Starting Life

Here is my situation: I'm 23 yrs old with a Bachelors degree, current salary of 40k, getting married in July, fiance' makes about 28k, we plan to start a family about 3 years.

Question: I would like to get an MBA from BYU (Brigham Young University). The have a day program (20k) and an executive (night) program (30k). The day program doesn't allow me to work during the first year of the program, and is ranked among the top 50 mba programs in the nation. If I do the executive program my employer will reimburse me up to 8k/year. BYU highly discourages married individuals doing the executive program. What do you suggest?

Question: I contribute 5% per paycheck to my 401k, and my employer matches up to that. Should I contribute more? What other kind of savings should I start?

BYU discourages married individuals from doing the night program? Last time I checked, marriage is a protected class and they can't discriminate on that, so I would completely ignore that. As long as your wife is OK with you spending a significant amount of time away from her, I'd strongly suggest the night program over the day program -- in the end, you'll still have the same degree, but in one scenario you get to make money while doing it.

One thought, though. An MBA is NOT like a bachelors in history or something where you need to just go to a decent school. If you look at the statistics, an MBA is not going to add to your career just because you checked the box. Top 50? That means that there are 49 other schools, each churning out hundreds of more highly qualified people every year. And most of those other 49 would not take someone with no work experience for the simple fact that an MBA is meant to build upon the work experience you already have. How would you even know what to concentrate in if you haven't worked in the real world yet? The picture you have in your head and the experience you get at a desk are two completely different things. If I were you, I'd wait a few years and go to a really good business school. Or go to BYU after a few years of experience when the program will actually mean something to you. I have friends who've done it both ways, and the ones who waited and went to a good school -- Wharton, Kellogg, etc, are definitely outpacing the others, so I'm following that path, too (25 yrs old, and will not even consider applying for another couple years).

On the investment thing, I think most people here will recommend maxing out a Roth IRA in your situation after you contribute the full amount to your 401k that your company will match.

Good luck!

BYU is a private university, and as such, Federal discrimination issues don't apply. They can be as discriminatory as they please.

If you want the MBA from BYU more than you want the husband at this time, put off the wedding.

If you want the marriage more than you want the MBA, tell BYU to take a hike.

I agree with FinStat's assessment of the "worth" of an MBA, even from a top school.

I also wonder how realistic you're being in your goals, and strongly encourage you to sit down again and ponder them very deeply and thoroughly. For example, you say that BYU's MBA program doesn't allow you to work in the "first year" of the program -- meaning that it typically takes longer than one year to complete? Let's say it takes two years -- are you saying you're only going to spend one year in the workforce before having a baby? Why would you not use the MBA to advance your career to a solid point (which takes more than one year) before having children? And what if it takes three years to complete your MBA -- are you going to go ahead with the baby plan, and essentially not use your hard-earned MBA?

Sadly, we women have to put up with several facts about child-rearing and work -- namely, that there are HUGE financial penalties for women who choose to procreate, especially when they choose to do so in the early years of their career. I would strongly encourage you to think about the three major things you are talking about here -- career, husband, children -- and figure out what matters more, and where they REALISTICALLY fit in the timeline of your life (because one thing they don't tell you is that "having it all" doesn't mean having 100% of it all...it means having pieces of it all). If career stability means more, you may have to be more flexible in the baby-deadline. If the MBA is more important than the husband, put off the wedding. If the husband is more important, find another program. If being a mother (especially a stay-at-home mother) is the most important of the three, then don't waste your time or money in an MBA program.

On the other hand, if you've fixed it so that he's going to stay home with the baby (which would make more sense, as you are the primary breadwinner), then you just have to negotiate the hurdle of the MBA program, and you're back to FinStat's advice -- BYU isn't the end-all be-all of MBA programs, and you should find one that more realistically (that word again!) fits with your life and lifestyle.

As to your retirement, I would absolutely contribute more, and max out a ROTH IRA every year. At your age, the magic of compound interest is even MORE magical than it would be if you waited even three or four years. Sock away as much as you can, and watch it grow!

Here's a simple savings calculator -- it can show you the different over time in saving 5% and saving, say, 8%.

http://www.ataccorp.com/calculators/calc-savings.html

Finstat: Let me rephrase, BYU doesnt "discriminate" against married couples, they just make you aware of the stress you will cause your marriage by working full time and going to grad school at night. But in no way does it affect you acceptence or rejection. I agree, I am planning on working for two more years before I apply for grad school, I was just trying to get an idea of what program to attend. I am still leaning towards the day program because it is so heavily recruited from with an above 90% career placement rate within 6 months of graduation. Especially if my wife and I dont have children she could support us for one year while I am in school and it would be a lot less stressful on our relationship. And I was being modest with BYU's Marriott School of Business ranking they are probably in the top 20 and for the price I dont think there is a better value.

