As an MBA holder from UC Berkeley, I should be very pro-business school. But after seeing the latest tuition figures compiled by US News & World Report, I cannot in good conscience recommend getting an MBA full-time today if you are paying full price.

Only if you are already rich, screwed up massively in college, want to take a long vacation (and rich), or despise your job and want a career change should you consider an MBA.

Take a look at the details yourself.

The first thing that stands out clearly is how wrong the rankings are. UC Berkeley Haas should be #1 since the school is located in the booming SF Bay Area and has the “cheapest” tuition. But besides the egregious rankings, the second most eye-opening part in this chart is the tuition.

Who in their right mind spends more than $65,000 a year on tuition alone?! Once you add food and shelter, we’re easily talking $100,000+ a year. Students are not only giving up two years of experience, but they’re also giving up another $150,000 – $300,000 in median lost income.

Yes, getting an MBA full-time is like taking a long work vacation for many people. But unless you are already rich, or are willing to work for decades after graduating, I’d much rather have the $300,000 – $450,000 in paid tuition and lost wages instead. Taking 4-6 weeks off a year in my late 20s and early 30s was good enough for me. How about you?

Some of you might think that given the MBA is a graduate degree, many schools provide grants to attract the highest caliber of people. Unfortunately, MBA programs are not like graduate programs in the sciences or humanities, where scholarships are readily available. MBA programs are businesses that seldom give out free money to students.

The Better MBA Solution: Get Your Employer To Pay

When I went to Berkeley Haas between 2003 – 2006, tuition was around $28,000 a year. I felt that was a steep price to pay back then as well. As a result, I applied to the part-time program because my employer was willing to pay 100% of the tuition if I stayed on for at least two years after graduating.

The program took me three years to complete. Every Saturday for nine months a year, I would go to class from 8:30am – 5pm and then spend another 10 hours a week doing homework and group projects. The first year was brutal due to the adjustment and all the core classes I had to take. But by the second year, the program was a lot of fun due to the electives I selected.

I could have finished the program in 2.5 years if I took two summers of classes, but I needed a break. I was regularly working 60+ hours a week in finance and was doing a lot of traveling.

Although the three years were tough, they went by quick. I worked for six more years before I finally left my employer in 2012. It was a good trade for both parties.

If you are considering getting an MBA, please first check with your employer to see if they have a tuition reimbursement program. It’s a business expense for them as well as a recruiting and retaining tool for their top employees.

If you plan on paying the entire bill yourself, then do research on how you can deduct the tuition of an MBA on your taxes. For example, if you earn under $80,000 the year you go to school or $160,000 if you are married, you can deduct all tuition and school-related fees. See more tuition deduction info from the IRS here and check with an accountant.

The Main Things I Learned From My MBA

Here are some of the things I learned in business school:

* How to create an income, balance sheet, and cash flow statement

* How to be a better negotiator

* How to be a better communicator

* How to properly analyze real estate transactions

* How to lead more effectively

* How to play nice with eager beavers

But the main thing I learned in business school was confidence. The more information I knew, the more confident I became. With an added diploma and three more years of work experience, I started to finally feel like I belonged in the finance world.

The problem with MBA programs right now is demand. Applications were down 5% – 10% for the top 25 schools last year and will likely decline even further this year once the data comes out.

The schools blame the decline of international applicants scared off by anti-immigration talk in the US, hurricanes in Texas, and white supremacist protests in Virginia for their declining demand.

But one variable they do not discuss is the extraordinary cost of tuition, which is just too obvious to me and any rational person working in a strong economy today. If business schools want to increase demand, they simply must lower price. You don’t have to go to business school to understand this concept!

Check out this chart highlighting the year-over-year change in MBA applications.

Getting A Graduate Degree Is Contrary To FIRE

If your goal is to retire early, then getting a graduate degree doesn’t make sense unless you can go part-time or get your graduate degree in your early 20s.

The goal of FIRE is to break free from the grind as young as comfortably possible. By spending 1 – 4 years in graduate school, you are sacrificing precious time and money in order to hopefully leverage your degree for as long as possible.

Originally, I had thought that once I got my MBA at 29, I would work full-time until age 40. But I couldn’t take six more years of indentured servitude so I engineered my layoff at age 34. Not all was lost though as my MBA gave me some tools to figure out how to make money with my own two hands.

The only person I know who had a lower return on their MBA than me is a friend who went to Harvard Business School full-time. When she graduated at 29, she proudly told me, “I never plan to stop working Sam!”

But after she had a baby girl three years later, she never went back to work. Despite only working one year longer than the time she went to school, she met her husband in business school, who ended up making multiple millions at a hardware device startup. They live in a $4M+ house and life is good, so perhaps her return was stellar after all.

Still No MBA Regrets

Despite the ridiculously high cost of getting an MBA, you will likely not regret going. You’ll meet a lot of interesting people, go on amazing school trips, and be forever part of a fraternity that will always believe their MBA was worth it.

Just make sure you either work for at least 10 years after graduating or make at least 10X the total cost of getting an MBA before you stop working, whichever comes first. After all, getting an MBA is all about maxing your return on investment.

