 5 years. It is definitely, 100% without a doubt, the biggest financial mistake I have made.
Last but not least, an advanced degree should be leveraged to earn more or open a new career path. Since I had ZERO real world experience, I wasn’t able to use my MBA to negotiate a higher salary. It may have helped me into the door for an interview, but outside of that, I was just another college kid begging for a job in a tough economy.
Some jobs offer a guaranteed salary increase once you complete advanced degrees, others you will need to use a combination of experience and negotiation to increase your income. Start the salary conversations early if you want to leverage your degree after completion.
If you are interested in a new career path, make sure you meet with recruiters or hiring managers so you know what education background they are looking for.
Hopefully, I can leverage my MBA when I switch jobs at some point now that I have over 5 years of experience, and cash in. Would be nice to get some dividends on that $20,000.
What I did “Right”
I did do a few things right
- Completed in 1.5 years – Since I wasn’t working I was able to treat my MBA like a full-time job and completed it in 3 semesters. Doing so saved a bit of money as I didn’t have to pay for anything over “full-time” credits.
- Participation – I got more out of participating in group projects, discussions and networking with older MBA pursuants that had real world experience than most of the lectures. It’s not a huge part of the curriculum but don’t overlook the value of you classmates.
- 3.6 GPA – Not a huge deal, but it’s nice to see that I wasn’t a slacker when I list it on a resume
Do I regret getting my degree?
The jury is still out, if I am able to leverage my education down the line I would still say it is a success. If I don’t, I still got an extra 1.5 years of college life with my future wife and I actually enjoyed most of the classes. I will probably feel better about it once my student loans are safely in the rear-view mirror sometime next year.
If you are thinking about pursuing a Graduate Degree remember these 3 things:
- Get your employer to pay
- Earn while you learn
- Leverage that new knowledge into some more cash or a new opportunity
Do you have a graduate degree? Were you able to leverage it into a new opportunity or higher salary? What do you think of my 3 recommendations for someone thinking about pursuing higher education?