ROI (Return on Investment).  If you don’t know what ROI stands for, you will surely know by the end of your MBA program along with a dozen other financial ratios.  I am not trying to wow you with my newly acquired knowledge, but ROI’s have been in the news lately in regards to the rising cost of tuition and whether you will get a return on your investment of tuition dollars.  With tuition costs for some MBA’s being more than $100,000, it might be prudent to consider whether you will make more than enough after graduating  to make it financially beneficial and personally rewarding for your time , effort,  and exam stress.

A classmate forwarded me a Wall Street Journal which included an interactive ROI calculator for various executive MBA courses.  What caught me by surprise was that it wasn’t the ivy league programs at the top of the list for ROI’s.  What does this mean?  Well, it means that you don’t always get what you pay for and just because you paid over $100,000 in tuition doesn’t necessarily mean that you will get a better return on your money. 

The WSJ article also had a cool interactive application that calculated your projected return on investment for about 30 schools including Thunderbird where I am currently attending their Global MBA program via on-demand.  It projected a 63% ROI for me based on the input.  If your school is not one of the ones listed in the article, you can still do the calculation.  Do some research as far as what job you think you can get upon obtaining an MBA.  I work for a large company so the salary information and realistic promotion that I would get is pretty easy to obtain the information.  You can also contact the career services of the school you are thinking of enrolling for this information.  For me it would probably be a promotion and a 15-20% pay raise.  Externally, I presume that it would be 20-25% or higher.  For the next four years assume a 5% annual raise.  Add the amount of extra income (x) and subtract the cost of tuition (y) and divide that number the cost of tuition ((x-y)/y).  (Excuse me if I just brought back horrors of Algebra.)  Now compare this to another investment, say the stock market…  Now, where would you rather spend your money?