Age is one of the most important factors one has to look at when a person decides to do its master or not. At the moment, Ben’s annual salary of $50,000 and his current savings might be too small to prepare him for the future. In the future Ben might require a certain amount of money to live comfortably after retiring, and this is not possible with the money he is currently receiving. In today’s world a person is paid by the certificate he or she holds. With further education such as masters qualification, it would not only benefit Ben by increasing his potential to secure better position within the organization but also ultimately translates to higher income. A good MBA candidate should have an understanding of what the word “career” means these days. It means they will experience change. They should be prepared to experience employment changes, as well as moves to different fields and areas of expertise, just to survive in today’s business environment. An MBA prepares a person for the transient nature of today’s business world. (Veasley, 2009) It is part of most employees’ career goal to increase the salary that they are aerning and with a Masters qualification, such goals can be realized effectively. Graduates working instead of pursuing their MBA can later want to further their education; they say education has no end. If Ben does not decide to do his MBA now he has a choice to do it later after gaining some work experience. Some people feel that doing an MBA without work experience makes it more difficult to understand because that work experience makes them know a little about business world and thus enhance their knowledge from there.
Year 0 Year 1 Year 2 Year 3 Year 36 $37,000 $38,110 $39,253.3 $40,430.9 $104,112.91 Growing annuity PV= C PV (salary) = $37,000 c = Annual salary x (1- tax rate) = $ 50,000 x (1- 0.26) r = Discount rate= 0.065 = $ 37,000 g = Constant salary growth = 0.03 = $ 728,896.23 t = Number of years = 35 Ben will able to earn the amount of $728,896.23 in the future provided that he continues with the current job without further studies.
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