Which MBA Funding Source is Right for You?
Getting your MBA acceptance letter is a once-in-a-lifetime experience. But submitting your deposit for business school is a thrill of a different kind. After you decide where to attend, you’ll only have a few months to get your finances in order. It’s never too early to assess which MBA funding source makes the most sense for your unique circumstances.
Scholarships and fellowships:
It’s worth noting that scholarships for MBA students have increased recently. About 20-25% of SBC clients receive scholarships ranging from $10,000 to full-ride offers valued at $200,000. Also, we have had countless clients who received merit scholarships from 2+ schools upon admit notification.
Your application quality on its own could invoke a windfall of scholarship dollars. Diligence and strategic planning in developing your MBA application can pay off, as we mentioned in Find MBA.
Remember, fierce competition for these scholarship dollars means you’ll benefit from having the time to build a strong pitch for why you deserve a coveted spot in the program.
The key is to know your niche relative to the cohort in which you’re competing. Then, identify and showcase ways you are unusual within your industry’s applicant pool. The savviest students receive multiple offers and can leverage them to negotiate a larger offer.
The process of finding, applying for, and sorting out MBA financial aid opportunities can be tedious and confusing. Did you know that SBC offers a financial aid advisory service for accepted MBA applicants? Learn more about this exciting resource here.
Female MBA applicants should check out this listing of the top MBA scholarships for women. “Although more women are applying to MBAs than ever before, just 39 percent of full-time MBA students at the world’s top-ranked business schools are women,” writes Bethany Garner of BusinessBecause. “To help redress the balance, business schools and other institutions offer targeted MBA scholarships for women.”
- Chicago Booth offers women applicants the Wallman Fellowship for candidates who demonstrate outstanding leadership and a commitment to advancing women in business. Women from underrepresented minority groups are preferred for this full-tuition award.
- London Business School has four distinct scholarships dedicated to increasing women’s representation in the C-Suite pipeline. Garner notes that all women offered a spot in the MBA program are automatically considered for these scholarships.
- INSEAD also has several scholarship opportunities exclusively for women: the Groupe Galeries Lafayette Endowed Scholarship, the Judith Connelly Delouvrier Endowed Scholarship, and the INSEAD Piet and Wina Van Waeyenberge Endowed Scholarship for female engineers.
Also, remember that you may have to submit a different application or essay for each fellowship or scholarship. Look beyond your business school, too, to organizations such as the Forte Foundation or Consortium for Graduate Study in Management. Both offer valuable scholarships for MBA students.
If you’re one of the lucky few with a sponsorship offer, make sure you know what you’re getting into before you accept this MBA funding source. Sponsorship often comes with an obligation to return to the company after you complete your degree.
Thus, you’ll want to take a step back and assess whether you’re confident you wish to return. Breaking such an agreement after you earn the degree can lead to strained relationships with former colleagues. It can also leave you with a mountain of unforeseen debt.
If you plan to return to your company but don’t have sponsorship, it never hurts to ask about options. See if you’re eligible for any reimbursement, given the new skills you’ll bring to the table.
This less obvious MBA funding source comes with a few extra considerations. First, you should always think hard before touching funds set aside for retirement. But those who have saved aggressively already and plan to continue doing so may find it worthwhile to take some money out for the short term.
You’re exempt from the 10 percent penalty for early withdrawals when you put the funds toward qualified higher education expenses, of which attending business school is one. You’ll still face income tax on this money. But the tax burden will likely be less when you’re in a graduate student tax bracket.
The U.S. government offers at least two loan options for each academic year: the Stafford Loan and the Grad PLUS Loan. To tap into this MBA funding source, you can apply for these loans online via the Free Application for Federal Student Aid. Also, the Department of Education is an excellent resource for information on rates, fees, eligibility, and more.
Nerd Wallet recently published a roundup of their favorite federal and private MBA student loan options for 2023. Check out their recommendations as a jumping-off point.
When you’re looking for the right loan, it pays to shop around. Find a lender you trust at an interest rate you like. Private loans can provide customized options to help you save, sometimes at rates even lower than the federal government’s. If you’re looking to augment your other MBA financing, seek a lender with excellent customer service and ask about what loan options can maximize your savings. For example, the Sallie Mae® MBA Loan is available with a fixed or variable interest rate.
Finally, use an online MBA student loan calculator to organize your costs and see how loans with different interest rates can work in your favor. Your MBA is a significant investment. Make the best use of the months ahead to ensure you have all the funding you need.
Jodi, SBC’s Director of Financial Aid, works one-on-one with each admit, identifying their financial needs and transferring that information with the admit to their financial aid application. If you have already received the admit to your dream MBA program and would like help with applying for financial aid as a US or international candidate, we are here for you!
“I have heard back regarding FinAid as well! GSB offered me $50K per year, so $100K in total and HBS is not final yet, but they have forecasted $47K per year as well, $94K in total. So, really great news.”