How much is a business degree worth? Do I go to my dream school for an extra $100k?

College Search & Selection
1

Hi cc, thank you to everyone that has helped me along this college process. It’s finally over! Now I need to decide. I applied to 19 schools all in case I didn’t get in my dream school, Michigan Ross, but then I ended up getting into all of them + Ross! So now I am faced with a big financial decision. My family is able to give me $40k a year and I am so so thankful for that, so when I say “debt” that is my own personal debt that I’ll have post-grad. I also was accepted into CMU Tepper and Northeastern D’Amore Mckim but they’re super expensive so I ruled them out but if you have anything to say about those let me know because I still like them.

I love big, spirited schools with great business schools. That basically applies to all of these. I am from NY so OOS for all of these. I think I want to go for entrepreneurship and supply chain; something like that but definitely focusing on the entrepreneurial opportunities of the school. I ranked all the schools in order of favorite to least favorite starting at the top. Also, I toured Michigan, Texas, Minnesota, and UMass, but never saw the others so I’m doing as many online tours as possible.

I included if the school does BBA or BS but I’m not sure how important that is, the ranking, my own personal debt post-grad, the salary I’ll make, and the business undergrad class size, and ratio. I don’t like too big of a class size. Also, don’t want to do greek life and I know UIUC and Indiana are huge into that but idk how big of a factor that should be. I need some guidance lol. I know people are gonna say 100k debt undergrad is unreasonable, but it’s Ross!!!

Michigan Ross - BBA

3 ug business

$104k debt
78,500 median starting salary
Class: 600
Student to faculty: 15:1
PRO: freaking beautiful school. Ross building is unmatched.

Texas McCombs - BBA

5 ug business

$80k debt - i need to figure out how to get instate tuition–a lot of oos buy property then pay IS for 3 years, so this could be lower but with added burden
65,000 median starting salary
Class: 965
Student to faculty: 15:1
PRO: love weather, Austin is a huge start-up city, there’s a lot of activities to do outside

Illinois Gies - BS

9 public ug business, #19 ug business

$64k debt
63,400 average starting salary
Class: 500
Student to faculty: 20:1
CON: #1 greek life

Minnesota Carlson - BS

19 ug business

0 debt
57,000 median starting salary
Class: 600
Student to faculty: 17:1
PRO: no sorority pressure, campus was very nice
CON: so cold, business school is seperate from campus, 80% of grads work in minnesota and i do not want to work in minnesota; basically all connections and speakers are MN companies

Wisconsin Business - BBA

7 public business

$64k debt
58,700 median starting salary
Class: 800
Student to faculty: 17:1

Indiana Kelley - BS

10 ug business

$20k debt
63,000 median starting salary
Class: 1975
Student to faculty: 16:1
CON: sorority culture is big

UMass Isenberg - BS/BBA

31 public business; #50 business overall

0 debt
59,000 median starting salary
Class: 920
Student to faculty: 17:1
PRO: close to home and a drive away, brother will be a senior, #1 college food

2

Ignore the starting salaries that they publish. That’s not relevant to you personally. If you went to Ross you’re not guaranteed a starting salary would be higher than if you went to Wisconsin.

How did you calculate the debt? Don’t forget that tuition, room, and board go UP every year, and the amount of money your parents are giving you will remain constant. So all the increases are on you.

Who’s paying for travel and personal expenses? Is that part of the $40k? Or are they saying that they will devote $40k to the DIRECT-BILLED costs, which are tuition and room & board? You should talk with your parents and get a good understanding of how the finances are going to work before you make your decision.

By the way, Michigan is big on Greek life too.

3

You can only borrow about $27k without a cosigner. Cosigned student loans are generally not a good idea.

