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How much do you REALLY spend in business school?

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Intern
Joined: 24 Oct 2013
Posts: 10
Location: United States (IL)
Concentration: Entrepreneurship, Marketing
GMAT 1: 690 Q45 V40
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14 Mar 2014, 10:51
Hi everyone!

Every MBA program has a calculated "total cost of attendance", which typically includes tuition, room/board, a new computer (sometimes), personal expenses, health care, etc.

But there are a lot of extra activities and expenses that are not calculated into the total cost of attendance... things like social activities, networking/job search trips, etc.

My question: how much did you actually spend / intend to save for these extra expenses? This Anderson blog post - http://mbablogs.anderson.ucla.edu/mba_students/ - recommends $10,000 over the two years. What do you think? Too much, not enough, or just right? Manhattan GMAT Instructor Joined: 01 Jul 2013 Posts: 195 Followers: 8 Kudos [?]: 28 [1] , given: 0 Re: How much do you REALLY spend in business school? [#permalink] Show Tags 15 Mar 2014, 19:34 1 This post received KUDOS Expert's post If it's$10000/2 years, that's about $5000/year, or about$100/week. To see how that feels -- start Monday morning with 5 $20 bills -- and see how long that gets you! That'll give you a good idea Obviously, life changes in b-school -- but people still get drinks, order pizza, play golf, etc. You do things that require spending money! Best of luck. Brian _________________ Brian Lange | Manhattan GMAT Instructor | North Carolina Manhattan GMAT Discount | Manhattan GMAT Course Reviews | View Instructor Profile Current Student Joined: 30 Jan 2010 Posts: 301 Location: United States Concentration: Strategy, Economics Schools: Chicago Booth - Class of 2015 GMAT 1: 770 Q V0 WE: Project Management (Real Estate) Followers: 12 Kudos [?]: 139 [5] , given: 73 Re: How much do you REALLY spend in business school? [#permalink] Show Tags 16 Mar 2014, 10:02 5 This post received KUDOS brianlange77 wrote: If it's$10000/2 years, that's about $5000/year, or about$100/week. To see how that feels -- start Monday morning with 5 $20 bills -- and see how long that gets you! That'll give you a good idea Obviously, life changes in b-school -- but people still get drinks, order pizza, play golf, etc. You do things that require spending money! Best of luck. Brian If I were the OP, this would not be a very helpful response. This basically assumes he's not tracking his budget at all right now and would give him a weird way to benchmark his current lifestyle. I'm going to assume he really wants to know about budgeting for the dramatic lifestyle change of pursuing a full-time MBA. @BinyaBinyaPollywog First off, the blog post isn't saying the cost of all the discretionary stuff is$10k. The author of the blog is saying that $10k is the difference in discretionary spending between and good MBA experience and a great one. Personally, I think you can have a great experience either way and that the author is being a bit flippant about a large spending decision. That said, I tend to agree that$2,000-3,000 once or twice a year for once-in-a-lifetime experiences (e.g. international travel with classmates) is worth it.

In regards to your original questions, there are a lot of variables to consider here and it's hard to put a lump sum number on it. Let's try to disaggregate the numbers a bit and see where it gets us.

Meals - Think about how you eat now and how much you spend. If you're in a major US metro and eat out every meal, you're looking at $20-30/day. If you are a champion grocery shopper and home cook, the number is easily half of that. Now, what happens when you go to B-school? Because of the demands on your time and the desire to hang out with friends, you will almost certainly be eating out more. This will be offset somewhat by free food during the height of recruiting season, if you can stomach pizza and boxed sandwiches 4 days/week. I spend 20-30% more on meals than I did prior to B-school. Travel and Transportation - You should be able to project this relatively closely. LA is a car-centric city (one of the reasons I moved to Chicago after a decade in LA). If you plan to bring a car to school, figure out your parking, insurance, etc. If you can get by without one, you'll be better off financially for it. Don't forget to figure in the cost of a transit pass, occasional Zipcar, and cabs home from the bar. Bars and general socializing - As with meals, take a look at what you're doing now. These costs will likely go up, especially if you're not usued to LA/SF/NYC prices. Clubs and Exceptional Events - This is basically a new category in your life. I'm tracking right around$3,000/year for club dues, case competitions, conventions, forums, and social events (30-person excursions to NBA game, formal dances, etc) that definitely wouldn't have happened in my previous life.

Travel - This is a part of the experience that I've tried to prioritize. There are a couple of categories of trips to consider. Most schools offer myriad opportunities for pre-orientation/pre-2Y international travel over the summer (which I highly recommend, ski trip or career treks over winter break, career or cultural treks (or international beach-drinking) during spring break, as well as random 3-day weekends to less far-flung locations. I've budgeted almost $5,000 for two big trips/year. As a rule of thumb, I figure domestic trips like ski trip or a career trek run$1,000-$2,000 and international trips run$3,000-4,000. Big trips require time and money. Right now I have time, but not much money. In a few years, the reverse will be true.

