Paying for your MBA can be expensive. Not only must you pay for tuition, books and living expenses while attending school, in some cases you may need to forego the salary you could be earning using the undergraduate degree you already have. This article explores some of the way that may hep you to overcome the financial hurdles of paying for your MBA.
With the cost of MBA programs ranging from a low of about $30,000 to a high of over $100,000, many potential students may be asking themselves if the financial sacrifice is warranted. Some studies have claimed that earning an MA has financial value only it if it is earned from a top-tier university. Stating that earning a degree from a lesser known school could result in a financial loss. Although this can, in some cases be true, it is important to remember that this is relative to your field. In any case it is a huge investment and therefore it is worthwhile, before getting into ways of paying for your MBA, to look at its monetary value.
Recent statistics on the starting salaries of graduates for four undergraduate fields that pay well can be compared with starting salaries of MBA graduates. The numbers are interesting:
- Bachelor of Science in Business – Starting salary $41,400; Mid-Career Earning $70,600
- Bachelor of Science in Accounting – Starting salary $46,500; Mid -Career Earnings $77,600
- Bachelor of Science in Paralegal – Starting salary $50,000; Mid-Career Earnings $75,700
- Bachelor of Science in Nursing – Starting salary $52,700; Mid-Career Earnings $68,700
A recent Wall Street Journal article described a study of starting salaries for 2010 MBA graduates in the US. Their median starting salary was slightly more then $79,000, not including a sign-up bonus with a median of about $13,000. The median is the middle value. That means that half of the graduates earned less then $79,000 and half earned more. We know that graduates from some of the top MBA programs in the US easily receive salary offers of $100,000 and higer. You ocan see that starting salaries of MBA graduates easily exceed mid-career salaries of undergraduates of the most lucrative fields. We can therefore assume that the MBA degree is worth attaining. The question then is, “How will you go about paying for your MBA?” Here are some approaches.
Paying for your MBA Yourself:
Most MBA programs accept students who have an undergraduate degree in any field and have worked in meaningful jobs for two to four years after graduating. People contemplating the MBA in their future should make every attempt to save as musch as possible during the years spent gaining work experience. Personal savings are an important part of financing your MBA education.
Paying for your MBA Through Your Employer:
Another vehicle is the job itself. Many companies encourage their employees to further their education and support this by offering tuition assistance programs. If you’re not sure if your company has a tuition assistance program, contact your human resources benefits department to inquire. If you are in the market for a new job be sure to take this benefit option into consideration when accepting offers. If a company does not offer a tuition reimbursement program you can often negotiate for this after an offer has been extended to you.
Often times such financial support requires that you continue working for this employer after attaining your degree, at least for a specified time period. This is also negotiable. Financial assistance from your employer typically means earning your degree in a part-time program. Part-time study can also be financed by continuing to work as a means of paying for your MBA. This often causes the degree to stretch over a longer period of time. It is not surprising that so many schools offer part-time MBA evening programs. They are filled with students with full-time day jobs, whether or not the employer provides any financial support.
For students wanting full-time study but do not have the personal saving or employer support, an obvious source of financial aid is a scholarship or an assistantship. Many MBA programs offer financial aid to qualified students, usually based on merit, in the form of reduced tuition. This at time requires the student to perform some work while studying. The work may consist of assisting a professor with research or clerical tasks. An assistantship can in itself constitute an important part of the education process.
Paying for your MBA With Loans:
A last resort of financing consists of debt. Many student depend on loans from family members, family businesses, private sources, government loans or student loans from private lenders. The assumption is that the MBA will lead to a well-paying job, which will afford you the opportunity to repay the loans.