US MBA Loan and Re-Payment->Worth It? A Discussion

[inblue]

OPT - Optional Practical Training

All students on F1 have a year after their graduation whereby they can work on a F1 visa. That is OPT.

If you find a job soon after and ur employer files for your H1-B, you dont need to bother. OPT is a saviour otherwise

[Neo2000]

<Edit>

If you discussing re-payment and all that jazz continue right here
If you discussing the original topic,tips, successes and failures(God Forbid!) continue here

http://www.pagalguy.com/forum/b-scho...hip-money.html

[inblue]

Originally Posted by bizTechie

kgkid, could you clarify this part. I didn't follow the terminology

I replied to this on the other thread ! Alas , It was closed

OPT is Optional Practical Training
Its basically a 1 year period after you graduate when you can work in the US on an F1 status in case your employer does not file your H1-B.

I might not be a guru but this is what it means in a broad sense. There could be deviations in the parameters though !

Inblue

[itsrahul]

Originally Posted by kgkid

+1.. it would take about 4 years by living pretty decent.

Moreover on your link on repayment, it is very biased. It is based on salary premium. Now, a Harvard grad already making 130K in a BB IB firm would have just a very low premium increase in salary. I mean seriously you have to analyze those numbers very carefully. Let me know if you want me to give my 2 cents on how those numbers are not to be interpreted as they are. If those numbers are so good then you would have maximum applications for Brigham Young and not Harvard. Isnt it my friend

One of the guys in our consulting wing is from Wharton. He got 4 times the joining bonus that he was offered from Bain. He also gets paid almost 30K more than what Bain offers. As per him, you can make average 150K in consulting including signing bonus, salary, tution reimburse. Moreover, i know those salary figures from many many guys i have known so far.
Now, one of my senior is finishing his MBA in 2007 from NYU. He dint start with any scholarship but he would prolly finish with 0 loans coz he did his summer internship at ML and is working part-time with them right now. On F1 you dont pay taxes. Even one year after MBA if you are on OPT you dont pay taxes.
It is as simple as "No pain no Gain". I want to be an enterpreneur and the way i look at it, if i cant manage this risk then i cant be an enterpreneur anyways.

cheers

Hmm. After reading these stats I will have to agree with you on this. It would be great if you could throw some light on interpreting the numbers part.

[inblue]

It might help to know how Forbes calculates repayment. Best Business Schools - Forbes.com

Even if the Number are a little unrealistic, you can definitely pay off in 4-5 years.
(Provided you dont want to drive a Porsche Carrera and live in Pacific Heights ) ha ha
(Even if you do that i think it should be 7 years )

[Neo2000]

Originally Posted by inblue

I replied to this on the other thread !

Eh? Its right here on this thread 2 posts above yours

Originally Posted by inblue

Alas , It was closed
Inblue

Eh Eh?? That thread is open

[kgkid]

Originally Posted by itsrahul

Hmm. After reading these stats I will have to agree with you on this. It would be great if you could throw some light on interpreting the numbers part.

I can help all i can

Looking at this link that you posted The High Price of Admission

The Years to payback has been calculated as Total Cost/ Salary premium

Now, when they say a Duke MBA has 258,689 then they are actually including tution (~80K) + living (~24K yeah living is very cheap in Durham) + lost income (prolly 160K for two years).
But look at the figure for Brigham Young (you can go to their website too), the average class makes pretty less pre-MBA so they arrive at a very low figure of 133,234.

Now we have to understood the concept of total cost as calculated by BW right?

Letz c salary premium. Brigham/ Wisconsin, etc have high premium which basically is postMBA salary - preMBA salary. If you are going in to such university with 45K annual salary but making 90K postMBA then your salary premium is 90-45 = 45K whereas if someone goes to Harvard and his pre-MBA is 130K whereas postMBA is 160K then his salary premium is just 30K. Because his pre-MBA is more then his Total cost would also be more and hence you would find an appx $300k / $30 ~ 10 years.

This is why those figures should be taken with grain of salt.

Now let us take indian guys like us. I am sure any desi engg in US can make upwards of 60K(Cleveland)-110K(NYC). Why should i go to a school that has low postMBA salary. Also, salary depends on location. A 80K in NYC is equivalent to 60K in Dallas, TX.

Hence, there are lot of complications involved when you look into those figures. My suggestions in the following order:

1. Look at the geographical locations the enrolled students are coming from (for example a very urban student community would tend to have higher pre-MBA salary).

2. Now look at avg or median pre-MBA salary for the school.

3. Now look at avg or median post-MBA salary in the function area you are targeting. The premium may be less but is it worth the kind of job you end up getting. May be corporate strategy in Google, Mountainview. How does that sound?

Now after analyzing the above 3 steps, your best bet is to fall in the bracket just below or lower end of the middle 80% pre-MBA salary range and hope for the best range for post-MBA salary. If you are able to succeed (and many graduates do in top 10) then your pay-back would reduce drastically.

Also, being an indian i donot consider my pre-MBA in USD even though i am in US. It makes me feel happy

Hope it helps!

[inblue]

Indeed !
KgKid, you need a name change.. No-more-Kgkid

May be corporate strategy in Google, Mountainview. How does that sound?

Now Boy !! Do I want that Marrisa Mayer life ?

[Susie Derkins]

Originally Posted by iday

<snip>
After school - we make our own destiny

Like getting hitched with a 100crore-wali

[shrp17]

Originally Posted by itsrahul

I am not a great Indian candidate but this is completely true in my case. I did not apply to top 10 becasue of financial constraints. I knew that if I get an admit, the school will help me get a loan to fund my education but in the end I will have to repay whatever loan i take. If i had chosen a top 10 school, I would have to spend a long tiem outside India to be debt free and this is something I wanted to avoid. Hence I chose the best college within my loan limits.
In fact, after I received my admit and was discussing my plans with an alum of HEC, he insisted that I apply to a top 10-15 college becasue he felt that I could get into a better college. But I didn't because of above mentioned reasons.

Hi Rahul,

This is indeed a very pertinent issue with most of the Indians, however as Iday said, it depends on an individual's outlook.

Since you have taken the decision to join HEC though you could have safely targeted a better B-school, could you list which other B-schools you targeted which fitted in your budget or which matched other practical entry criteria you had.

I want to compile a list of Tier-II B-schools (Sorry to use that term, I myself don't like it too much but that's what is used in common parlance) for the following two reasons:

1. I may not be able to make it to top-10 , in which case I need to see if there are any other schools which are worth the effort considering the fact that I am not hard pressed to do an aborad MBA

2. Even if I make to a top 10 school, I may not have the financial muscle to join them or repaying the loan might require me to work abroad for a longer duration than I wish to.

Either which way, having alternatives in place simplifies the analysis.

I would choose B-schools wanting to make a career in Finance/Consulting (Every body would want to do that, but in my case, thats what I have done in my career till date and I would want not to make an industry shift, but gain a global perspective and increase my breadth and depth in certain content areas )

In case the questions I have raised have already been answered in some form, please guide me to the appropriate post.

Thanks in advance..........