The MBA Premium: What MBAs Really Earn Over a Career Will Surprise You

Discover the true value of an MBA! New analysis reveals graduates earn millions more over a lifetime, with top schools delivering over $8M. See how an MBA boosts your career earnings.

The MBA Premium: What MBAs Really Earn Over a Lifetime Will Surprise You

How much is an MBA really worth?

Most MBA applicants make a crucial mistake when answering this question. They scrutinize the starting salaries of MBAs, pull out their calculators, and make a quick return-on-investment assessment. But the starting salary after an MBA, even if it's higher than what you're earning now, is just the beginning: the true return is the impact an MBA will have on your lifetime earnings.

A new analysis conducted exclusively for Poets&Quants by payscale, which collects salary data from individuals through online salary comparison tools, shows that the MBA - even from schools lacking global or national caché - brings a hefty seven-figure income over a post-MBA lifetime. MBA graduates from the top 50 business schools in the US will earn an average of $5.7 million in cash after graduation and 35 years of employment. That's $2.3 million more than graduates with only a bachelor's degree.

FIVE MBAS OFFER A LIFETIME MEDIAN CASH SALARY OF MORE THAN $8 MILLION

And if you were lucky enough to get your MBA from one of the five schools - Harvard, Stanford, Berkeley, Dartmouth, or Virginia - your estimated median salary over a 35-year period would be more than $8 million, according to payscale. With the average age of a Harvard Business School graduate being 29, this 35-year period brings a person within one year of the retirement age of 65.

Yet, as high as these numbers are, they are conservative. They do not include any stock-based compensation, the present value of pension benefits, or other in-kind benefits, such as health care. The estimates developed by payscale refer to base salary, cash bonuses, and profit sharing in today's dollars over a 35-year and 20-year period. They are not a projection of future earnings. But the estimates show that the MBA degree - despite all doubts about its value - is one of the surest paths to a lucrative career.

The bottom line: Despite the high cost of education, the long-term return on education is undisputed. "Education should be a dream machine through which talented students come from anywhere - and go anywhere," says Scott Beardsley, Dean of the Darden School of Business at the University of Virginia. "While it's true that an MBA is a significant investment, looking at the salary data strictly in dollars and cents reveals a clear and compelling return. For those seeking a lifelong, meaningful, and impactful career, there is arguably no better investment than an investment in one's future through an MBA, which will open up a world of opportunities."