Puck: I think much of your advise was based on the assumption that I am a female, which I am not. But from that perspective I completely agree.

I agree with both of you on the Roth IRA. I plan on opening one next month, any suggestions on what institution to go with? My 401k is with fidelity so i will probably check there first.

Wow, egg on my face! -- don't know why I made that assumption! There are little or no financial penalties for MEN having children at practically any point in their careers, soignore that part of the advice.

But the marriage issue still applies -- if you want THIS MBA program, it would be wise to delay the wedding. Otherwise, I suggest shopping around for a different program.

Puck: What about this particular MBA program is different than any other that would make me want to delay my wedding? My thinking is that any MBA program is going to strain a marriage, that is why I am leaning towards the day program and to not work for the first year, rather than work all day and go to school at night. If it comes down to it marriage is more imporant so there is no way I am going to put it off 4+ years until my MBA is finished, because I dont plan on starting it for another 2 years. What type of MBA program would you suggest I shop for if I insist on getting married now? Thanks for your suggestions.

I agree, I am planning on working for two more years before I apply for grad school, I was just trying to get an idea of what program to attend. And I was being modest with BYU's Marriott School of Business ranking they are probably in the top 20 and for the price I dont think there is a better value.

I agree with both of you on the Roth IRA. I plan on opening one next month, any suggestions on what institution to go with? My 401k is with fidelity so i will probably check there first.

My and my wife's Roth IRA's are with Fidelity, and we have had nothing but success with them so far.

Maybe you should bring back the modesty: BYU's program is not in the top 20. According to US News, they're in a 4-way tie for 41. According to the other major rankings, they're not on the list. I don't mean to trash your preference, but I just want to make sure you're aware that A) you shouldn't be married to one school this early in your career, no matter what it is. I'll probably apply to 5-10 b-schools, as did most of my friends. The guys that apply to only one school almost always walk away dissapointed (if you don't get in, you wish you would have had a back-up, if you DO get in, you wonder whether you could have gotten in somewhere even better) B) BYU is not by any means the best value -- there are many school above them on the list that are cheaper public universities, C) the fact that you don't know their ranking means that you probably haven't done enough research to even know what makes them a good/bad school, where their strengths/weaknesses are, etc. There are many schools that place 90% of their grads w/in the first 6 months, but if they're placing them at an average salary of $60k or something, that's certainly not a worthwhile venture! D) at this early in your career if you are serious about an MBA, you should be aiming higher. This notion that everyone needs an MBA as early as possible and from whatever the local college is is ridiculous! You're talking about forgoing 2 years of income and/or giving up 2 years of nights/weekends and/or paying 6-digits in tuition; there are very few schools for which the NPV of that equation is >0.

Puck: What about this particular MBA program is different than any other that would make me want to delay my wedding?

The fact that you even have to ask that question says that you don't even know enough about your field to choose your MBA program wisely. Either you are incredibly ambitious, and you are choosing the best school you can afford to attend, or it's the closest MBA within a few minutes' drive, and it's "good enough" and just happens to be ranked in some listings. There are "easier" MBA programs out there. As FinStat's research indicates, BYU's program "isn't all that", which means you could choose to go to an "isn't all that" school where the program isn't as strenuous.


My thinking is that any MBA program is going to strain a marriage,

The program will strain your marriage to the extent that the two of you allow it to strain your marriage. So long as you understand that you CANNOT spend all your mental and physical energy on this MBA program (no marriage can survive even a temporary ignoring -- it must ALWAYS be nourished, much as a baby must be fed and changed, whether you feel like doing it or not), and so long as she understands that she MUST give you up to studying now and then, the marriage doesn't have to be strained.

And yes, some programs are more strenuous than others. If you fear this program will strain your marriage, then choose another. As you say yourself....marriage is more imporant...so it would be wise to choose a program that is LESS of a strain on a marriage. Especially on a new marriage!