If you stay within that debt limit, your choices are:

Minnesota $0 debt
Indiana $20k debt
Massachusetts $0 debt

4

@brantly when the schools sent me financial there was estimated transportation so i just included everything; i did the cost of the tuition + all fees and misc. costs so for example that was $56k total everything for uiuc and wisconsin, so I did 56k*4=224k cost overall minus parent contributions 160 = 64k left over for me to pay. and yea i know they up the price but i didn’t factor that in but these estimates are for the most part accurate.

i have a friend at michigan not in greek life and she had a great time freshman year and said she felt no pressure to rush whereas i have a friend at indiana and he said you basically need to rush, so im kind of just basing it off what my friends say but everyone has diff. experiences so idk. i also want to rush a business frat so ill have that, but not social sorority.

5

@ucbalumnus my family would give me loans if i really needed to. they know i love michigan and they really like ross so after we consider everything and decide ross is worth it they would be willing to help me.

6

OK, well, you’ll have to figure out the logistics of the payments. If your parents pay the school $40k for the direct-billed costs, you have to add to that (assuming Michigan) and then have money in your pocket up front to pay for books, travel, and personal expenses.

And, as @ucbalumnus said, you will need a co-signer. Are your parents willing to co-sign your loans? This is the amount you are permitted to take on yourself without a co-signer:
$5,500 – freshman year
$6,500 – soph year
$7,500 – junior year
$7,500 – senior year

How are you going to get the rest?

7

OK. I just saw this. So your parents would lend you $75k? At what interest rate? Maybe they’d give you good terms.

8

For me, it’s really only between the zero to low debt of Indiana, then UT and Ross, if you’re going to get a big loan.

And Bloomington, Austin and Ann Arbor are all great towns, but Austin is huge.

As you know, my D goes to A2 and is a member of a sorority, but according to the CDS, only 9% and 19% of the men and women, respectively, join Greek life.

9

IMO, IU Kelley is the no-brainer choice.

Kelley offers the same opportunities as Ross. The top students do just as well as the top students at Ross and have access to the same recruiting opportunities. IU is big and spirited as well though being in IN, basketball is the sport they care about most while it’s football at UMich.

10

Do not go into massive debt when the economy is tanking. It may come back, and will come back, but it’s no guarantee. Entire firms that you hope to work in may close. I base this on what happened in 2008. Entire firms closed, big ones, unthinkably big ones, and students who thought their futures were strong graduated with no jobs and lots of debt. I strongly advise going to the school with the least amount of debt.

11

First off congrats to you. I think you should do a web cast on how you got into 19 great school choices and some very top ones indeed. Write a book ?. Maybe your future is right in front of you… Lol…

I see your dilemma truly. You need a serious sit down with your parents. Can they honestly afford giving you in essence around $70,000/year? If so then why the limit they gave you? That’s my first question to them. With the economy the way it is they might be hurting more now then 6 months ago. If they can’t cleanly give you the money without extra loans on their part then this is a non starter for me. I love when “business” students seem to always have this question.

What does your future business self say? Not your current student self say? Spend 10 minutes to analyze this like a class project. The answer is there.

Also schools like Michigan can cost less due to getting off the meal plans, going to apartment living (it is costly to live in Ann Arbor but deals can be found).

As you know… I am a huge Michigan supporter but…

You don’t even need a business school to go into business but you have like only great options. I personally don’t like debt so let’s look at this differently and a win /win for both you and your parents.

What if you went to one of the lower costs schools let’s take Kelly since it’s the best known and ranked of the 3. Would your parents give you the extra $20,000 so you could invest in your future? Remember you just saved them around $20 000. If so then you would have $80, 000 banked! I don’t know but a degree from Kelly and money in the bank just sounds so much more appealing then being in debt $100,000 Even if they gave you $10 000/year that is still $40,000/banked. (BTW they don’t owe you anything. Paying for college and just being your parents is enough ?).

Those are my ideas. Let’s see how good you really are at this business thing… ?.

12

You will not get in state tuition at Texas or any of the other out of state schools. Students and their parents have been jailed for deceitful behavior because of this. so forget about that scheme.

If your parents can lend you $75,000 they are affuent. Why are they not just paying your tuition like most such parents do?

