Expectation vs. Reality for Salary Packages: What You Need to Know

We all dream about landing that perfect job with an impressive salary, especially after investing years and money into degrees like an MBA, MS in Engineering Management, or a Master’s in Business Analytics. After graduation, many students imagine six-figure salaries, rapid promotions, and a clear path to financial freedom. But how often does this expectation match the reality?  

In this post, we’ll explore people's common salary expectations and compare them with the actual numbers and experiences faced by graduates today. Let’s look at where the biggest gaps lie and how you can manage your expectations to avoid disappointment.  

The Expectation Trap  

Let’s be honest: between career fairs, glossy brochures, and LinkedIn success stories, salary expectations can easily get inflated. A lot of us hear about top MBA graduates earning $150,000+ right out of school and assume that’s the norm. The reality, however, is more nuanced.  

Here are some of the most common salary expectations:  

Let’s break down each of these expectations and compare them to what typically happens in the real world.  

Expectation 1: Six-Figure Salary Right Out of School  

What People Expect:  

Many students believe that after finishing an MBA or a specialized master’s, they’ll start earning six figures right away. After all, schools like Harvard, Stanford, and Wharton often report average salaries of $150,000 or more for their graduates, which makes it easy to assume that this will be true for everyone.  

Reality:  

While top schools and certain industries do offer big salaries, that’s not the whole picture. In fact, the  Graduate Management Admission Council (GMAC) reported that the  median salary for MBA grads worldwide in 2023 was around  $115,000 —still high but not quite the six-figure jackpot most expect.  

If you look at specialized degrees like a Master’s in Engineering Management or Business Analytics, the figures are more varied. In Europe, for example, graduates from these programs typically earn between  €45,000 and €65,000 a year, which is considerably lower than U.S. figures.  

Expectation 2: Promotions and Raises Will Come Fast  

What People Expect:  

Most of us assume that after getting our foot in the door with a high-paying job, promotions and raises will follow quickly. With all the new skills gained from a master’s degree, it seems natural to expect rapid career growth.  

Reality:  

Career growth takes time. Even in high-paying fields like tech or finance, promotions don’t happen automatically. According to a  McKinsey & Company study, the average time it takes to move from entry-level to mid-management is  5 to 7 years .  

Moreover, companies are often more structured in their promotion schedules, meaning you’ll need to show consistent performance, build relationships, and prove yourself over time before seeing big jumps in salary.  

Expectation 3: Industry Choice Won’t Affect Salary Much  

What People Expect:  

Many people believe that the degree itself—whether it’s an MBA or a master’s in finance—guarantees a high salary regardless of the industry they enter.  

Reality:  

Industry choice matters a lot more than most realize. For example, an MBA graduate who joins an investment bank can expect a salary upwards of  $120,000 to $150,000 . On the other hand, if the same graduate chooses to work in non-profits, the starting salary might be closer to  $60,000 . The difference can be stark, depending on which sector you choose.  

Here’s a quick comparison:  

So, if you’re chasing high salaries, it’s critical to align your career goals with the industries known for paying more.  

Expectation 4: Location Won’t Have a Major Impact  

What People Expect:  

With the rise of remote work, many graduates believe that where they live won’t affect their salary much anymore. After all, why shouldn’t someone living in Austin, Texas, make as much as someone in New York City for the same job?  

Reality:  

Location still plays a huge role in determining salary. While remote work has blurred some lines, companies typically adjust pay based on the local cost of living. For example, software engineers in San Francisco earn an average salary of  $135,000 , while those in cities like Austin or Denver might earn closer to  $105,000 .  

Cost of living in these cities varies greatly, so what seems like a big salary in one place might not stretch as far in another. Here’s how different cities compare:  

It’s important to weigh the salary against living costs when evaluating job offers.  

Aligning Your Expectations with Reality  

Now that we’ve looked at some of the biggest expectation gaps, how do you manage these to avoid disappointment?  

1. Do Your Homework  

Before committing to a program or a career path, do thorough research on the industries and geographic locations that interest you. Most schools publish detailed employment reports that give you a clearer picture of what graduates earn in specific industries and locations.  

For example,  Stanford’s Graduate School of Business publishes reports that show starting salaries in finance, tech, and other fields. The numbers vary drastically, so it’s important to understand where your degree can take you.  

2. Be Realistic About Career Growth  

While it’s tempting to expect fast promotions and salary hikes, it’s important to understand that career progression often takes years. Consistent performance, networking, and learning new skills are what drive promotions—not just a shiny new degree.  

3. Weigh Industry Options  

Be sure to weigh the trade-offs between different industries. High-paying sectors like investment banking or tech might offer more money, but they often come with more demanding work hours. On the other hand, industries like education or non-profits may offer more fulfilling work but at a lower pay rate.  

4. Consider Location Costs  

When evaluating job offers, always factor in the cost of living in the city where you’ll work. A lower salary in a more affordable city might offer you a better quality of life than a higher salary in an expensive city. Use online tools like cost-of-living calculators to make these comparisons easier.  

5. Think Long-Term  

While starting salary is important, remember that long-term earning potential should be the bigger focus. A degree might not pay off immediately, but if you’re strategic about your career, the rewards will come with time. According to a  Harvard Business Review study, top-performing employees saw their salaries grow by an average of  30% every three years .  

Conclusion  

While there is often a gap between salary expectations and reality, it’s not all doom and gloom. If you manage your expectations and make informed career choices, you can still achieve financial success. Remember, it’s a marathon, not a sprint. What matters most is that you stay informed, make strategic decisions, and be patient with your career journey.