If you’re asking yourself: Should I go to public or private university, you are on the right track. Too many parents and students don’t think this choice through until it is too late.

Going to university today does not guarantee you gainful employment. If you cannot afford university, let alone private university, what you will be guaranteed is student loan debt. Yes, Joe Biden and other Democrats want to cancel up to $50,000 in student loan debt. But you can’t depend on government handouts forever.

If you go to an expensive private university, there’s a good chance you will end up doing what a public university graduate is doing. You may even go to Harvard and end up becoming a nobody! Please think through your university choice carefully.

Fears Of Going To An Expensive Private University

My parents were middle-class government employees. They were certainly not rich with their 10-year old Toyota Camry and our small townhouse. Here were some questions I had when asking whether I should go public or private:

“What if I graduate from private school and have to live at home with my parents because I can’t find a job?”

“What if I graduate from private school and end up back at McDonald’s?”

“What if I graduate from private school and end up getting the same job with the same pay as my public school friends?”

“What if I bleed my parents dry to the point they have to work many more years to afford retirement?”

“What if I drop out of private school halfway through, thereby wasting all that time and money?”

Not only were my parents not rich, I wasn’t smart enough to get large amounts of scholarship money from private schools. Therefore, I felt extra pressure to make the right choice.

The More Fear And Guilt You Have

My thesis is that the more fearful you are of failure and the more guilt you feel about spending money, the more you should consider going to public school.

If you are unaware that 870 million people in the world suffer from malnourishment every day, then what do you really care about wasting food on your plate or gorging yourself to oblivion?

If you know your wealthy parents will hook you up with a job at their company after graduation, does it really matter you spend $78,000 in tuition going to Boston University like AOC when U. Mass-Amherst costs $15,000 in tuition and provides just as good an education? Of course not.

In the end I decided there was no way in hell I was going to attend a private school that cost $25,000 a year in tuition back in the 1990s if it wasn’t in the top 10. All subjects are taught off the same text books anyway. Some of the intro courses are even taught by teacher assistants. Why pay a premium?

I was even considering going to community college for two years and then transferring over to a four year institution to save my parents more money. But thankfully William & Mary accepted me despite my average SAT score.

Virginia has some other great public schools including UVA, Virginia Tech, James Madison, and Mary Washington so it didn’t seem right to not take advantage of the public school system.

When I wrote “Average Inheritance By Country,” I was merely guessing at the $3,000 a year tuition my college charged back in 1995. After doing some digging online, it turns out my guesstimate was pretty spot on at $2,890 a year. The reason why I remember the cost 18 years later is because I was extremely sensitive to my family’s finances.

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!

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Related: 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