A New Salary-Vs-Debt MBA Ranking

Class with Wharton School professor of operations and innovation management Christian Terwiesch - Ethan Baron photo

Class with professor of operations and innovation management Christian Terwiesch at Wharton, from which MBAs graduate with a favorable salary-to-debt ratio   – Ethan Baron photo

When life gives you lemons, you squeeze them. When your business gives you big data, you crunch it. Through refinancing more than $4 billion in student loans, lending startup SoFi has harvested financial data from hundreds of thousands of MBAs. Now, the San Francisco company has analyzed nearly a quarter million loan refinancing applications from graduated MBAs to produce its inaugural “Return on Education” MBA rankings. The ranking lists provide salary-to-debt ratios for top schools, and some at the very low end. SoFi has also provided a window into outcomes at reputable second- and third-tier schools, where the bang for the buck is surprisingly high.

“I believe that this is very important for people thinking of doing an MBA, because this is kind of a proof of ‘what I may be able to get’ or ‘what I’m likely to get,'” says SoFi co-founder and VP of community and member success Dan Macklin. “Too often, they only see the sticker price for different schools.”

SoFi, which in September received $1 billion in Series E financing, has used its data to produce three rankings, which might generally be described as “the great, the good, and the ugly.” All three rankings include average salaries three years after graduation, average debt, and salary-to-debt ratio. The first up is a 20-school ranking by salary. Then comes a 10-school ranking by salary-to-debt ratio. (Both rankings in table form below.) The third, the ugly one, provides a dismal view at the bottom of the salary-to-debt picture, showing the schools which produce the worst ratio.


Only a single institution made both the great and good lists. Stanford’s Graduate School of Business unsurprisingly came up high – No. 3 – on the salary scale, with graduates averaging $177,590 three years out. But the GSB’s relatively low average debt  – $76,987 – also put it on the list of the 10 schools with the highest salary-to-debt ratios, where it occupies spot No. 4, with a 2.3X ratio. The GSB’s MBA candidates benefit from a large pool of scholarship funds – the school reports that half the students receive need-based scholarships, and last year the average grant was $35,830, higher than at any other business school.

Most of the MBA programs with the best salary-to-debt ratios have relatively low tuition and a short duration. The New York Institute of Technology MBA, for example, costs only $24,255, can be completed in one year, and has a 2.5X salary-to-debt ratio – their graduates were making $126,000, only about $5,000 less than MBAs with degrees from schools at the lower end of the top 25 . However, at California State University-East Bay, MBAs were pulling in just $90,000 – but the downtown Oakland school has a 2.4X ratio because the intensive one-year MBA costs a mere $29,800 in tuition, with no surcharge for non-residents. Florida Atlantic University’s Professional MBA takes two years, but costs only $36,000 to $41,400, regardless of residency, and the school has a 2.3X ratio and grads making $105,000.


“There are some smaller MBA programs in here that maybe people should be aware of because it looks like the salary-to-debt ratio is favorable to the student,” Macklin says.

Among schools with the lowest ratios of salary to debt were a couple of infamously atrocious for-profit operations: Kaplan University – where graduates’ $91,429 average debt swamps their $65,201 average salaries – and Strayer University, where $77,103 average salaries come up against a mountainous $93,430 average debt. Somewhat surprising was the poor performance of the public University of Missouri-Columbia, where graduates averaged $76,910 in salary but were left with $80,610 in debt. At the very bottom of the “ugly” list is Davenport University, a non-profit, Michigan-based institution, where students were bringing in $79,230, but struggling under $135,772 in debt.

  • Truth

    This article is completely worthless. The numbers are 100% false. How could this insanity be published? HBS grads make 158k three years after graduation? Booth grads make 157k three years after graduation? How is there no quality control to so much stuff posted on this site?

  • Close but no cigar

    Seems to me with this dataset a much better analysis could be made.

    ROI is all about incremental gain for a particular investment. Why not show the salary increase vs both the debt burden and foregone salary (for full timers)?

  • El Meerr

    Any data on INSEAD?

  • TechInsane

    Well said.

    MBA class of 2015 Kaplan business school.

  • Dean Boyd

    This story is very misleading on a number of levels.

    The debt burdens cited and used as the underlying basis for the ranking includes all outstanding student loan debt applicants had when they applied for a SoFi refinance loan. So by way of example, the loan debt a student accumulated while attending one or more other institutions before going to business school is counted and assigned to the business school. This central fact, which was not included in the story, penalizes schools that cater to adult learners, who pay their own way and typically attend multiple schools on their path to an MBA degree.

    To bring this into sharper view, here are some facts about Kaplan University based on a two year cohort of more than 1,600 MBA graduates (the sample size that SoFi used for calculating our MBA student debt was 21, hardly the sort of big data this story touts).

    An MBA student at Kaplan University pays approximately $28,000 in total tuition. The average debt for a MBA graduate from Kaplan University (which includes interest and loans taken out for living expenses) is approximately $38,000. The average earnings for an MBA graduate is approximately $64,000.

    Most of our students are adult learners who are financially independent. They are raising families, paying bills and trying to make ends meet while going to school. They are not relying on others (parents) to help pay for school. Many have outstanding debt from other institutions they attended earlier in their academic lives. Instead of being derided, they should be celebrated.

    Dr. Thomas Boyd, Dean
    Kaplan University School of Business and Information Technology

  • Herbert Weiner.


    >#10, SMA

  • Ethan Baron

    BYU fans, no hard feelings – SoFi listed schools it had enough data for, and its ranking should not be taken as comprehensive. Note also that the link in the story to a U.S. News ranking shows Marriott at sixth-best for salary vs. debt.

  • DardenMBA

    Yep… I completely agree. I am not sure how P&Q did not consider BYU in this, as it would’ve led this ranking, or other forms of ROI as well. Well noted.

  • Young

    It baffles me that these lists always fail to list BYU, as if they have something against the school. Average Debt: 20k, average salary: 110k. Salary to debt ratio crushes all these schools.

  • Ethan Baron

    You make a valid general point about $200K income vs. $100K debt, however if you look at SoFi’s numbers, the debts for the elite schools are still much higher (mostly around $100K) than for the “best ROI”-list schools (mostly around $50K), but elite grads’ salaries aren’t double those of grads from the ROI schools… so ranking by difference would produce odd results. You’d have Cal State East Bay, for example, ranked higher ($52K difference) than NYU Stern ($48K difference) and Michigan Ross ($40K difference) when the Ross and Stern grads are making $50-70K more in salary and would be perceived to have achieved a much more elite outcome.

  • Jayc

    This is a great way to do a ranking, but I’d argue ratio is a flawed metric in this regard. A better metric would be *difference* between debt and annual salary.

    Eg, it’s a more favorable outcome to be making $200k income on $100k debt (2:1 ratio, but 100k difference) than to be making $100k income on $33k debt (3:1 ratio, but only $67k difference). That extra money/yr in the first example will add up fast and outpace the “higher roi” MBA in example 2, and probably represents a more “elite” career outcome.