In January 2017 the FT reported that the average Stanford GSB student will spend around $218,000 over two years while giving up roughly $200,000 in earnings. Since most top programs cost more than $100,000 per year, completing an MBA can be one of the biggest investments of your life.
The FT also cites that on average, graduates of the world’s top schools double their pre-MBA salary within three years, which sounds like a reasonably good return on investment.
With tuition on the rise year-after-year, and no sign of tuition at top programs ever being lowered, what do you need to keep in mind while considering costs, and how to finance your MBA?
Savings
If you are in a position to save money for your education you should make aggressive efforts to do so. Try to adjust your spending downwards, and commit to saving an increased percentage of your income.
It helps to look at tuition and costs at your target schools in order to get a sense of how much you will need to complete the program of your dreams.
Scholarships
Many schools offer merit and other diversity scholarships to students that can be a tremendous help in alleviating the financial burden of an MBA. Stanford GSB offers the USA Scholarship for students with a strong focus on pre-selected regions in America, and the Partnership for Diversity Fellowship. INSEAD offers scholarships for Asian Women, as well as for applicants from many different countries. HBS offers fellowships for students who have had an outstanding track record in the nonprofit sector, or the life sciences. Last year ASU Carey offered the Forward Focus Scholarship, which covered the full cost of tuition for full-time MBA students.
Many schools offer scholarships to increase diversity in their class, or in order to attract people with uncommon, or exceptional backgrounds. If your story is a bit unusual compared to other MBA profiles, you may want to double check to see what scholarships are available at your target schools.
Loans
Traditional sources of student loans have been somewhat overtaken by startups in the student loan space.
SoFi offers generous terms for students, including an extended grace period for students undertaking entrepreneurial activities post-graduation. They offer competitive rates, and got their start by serving business school students. Prodigy Finance was founded by INSEAD alums, and has carved out a niche for itself serving international business students by offering loans without requiring a co-signor.
You could save significant amounts of money by investing a little time into finding the right loan provider, so be sure to understand the options available to you.
Loan Forgiveness
Many schools offer loan forgiveness for graduates entering the nonprofit or public sectors, including Yale SOM, HBS, and Stanford GSB. HBS also offers loan reduction for select students pursuing entrepreneurial activity, so be sure to read extensively through the financial aid pages of your target schools to see if you may be able to take advantage of loan forgiveness programs post-graduation.
Conclusion
You will likely have to consider multiple sources and options to finance your MBA, but it can be one of the best investments you ever make in yourself, as we have written about previously. It can sometimes feel a little overwhelming to figure out how to make your education work, and how to try to get as much financial aid and scholarship money as possible. If you would like help thinking through your options, feel free to reach out to us at Info@TranscendAdmissions.com any time.