Laptop and Books - Do you plan to buy a new one? If so, you know about what they cost. I've found the estimate for book spending to be very conservative. I've spent less than $150/quarter. Part of that is because Booth has gone 95% digital on coursepacks. I know it's not a definitive answer, but I hope this is some help. You budget can vary wildly depending on the choices you make. I feel good about my prospects after school and don't feel I've had to sacrifice much coming to B-school. If the extra$10k that the blog author advocates is not within your means, don't feel pressured to spend it. Know what's important to you and stick to your guns. There is plenty of free/cheap stuff to do in LA without spending 2-3 nights/week at the bar. There will plenty of your classmates for whom frugality is important.
Director
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16 Mar 2014, 14:00
What a good figure per year for Rent/Food/entertainment/transportation, $30k? It'll vary by location, but lets say for Duke/LA/Kellogg. Current Student Joined: 30 Jan 2010 Posts: 301 Location: United States Concentration: Strategy, Economics Schools: Chicago Booth - Class of 2015 GMAT 1: 770 Q V0 WE: Project Management (Real Estate) Followers: 12 Kudos [?]: 139 [0], given: 73 Re: How much do you REALLY spend in business school? [#permalink] Show Tags 16 Mar 2014, 14:55 mgh234 wrote: What a good figure per year for Rent/Food/entertainment/transportation,$30k? It'll vary by location, but lets say for Duke/LA/Kellogg.

Food, entertainment, and transportation vary quite a bit with your eating habits (out vs. groceries), mode of transit (car vs. public), as well as the level of and preference for certain types of social activity. In very board terms, monthly costs might be:

Food: $500 (almost all groceries/not ramen) -$1,000 (dining out every meal, with a few nice ones)
Entertainment: $100 (board games and movies) -$1,000 (bars several nights/week)
Transportation: $100 (walk to campus and transit for other stuff) -$600+ (car payment, insurance, on-campus parking, tickets, moderate cab use)

As far as rent goes, I can't really speak to Duke, as I haven't lived anywhere near Durham. I imagine it's at least somewhat cheaper than LA or Chicago though. The numbers for the other 3 are fairly similar and based on my having lived in LA and Chicago as well as doing some apartment-hunting in Evanston.

Studio/1BD (private) - $1,250-$2,000/mo utilities included
2BD/3BD (split w/ private bedrooms) - $750-$1,500/person/mo, utilities included

These ranges span from low-quality (white plywood cabinets, all-carpet, long walk to campus, no amenities) to very nice (hardwood, stainless, granite, near campus, pool, fitness, doorman) but not necessarily ultra-luxurious options.
Current Student
Joined: 30 Jan 2010
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Schools: Chicago Booth - Class of 2015
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16 Mar 2014, 14:58
A quick addition: when you visit campus, be sure to ask current students whatever questions you have. This has been my best resource for almost every topic imaginable.
Director
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16 Mar 2014, 15:00
So in general, an average student probably spends about $25k it seems, way higher than the$15k estimate schools like ross give.
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16 Mar 2014, 15:09
If we put on the side your expenses for school as books, laptop etc it will depend on the location of the school and the lifestyle you want to continue. For many it might be really hard to go back to the student lifestyle
Current Student
Joined: 30 Jan 2010
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Location: United States
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Schools: Chicago Booth - Class of 2015
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16 Mar 2014, 20:29
mgh234 wrote:
So in general, an average student probably spends about $25k it seems, way higher than the$15k estimate schools like ross give.

I'm not sure I follow you. The numbers I gave are guidelines for Chicago or LA. Ann Arbor is a significantly cheaper place to live. Had I gone to Ross, I would have paid around $800 for my half of a huge, updated 2BD/2BA in a full-amenity complex.$5-10k cheaper for AA doesn't sound unreasonable, and I think the COA numbers reflect that. On the other hand, I would expect living expenses in NYC (Stern, CBS) or the Bay Area (Haas, Stanford) to be somewhat higher.

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29 Mar 2014, 18:04
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Expert's post
brandon432 wrote:
mgh234 wrote:
So in general, an average student probably spends about $25k it seems, way higher than the$15k estimate schools like ross give.

I'm not sure I follow you. The numbers I gave are guidelines for Chicago or LA. Ann Arbor is a significantly cheaper place to live. Had I gone to Ross, I would have paid around $800 for my half of a huge, updated 2BD/2BA in a full-amenity complex.$5-10k cheaper for AA doesn't sound unreasonable, and I think the COA numbers reflect that. On the other hand, I would expect living expenses in NYC (Stern, CBS) or the Bay Area (Haas, Stanford) to be somewhat higher.

Posted from my mobile device

Jumping back into this conversation, despite Brandon not feeling my earlier comments were all that helpful. It's actually pretty amazing that there aren't greater resources to answer this question (e.g. why don't b-schools ask 20 students per year to anonymize their Quicken/Credit-Card data and publish it?)

I think Brandon's suggestion of having real conversations with real students when you are on campus is probably his most helpful point of feedback.

The reality is that you can get by on very low budgets (and make tradeoffs in the short-run) or you can spend more heavily and just have a greater debt load when you are done.

In the grand scheme of things -- what's an extra \$15-20K for 20 months of b-school, right?
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26 Nov 2015, 21:37
I think it all depends on the person and what they like to do with their free time. Sure, you can attend every event, join every club and make every trip. It will probably cost you lots and lots of money, but you can do it. What I recommend is really figure out what you have first, then with that money, prioritize what is important to you. If something isn't that important and you don't have the money, just say no. Don't let the fear of missing out (FOMO) rule your wallet. If you do, you'll end up in even worse debt!
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Re: How much do you REALLY spend in business school?   [#permalink] 26 Nov 2015, 21:37
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