13

My son applied to 11 schools and got
into all, so I know how an over-abundance of choice can produce a level of added stress that is unanticipated. I’m going to give you the boring and practical answer. All of these are great options, but I just wouldn’t take on debt if you don’t have to. I would go to Isenberg or Minnesota, followed by Kelly with minimal debt. Disclaimer—my son is going to Isenberg so I’m biased, but it also seems to check your boxes in terms of not wanting a school where Greek life is a must. Does your brother like UMass? What does he say?

14

Congratulations on your acceptances.

You anticipated that posters would tell you too much debt is not good, and you were right. I agree with the others who have recommended choosing a lower cost option and of those, Kelley is the best. You can get a good education, good internships, and a good job coming out of any of the schools on your list.

I encourage you to limit your debt to the $27K total ug amount. Taking out more than that will hamper your ability to become an entrepreneur…one doesn’t have the same set of choices and/or can’t take the same risks when they have a lot of debt. Period.

Here are some numbers:

$27K in loans at 4.5%: $280/mo payment for 120 months. Total payback amount $42K

$100K: $1,036/mo payment for 120 months. Total payback amount $155K

You would need a high salary, coupled with low living expenses to afford a $1,000/month student loan payment…go ahead and create a projected budget.

Further, if you have a large loan, you would not be in a position to take a small (or no) salary for awhile, so the entrepreneur thing would probably not realistic. (The wildcard here is whether your parents can give you more money than $40K/yr for undergrad, and how much of that would be a loan that they would require you to pay back.)

You can play with the numbers here:

https://mappingyourfuture.org/paying/standardcalculator.cfm
https://mappingyourfuture.org/paying/debtwizard/

15

First of all congratulations on your incredible accomplishments. The whole world has changed in a matter of a month. There is a chance that the class of 2020 might be starting the Fall semester a little differently than what everyone else has experienced in years past. Even though your parents could contribute up to $40K, is there a chance some of these schools might even fall below that amount. Considering the unknowns that we are all facing today, I would probably only consider the following choices, MIN, IU, MASS. These are all amazing schools and the opportunities will be there for you. The cost of attendance should be high on your list. Having said that, if money is not an issue for your parents, Michigan would be the obvious choice.

16

First, an engineering degree from almost anywhere is a better entrepreneurial degree than a business degree. Second, personal debt is a killer if you want to start a business. Every startup is cash flow constrained. Using some of that cash flow to pay for a previous luxury good is a bad investment decision. Lastly, the value of prestige from a BBA is derived from the career center (not the aesthetics of the building). If you are not going to use it, don’t pay for it.

17

OP wrote:

“I applied to 19 schools…I ended up getting into all of them +Ross.”

It would be interesting to see the entire list of schools to which you were accepted.

Cornell-Dyson ?

UPenn-Wharton ?

18

It is clear that you want to attend either Michigan-Ross or the Univ. of Texas at Austin-McCombs.

No one can advise you to take on $104,000 of student loan debt for Ross or $80,000 of student loan debt for McCombs.

Since these are your top choices, the question then becomes (no need to answer publicly):

Just how wealthy is your family & are they willing & able to comfortably pay all of your COA beyond a total student loan debt of $27,000 (for all 4 years) ?

19

OP asked:

“How much is a business degree worth ?”

Equally important and equally relevant:

How much is financial freedom worth ?

An entrepreneur does not need an expensive undergraduate degree.

Folks pay premium prices for the top business schools in order to compete for internships & jobs at the top investment banking (IB) firms and at the most prestigious management consulting (MC) firms.

20

isenberg is a really fine program. They also just built a state of the art facility last year for the school and latest trading facilities and latest in student tech.

If you could minor in a cs category where they are as good or better than your preference schools, that could be a home run for you. Not sure on the availability of cs minors.

I understand the appeal of the oos option and wanting to chart your own path. But free for Isenberg is pretty compelling and the lack of travel burden, costs and current environment. Logistics and costs ar really good first business lessons.

IU a close second.

If you can afford the costs as family.

Ross. Then UT. CmU is fantastic too.

No bad options.