MBA and Debt - Get comfortable with the idea...

In Getting the MBA Edge - Wharton 2011/12 - Preview Guide, we talk about all the things that are officially and unofficially part of the Wharton MBA student budget. Unfortunately, the student loan covered items can be eclipsed by nickel and dime items, as well as various 'bonus experiences' that can cost several thousands of dollars.

This week Poets and Quants published an article about the record breaking debt that will be incurred by the Wharton MBA Class of 2013.

Here are some examples of things that can drive up the cost from what you see in the brochures:

· MBA Pub dues (generally $120 for the year)

· Various Club dues (up to $500 for the year on the expensive end, or as little as $5)

· Leadership Ventures (VERY EXPENSIVE, up to $8000 depending on your destination)

· Global Immersion Programs (another high $$$ item)

· Recruiting travel for unofficial events (see ‘informational interviews’ in the Career Management section)

· Budget for parties, bars, and group dinners (can be up to $400 a week if you go out a lot)

· Cabs to get around Philadelphia at night (a priority, especially for female students in a big city)

· Vacation travel with clubs (the Japan Trek, Wharton Rugby South Africa tour, etc…)

· Weekend travel for social events (Wharton Ski Trip, Beach Week, etc…)

The interesting part about all of this, is the fact that all of this does indeed put pressure on students at graduation. Not even the most well funded non-profit can offer a salary that offsets rent in a major city combined with $1500 per month student loan payments. This may have the effect of pushing students into jobs that can allow even a decent lifestyle after graduation.

This cash flow punishment on graduates does encourage them to do nothing but work, but people who have families or are trying to start them will be under incredible pressure.

All of this leads to the question - is this degree really REALLY worth it? If you do not know the answer to that question before you start, you might want to reconsider the journey.

In Getting the MBA Edge, we quote one of the songs in Wharton Follies 2008 that said "$150,000 is a small price to pay for a priceless time." You need to decide if you agree with that...