BTW, I speak from experience. My Ph.D posed a huge strain on my marriage. It is simply impossible to "have it all" when it comes to being in a marriage and a graduate program. It's a bit like trying to keep yourself, and two unconscious people afloat while treading water -- sometimes, you'll let one go to tend to the other, then grab at them before they sink. If you're lucky, you reach the end without losing anything of value to you. Had I chosen a less prestigious program, it would have been much easier. Or, had I chosen to marry only after my program was complete, either way! :D

that is why I am leaning towards the day program and to not work for the first year

So, she's going to support the two of you PLUS tuition/books/expenses, on $28k a year? I'm not sure there's any place in the country where that is affordable! So, in addition to my other advice, I'd strongly recommend putting pencil to paper, and doing the math. Student loans can help of course, but I think you will find it very difficult to lose so much income. And I speak from experience, for I had a Bachelor's and a full-time career when I decided to chuck it all, move cross-country, and attend graduate school. I know the pain of losing a chunk of income, and trying to live off of a minimal income, and student loans. It's very doable -- the real pain comes when you graduate with the equivalent of a mortgage to pay back.

What type of MBA program would you suggest I shop for if I insist on getting married now?

One at another school. A program that is less strenuous. MBA programs are not created equal. And FinStat has a point, in trying to show you that choosing BYU is not choosing, say, Harvard's MBA, or Wharton School of Business. In many ways, you could choose BYU, or you could choose, say, Podunk State, and have something roughly comparable. And in the end, most businesses, only care about those three little letters...M...B...A....and nothing else.

The only thing you really have to worry about is not choosing a school that has a bad reputation for its MBA programs. There are very few such schools, but there are some. If you are graduating with a Bachelor's in business, your department should be able to advise you on which schools are considered a sheer waste of time.

And the only other consideration would be your field/employer. If you have your sights set on a particular employer or field, find out what THEY want in a candidate.

FinStat: You are correct that I shouldn't only apply to one school, which I am not, that is just my preference, just like you I am sure you have a preferable program you would like to attend. My situation kind of limits my choices, I own a condo here in Utah and my future wife has a good job she loves so we decided it would be best to attend grad school it Utah, and why not there a a few good programs here with BYUs being the best in my mind. So with my limitations in consideration I believe I am aiming as high as I possibly can. I have done some research, and it all just depends on what rankings look at. According to a quick search I just did Forbes ranked BYU's MBA program 17th in the nation. And more importantly Princeton Review ranked it #1 in "most family friendly" which is very important me because I will be married and might have a family. If you want more exact numbers the placement is at 96% with and average salary of 80k, which is very good for Utah. Tuition is not even close to six digits, it is $4,300 / semester, and like I said you are not going to find a better school for a lower price, especially if you consider that I would be paying out of state tuition anywhere outside of utah. Everyone is unique and choosing the appropriate grad school is a decision only they can make based on their personal circumstances. My situation is completely different than yours or your friends. I am looking pros and cons for day and night programs, preferably from someone who has done one or the other.

According to a quick search I just did Forbes ranked BYU's MBA program 17th in the nation. And more importantly Princeton Review ranked it #1 in "most family friendly" which is very important me because I will be married and might have a family. If you want more exact numbers the placement is at 96% with and average salary of 80k, which is very good for Utah. Tuition is not even close to six digits, it is $4,300 / semester, and like I said you are not going to find a better school for a lower price, especially if you consider that I would be paying out of state tuition anywhere outside of utah. Everyone is unique and choosing the appropriate grad school is a decision only they can make based on their personal circumstances. My situation is completely different than yours or your friends. I am looking pros and cons for day and night programs, preferably from someone who has done one or the other.

It's #17 on Forbes's list IF you happen to have it sorted (as does the google search) by "5 year compensation after graduation minus the sum of compensation and forgone compensation while in school." Since BYU's incoming students have the LOWEST income on the entire list, this number is artificially inflated because the forgone compensation is so low. You can just as easily sort that list by "location" in which case BYU is pretty low on the list due to "Utah" being near the end of the alphabet. On the other hand if you sorted it by school name, I'd be willing to send them an application. :-)

As for the "family-friendly" thing, I think that's as much a con as a pro -- a hiring manager may just as easily perceive this as a sign that you have yet to prove your ability to juggle your family and a strenuous commitment.

Again, I'm not saying you shouldn't do it; I'm just answering one part of your question and commenting on the tenacity with which you're adhering to a decision you are years away from needing to make. Who knows -- in 2 years, you may live across the country or the world!

I don't think a hiring manager is going to care or even know that BYU is a "family friendly" program, and accoding to Puck that manager wont even care where I got my mba, which I disagree with.

I know in 2 years things can change, so should I not plan anything? I dont think so, if you fail to plan you plan to fail. I'm obviously not going to still try and go to BYU if I live across the world in two years, but I would like to be prepared for my most probable situation in two years.

Thanks you for your input, it is good to play out these discussions, and make me think a little. To this point I feel assured in my decision to try and attend a BYU program day or night, of which still hasnt been decided.