Executives who are contemplating whether or not to go back to business school should assess the cost of an EMBA before they go through the daunting and sometimes frustrating application process. What goes into assessing the cost of a Master of Business Administration degree goes beyond just looking into the cost of tuition with top programs. The best executives will also look into how much more they will earn with their EMBA and ultimately how long it will take for these increased earnings to pay off the cost of returning to school.
See our ranking of the Top 30 Best Executive MBA Online Programs.
Direct Costs and Opportunity Costs Associated with Earning an EMBA
Going to school can cost a fortune, especially when studying graduate-level business coursework. The higher students climb the academic ladder, the more expensive programs tend to get. While the price tag that an EMBA degree carries is often intimidating enough, that's not the only cost to consider. There are direct costs, but there are also indirect opportunity costs that add up.
Executives who have taken the plunge are more than likely familiar with the term opportunity cost. In economics, the opportunity cost is easily defined as the profit or value that an individual will have to give up or delay achieve something else. In this case, an EMBA student would be earning their EMBA degree at the cost of delaying their career, losing time with family, postponing promotions, and more. These are losses someone can't put an exact dollar amount on but they should always be considered.
The Average Cost of EMBA Programs
Prospective EMBA's can start to assess the value of their degree by looking at averages. It's not a sure-fire way to calculate the time it will take to earn back the money a student spends on business school, but it's a good start. According to Poets and Quants for Executives, the cost of an EMBA has never been higher. In fact, the number of programs that cost above $100,000 has nearly doubled to 40 in the last seven years. Others are close to six-figure after an 11 to 17 percent program fee and tuition hike.
How Much More Do EMBAs Earn?
There are a lot of benefits students enjoy by studying for an Executive MBA, but one of the main reasons that most executives even choose to spend 12 to 24 months covering rigorous curriculum is because they will inevitably earn more with their degree. How much more an EMBA will earn over an executive with only their Bachelor's depends on the region, the industry, and the economic climate.
EMBA degrees can certainly pay for themselves considering the fact that graduates often receive a bonus upon graduation or a promotion to a higher-paying role. According to The Huffington Post, there's a huge jump in average income when those being surveyed have an EMBA. The average income reported is $164,845, which is $65,000 more than others who don't possess their MBA.
What many prospective students don't consider is that many corporations will actually reimburse EMBA students for some or all of their schooling. If this is a benefit offered, it reduces the time it takes to repay school loan debt. Students who are really serious about paying off the cost of an EMBA could earn back those expenses in 2 years or less with the right promotion.