Group 3 Eric Aube Joseph Tirona

How long do I have to stay in school? Bachelor’s vs. Master’s in Engineering vs. MBA By Eric Aube and Joseph Tirona

Scenario A Mechanical Engineering student at Cal Poly is about to graduate with his Bachelor’s Degree. He has a 3.6 GPA and gets offered a job at Jet Propulsion Laboratory for $60,0000. He is debating between: taking the job offer, staying in school to get a Master’s Degree in Mechanical Engineering, and getting a Master’s in Business Administration (MBA).

Scenario 1: Bachelor’s Degree Age at Graduation: 23 Starting Salary: $60,000 (salary.com) Retiring at: 62 Annual salary increase: 3% Percent of pre-tax income in 401K: 15% – Company matches 80% up to 10%

Scenario 2: Master’s Degree in Mechanical Engineering (CPP) Full time Graduate Student Age at Graduation: 26 Starting Salary: $70,000 (salary.com) Extra tuition cost: $20,000 over three years Retiring at: 62 Annual salary increase: 3% Percent of pre-tax income in 401K: 15% – Company matches 80% up to 10%

Scenario 3: Master’s Degree in Business Administration (CPP) Full time Graduate Student Age at Graduation: 25 Starting Salary: $65,000 Extra Tuition Cost: $12,000 over two years Retiring at: 62 Annual salary increase: 3% Percent of pre-tax income in 401K: 15% – Company matches 80% up to 10%

Criteria Which of the three options will yield the best future value at age 62? Holding all other factors constant – Cost of transportation – Cost of living – Personal expenditures (food, vacations, etc.)