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.
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14 Mar 2014, 10:51