Further, an MBA is a great way to reset your career if you screwed up in high school or slacked off in college or work at a terrible job you absolutely hate. If this is the case, go for it and figure out how to deduct the cost on your taxes.

As for me, of course I don’t regret getting my MBA because it was largely free. It was painful to be working 80 hours a week for three years, but once I was done, working only 60 hours a week felt like a breeze. Hard work should never be an excuse for regret.

Staying in San Francisco for more than 12 years after graduating has proven to be a wise decision given a Berkeley MBA carries more weight here than in other parts of the country.

Finally, now that you know I got an MBA from Berkeley, doesn’t it seem like you’re getting even better value for what you’re reading on Financial Samurai? If not, I’ll gladly give you your money back. Go Bears!

Related:

Would You Accept $1,000,000 To Go To Public School Are Your Life?

Is An MBA A Big Waste Of Time And Money?

Readers, do you think getting an MBA is still worth it today? What types of people are willing to pay so much to get an MBA nowadays? Do you know anybody who went to graduate school and ended up becoming a stay at home parent or retiring shortly after?

Note: Some people really dislike folks with MBAs, especially those who didn’t get an MBA. There’s also tension sometimes between the engineer “creators” and the business development, sales, and marketing types (MBAs). The reality is, you need all types of people to make a business run well. Know the culture of the firm you want to work for before getting an MBA or applying to that firm. 

When I was applying to colleges in 1994, I thought only extremely smart or talented people attended Harvard. I had heard stories about the rich buying their kids’ ways into Harvard, but I was unaware of the details.

As a public school kid with an OK SAT score, a 3.6 GPA, and unspectacular extracurricular activities (tennis team captain vs. eradicating malaria in a small village in West Africa), I decided to save myself hundreds of dollars in application fees and apply to mostly local state schools like UVA, Mary Washington, and William & Mary instead. Paying less than $3,000 a year in in-state tuition even back then felt like a steal.

After graduating from William & Mary, I got a job in the international equities department at Goldman Sachs in NYC. That’s where I got to interview hundreds of Ivy League and other elite private institution graduates as part of Goldman’s consensus-driven interview process where even grunts get to interview candidates.

We ended up rejecting over 95% of the candidates due to poor fit. It wasn’t that they were not smart, because they were. We only wanted people we could sit next to for 12-14 hours a day. It obviously helped if they had an international background, spoke multiple languages, and had a passion for equities. But we were mostly looking for great teammates.

Rejecting the majority of elite private college graduates made me realize they are no different from you and me. For the next 13 years, I’d compete with these folks on the ruthless battlegrounds of finance and smash them to bits most of the time because of my hunger. Coming from a non-target public school background with middle-class parents, I wasn’t going to squander my opportunity for financial independence.

Today, I am a small business owner with business owning friends. Recently, some of us have noted a growing negativity towards alumni of elite private schools. This is a problem (or a solution) for parents who plan to spend lots of money starting in grade school in the hopes their kid will attend a school like Harvard. This is also a potential problem for private university alumni who might unfairly be judged by the masses.

If you are one of these alumni, don’t be upset about the trend against the 1%. Instead, read with an open mind and pay attention as your future or your kids’ future might depend on it.

This article will address:

1) Why there is a growing negative perception about private university graduates

2) What we’ve learned from the Harvard / Asian-American discrimination lawsuit

3) What you can do to fight back against the negative perception

Knowledge brings about wealth and power. If this wasn’t the case, you wouldn’t have families spending $20,000+ a year for their children to attend kindergarten through the 12th grade. If knowledge wasn’t so important, there wouldn’t be any private tutoring or a test prep industry. If education was no big thing, there wouldn’t be a tremendous amount of pressure for kids to go to the best universities that cost even more.

The very fact that people spend so much time and money learning is the main reason why I love to write about personal finance. Achieving financial freedom while doing something purposeful along the way is often the end game for those who focus on education. Yet, not everybody has the money, time, or connections to get the best education possible. Therefore, to be able to democratize access to knowledge is quite fulfilling.

If you learn nothing else from Financial Samurai about the stock market, real estate investing, asset allocation, early retirement, entrepreneurship, tax minimization, behavioral economics, or debt management, at least come away motivated to improve your finances based on the target income and net worth charts I’ve created.

Given Financial Samurai gets roughly 1 million organic pageviews a month, I’m able to test new hypotheses that may help different types of people in various situations. The latest problem I want to tackle is figuring out an inexpensive, easy way to fix the financial crisis in America. I’m thinking simple policy changes that will strengthen our country for generations to come.

Hypothesis: Those who read more about personal finance topics tend to earn more, be wealthier, and lead happier lives than those who do not.

To test this hypothesis we will first compare overall American income and wealth numbers by race with the income and wealth numbers of American personal finance readers.

We will then see if the racial makeup of American personal finance readers reflects the racial makeup of the overall population. Finally, we’ll then assess whether an overrepresentation by one race correlates with higher income and wealth and vice versa.

Key Assumptions:

* More education is better than less eduction.

* More reading is better than less reading.

* Access to the internet is available, low cost or free.

* Intelligence across races/ethnicities is more or less equal if you control for environment

* The larger the sample set, the more significant the data.