MBA Degrees That Cause Staggering Student Debt

Wharton MBA graduates
John Duval, Flickr
By John A. Byrne

MBAs are taking on more and more student debt, so much so that graduates of at least six business schools last year borrowed more than $100,000 on average to finance their degrees. The heaviest debt was assumed by graduates of the University of Pennsylvania's Wharton School, where average debt hit an estimated record of $117,200. MBAs at Columbia Business School (an estimated $114,800), New York University's Stern School ($105,782), Duke University's Fuqua School ($102,054), the University of Virginia's Darden School ($105,490), and MIT Sloan ($100,212) all racked up six-figure debt, too.

Even graduating MBAs at second-tier schools were willing to go heavily into hock. At Fordham University's business school, 87 percent of the graduating MBAs -- the highest percentage at any school -- graduated with average debt of $69,637. At Thunderbird's Global School of Management and Pepperdine University's Graziadio Business School, average debt was $88,195 and $85,672, respectively.

More:Has The MBA Become A Worthless Degree?

The latest data was reported by the schools to U.S. News & World Report as part of its annual rankings project. Several business schools told U.S. News that debt levels rose substantially, far outpacing any gains in starting salaries and bonus. At Pepperdine, MBA debt jumped 29.6 percent over 2011, while at NYU's Stern School the average debt increased by 18.8 percent. In contrast, average salary and bonus for Stern MBAs increased by only 3.8 percent to $133,919 last year.

The crippling sums vastly overshadow the debt assumed by many of these same students during their undergraduate years -- loans that they are still paying off. For all undergraduate student borrowers, the average debt in 2011 was $23,300, though 1 in 10 owe more than $54,000, according to the Federal Reserve Bank of New York. Yet, at all of the top 10 business schools, MBA debt ranges from Wharton's $117,200 to UC-Berkeley's $63,652. The average for a top 10 school is $90,941.

Some schools, however, were able to lower debt levels of their students by more aggressively discounting tuition through scholarships. Average borrowing fell at both Dartmouth College's Tuck School, Northwestern University's Kellogg School, UCLA's Anderson School and Emory's Goizueta School, among other schools.

The largest decline of any top school occurred at Harvard. Thanks to the most generous fellowship grants of any B-school, Harvard Business School MBAs graduated with average student debt of $70,731, some 9.2 percent less than 2011, when the average was $77,880.
Top Ten Business Schools Graduating MBAs With The Most Debt
business schools graduating MBA debt

Source: Business schools reporting the average indebtedness of the 2012 and 2011 graduating classes to U.S. News & World Report.

Notes: An asterisk indicates an estimate by Poets&Quants based on reporting.

John A. Byrne is the editor-in-chief of and He created the first regularly published business school rankings for BusinessWeek in 1988.
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