Examine the return on investment. Although this is not the only way to measure the value of an MBA degree, it works best as a starting point for doing so. If you invest $100,000 in a high-quality MBA program and your salary increases by $25,000 per year, your investment will pay for itself in just four years time. If you continue to work at that new salary for another 20 years (beyond the initial four), your ROI will be $500,000. This assumes that you do not invest the money and watch the principal grow through compound interest. Even so, the value of the MBA far exceeds the investment.
Consider the cost. In this context, the cost of the MBA degree is not what you spend in terms of tuition costs per se, but rather the potential opportunity cost. Opportunity cost is the amount of money you would have made in additional salary for the time that you spend pursuing the MBA degree. This can be weighed against the amount of salary increase you receive as a result of obtaining an MBA. For example, if you took two years to complete your MBA and gave up a job paying $40,000, you would lose out on $80,000 in salary. If your MBA helps you obtain a position that pays $50,000 per year, it will take you eight years to make up for the opportunity cost. In this scenario, you only gain $10,000 while losing $80,000.
Examine non-monetary factors. A December 2009 article in "Newsweek" noted that salary was just one consideration to make in weighing MBA value. Instead, additional factors like the skills that you obtain from pursuing the MBA provide another way to measure your MBA's value. MBA graduates earn skills that are applicable across a wide variety of industries. Randall Hansen, Ph.D., also notes that there is significant evidence pointing to the fact that those who hold an MBA degree have a better overall lifestyle; they work less hours while making more money.