Why a Full Time MBA?
A few people commented about my plans, saying that I should be considering a part-time or executive MBA, and keeping my business going. There are two reasons two do this:
- Money - to keep my income flowing, even if it is slower
- Contacts/Clients - to stay in touch with my network
The second reason is weaker than the first because everyone agrees that an MBA builds your network like nothing else can. However, the financial side of this decision is very interesting. I can afford to go back to school without going into debt. That is a tremendous luxury that many people don't have. But it will reverse the positive trend in my net worth for a couple of years, quite significantly.
As readers of this blog, you all know the gory details of my financial situation. Why do you think that I need to keep working during my MBA? Are you worried that I might not have a secure retirement if I spend $150,000 on an MBA and don't keep saving? If my net worth at age 35 is only $500,000 am I out of the game?? What if it's as low as $400,000?
The reasons that I want to do a full time MBA are a little bit less obvious:
- I'd like to live in another city. I've never done so as an adult.
- I'd like to be able to have time to learn and enjoy. I have friends who have done EMBA's and you literally have to take 20-30 hours out of your week, plus a day and a half of classes every other weekend. There's not much room for anything beyond work and MBA at that point.
- I want to do a complete career shift. I don't plan to go back to my old career in any way. So keeping my business going would be counterproductive relative to my career goals.
- I believe that I will get more out of the whole experience this way. More knowledge, more exploration, more networking, more unanticipated benefits.
These are mostly lifestyle and personal preference points. But isn't the point of money so that you have the freedom to do what you want, how you want? In a way, going back to school is like an indulgence for me. I love being in school. I am anticipating having a fabulous time there. And when I'm done, I will possess a qualification that will allow me to start earning money again. In fact, statistically, I should be able to more than catch up, but that is not something I am counting on.
So, in a roundabout way, this decision is about setting my own personal level of enough. I don't need to be the richest person around, and I have already succeeded financially beyond what I would have ever anticipated. I am now choosing to have my money do something for me, instead of me always doing things for money.
I hope that this post helps you to understand some of my reasons for making this decision. As always, I welcome your feedback and discussion!
9 comments:
I love your snippet "my own personal level of enough".
A part-time Executive MBA seems better for networking since your classmates would still be connected to their working lives (even if you're not). I took an evening Public Speaking course in university and especially valued the members of the community who attended. They had such different life experiences than us full-time students.
You're certainly in an enviable position thanks to your finances.
Excellent post. Hope you have a ball.
Yes if you are switching field of business then doing it fulltime is probably a good option. If you can get any low cost tax deductible loans for tuition I'd still consider them... depends what the tuition is and how much it will run down your assets. Your net worth position is very good. It's higher than mine and I'm 42 and quit my job :)
As an almost 35 year old (who did 2 4-year degrees full time) without anywhere close to a net worth of $500k, I say you'll be more than fine. :)
Good luck in your new town (and good for you for having the courage to move). I'll be curious to know where you end up!
OK! Against my better judgement I will get into this discussion even further.
Diva asked; "Why do you think that I need to keep working during my MBA? Are you worried that I might not have a secure retirement if I spend $150,000 on an MBA and don't keep saving?
Answer: I am worried that you will experience something very similar to what I experienced. You will not only sacrifice a well paid career(your computer skills will likely be obsolete by the time you finish your MBA) but the cost of school will set you back financially enormously. After you graduate you will find yourself unemployable in your chosen field because prospective employers;
1/ Do not like people who change careers
2/ Do not like people who are older unless they have massive amounts of relevant experience.
Degrees may be great for young people just starting out but a different matter entirely for those of us who have seen a few years pass by already. This may not be an issue if you intend to be self employed after you graduate, but then if that were the case an MBA probably wouldn't do you much good either.
You might recall "the Donald's" TV series called "You're Fired!" There was a sequence that set university grads against those who graduated from "the school of hard knocks". The later turned out to have the edge.
By the way I have spent many (far too many) years in University. I've never experienced it to be anything other than a massive amount of intensive work that required complete 24/7 devotion and left me burned out by the time I graduated. Enuf said.
Whatever your choice I wish you success and all the best!
If you have no intention of maintaining a presence in your old career, and you don't need the income, then yeah -- I don't see the point of continuing to work part-time.
I bet most of the concern from readers stems from a mix of jealousy and disbelief -- you're many things, Money Diva, but one of those is definitely not "out of the game" if your net worth dips to a half million dollars in your thirties!
Best of luck with your choice. You seem on very solid financial ground to me, so your main concern should be finding contentment in the job you do everyday. If an MBA will help that, I say go for it.
I think full-time is the way to go.
I took a part-time program while I worked and while it had some benefits, I would have prefered the experience that a dedicated full-tiem program would have provided.
If you want to break away from your currently career - there is no better way than a full-time program. If you "hang on" to the career you have by going part-time, you may never be able to get out..
Congratulations on passing the decision point! As I'm in a similar position (27 years, $300k net worth) the lure of a brief dalliance in B-School is incredibly strong. Engineers, too, get more than a little frustrated by how narrow that pigeonhole can be for those of us with technical skills.
As the sometimes outrageous tuition fees demonstrate, you pay dearly for the experience of an MBA program. Better to experience it to the fullest than be stuck wondering at 40 whether a full-time program would have offered you more in some way!
Cheers,
My partner has an undergrad in engineering (software). IT market driep up and he was unhappy with his career - at 36 years of age he was very disappointed with his career progress. I have convinced him to do an Executive MBA and it was a blast! Not only he was able to completely change his career and get much more stable job thru his school contacts, he also made tons of great friends. On ther other hand, time commitment of having classes every other weekend and tons of homework took a huge toll on him. The biggest advantage of doing EMBA was that an average age of the class was mid to late 30's. Many young people who never worked a day in their lives get accepted to do full time MBA and it reduces the quality of classroom experience and much less networking. So my vote goes for Executive MBA but then this is the option we discussed a lot.
The best of luck in your studies!
And hopefully you will continue to maintain your blog!
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