When you’re aiming for a successful career in business leadership, having a Master of Business Administration (MBA) degree can be incredibly helpful. However, earning an MBA means going back to school and paying tuition and other fees. If you’re worried about the cost of MBA degree programs, keep in mind there are several ways you can pay for school. Learning more about MBA tuition costs, as well as different payment options that might be available to you, can help you figure out how to afford your degree. Keep the following information on how to pay for MBA degrees in mind when deciding if you want to go back to school.
How Much Does an MBA Cost?
The cost of an MBA can vary considerably, depending on the school you attend and your enrollment status as a part-time or full-time student, among other factors. According to MBA Today, the cost of MBA degree programs can fall between $55,727 to $161,810 overall. Top-ranked schools, including private and public schools, typically cost more than other schools. The kind of MBA program you’re in, such as a fully online program or a traditional in-person program, can also affect how much you end up paying. When comparing schools for your MBA degree, you should take those factors into consideration, along with your budget.
Is It Better to Go to a Top-Ranked School or a Less Expensive One?
This depends in part on your personal preferences and budget. Going to a top-ranked public or private school for your MBA can cost significantly more, leaving you with higher debt when you graduate. You can earn a high-quality MBA at a less expensive school while developing the skills needed to be a business leader. Attending a top-ranked school also doesn’t necessarily guarantee you’ll land a higher salary after graduating to help you pay off student loan debt.
Is an MBA Worth the Cost?
An MBA can be well worth the cost of going back to school. Many employers prefer hiring candidates with an MBA over those without one, especially for top executive positions and other leadership roles. An MBA can open up more job opportunities for you while also giving you an advantage over other job seekers. With an MBA, you’ll have the skills and leadership ability employers look for when filling management positions. An MBA program helps you develop these skills and gain valuable knowledge about different aspects of business leadership.
Types of MBA Loans
Students who need to pay for MBA degree programs without having the funds to do so can look into taking out an MBA loan. These student loans cover the cost of your tuition, allowing you to earn your MBA and pay back your loan balance over several years. Different kinds of MBA student loans are available, so it’s important to do comparisons and apply for the type that works best for you.
Federal loans from the government can provide you with a way to pay for your MBA degree. These loans often have fixed interest rates, which can help keep your payment amounts from changing. With federal loans, you can also explore options, such as income-based repayment plans, to bring payment amounts down. Keep in mind that federal loans can take many years to pay in full, depending on your balance and monthly payment amounts.
Private MBA Student Loans
Private MBA student loans are another payment option to consider for your degree. These loans are available with fixed or variable interest rates, as well as other options for repayment. Private student loans sometimes have lower interest rates for students who have excellent credit, which can help keep payments down. As with federal loans, you’ll need to repay your loan plus interest after you graduate, which can take several years.
Refinance Your Undergrad Student Loans
If you’re paying back undergrad student loans, lowering the amount you pay each month can free up money to put toward your grad school degree. Refinancing your undergrad student loans can lead to lower payments, as long as you have good credit. Keep in mind that the better your credit is, the lower your refinanced interest rate should be. With lower interest rates and lower payments, you should be able to pay off your undergrad student loan sooner.
What About Student Loan Forgiveness?
Some individuals can have their federal student loans forgiven under certain circumstances. These loans can be forgiven, cancelled, or discharged in specific situations, such as when a school closes or after making a certain number of payments while working for a non-profit or government organization. Several types of student loan forgiveness options are available, such as Teacher Loan Forgiveness, Perkins Loan Cancellation and Discharge, and Public Service Loan Forgiveness. Having your undergrad student loan forgiven can put you in a better financial position to pay for your MBA degree.
MBA Scholarships, Fellowships, and Grants
While loans require you to repay the balance, other options cover all or most of your MBA tuition without requiring repayment. MBA scholarships, fellowships, and grants do not need to be repaid after you graduate, so you might want to explore these options before taking out a student loan. You can check with schools, local and state organizations, and private organizations for available MBA scholarships, fellowships, and grants.
Employee Education Benefits
Your company might provide options that help cover the cost of your MBA education. Employee education benefits sometimes cover all or some of the cost of earning an MBA when an employee goes back to school. Keep in mind that you’ll most likely need to look for a part-time MBA program if you’re a full-time employee. In many cases, employers require employees to stay with the company for a certain number of years after earning an MBA if employee education benefits are used.
Corporate sponsorships can help you pay for your MBA program. You can look into this type of sponsorship if your company doesn’t offer employee education benefits. You’ll need to convince your company or corporate sponsor that covering all or some of the cost of your MBA degree is a smart investment on their part.
Tuition Assistance or Reimbursement
Some companies offer tuition assistance or reimbursement when employees go back to school to earn an MBA. In this case, companies provide financial assistance for MBA programs or reimburse employees for the cost of tuition and other fees. Keep in mind that you’ll need to pay for your MBA, then rely on your employer to reimburse the cost if you take the reimbursement option.
Federal Work-Study Program
If you’re looking for ways to cover the cost of your MBA, a federal work-study job might be a good option. These positions allow you to work part-time, on campus or off-campus, during your enrollment in order to earn money that you can put toward tuition and other costs. Both part-time and full-time MBA students can explore options for work-study jobs.
Teaching or Research Assistant
Working as a teaching or research assistant can provide you with stipends or fee waivers that you can use for your MBA education. These assistants provide faculty and other staff with help as needed, such as grading tests, distributing school materials, and handling educational activities. If you enjoy working with students or working in education, this can be a great option to explore when looking for ways to pay for your MBA degree.
If you have served in the military or if you’re active-duty military, you may have options for military benefits that can be used toward your MBA degree. These benefits can help cover all or some of the cost of your MBA tuition and other expenses.
If you don’t want to rely on loans and have the funding available to cover the cost of your MBA education on your own, consider a self-funded MBA. When you self-fund your MBA, you’re typically paying for it without help from lenders, the government, or other sources. A self-funded MBA can be the ideal option when you have enough money and want to avoid having to take out any loans for your education.
Tuition Installment Payment Plan
A tuition installment payment plan allows you to pay for your MBA program over time rather than all at once. If you don’t have enough to fully cover the cost of tuition when starting school, you might be able to work out an arrangement that lets you make multiple payments over the course of a semester. With this kind of plan, you can pay for your MBA degree without having to rely on student loans.
If you have enough saved up in your bank account, you can use your savings to cover the cost of an MBA degree. Paying for school upfront in one lump sum means you won’t have to worry about making multiple payments or finding other ways to finance your education. If you plan on going to MBA school soon, consider setting aside money in savings until then.
Crowdfunding involves asking others to help pay for your MBA degree. Several platforms are available for crowdfunding, so you can raise money to cover all or some of the cost of your tuition. Keep in mind that you’ll need to give other people good reasons for contributing to the cost of your MBA degree if you go this route.
You might be able to use tax credits to help cover your MBA tuition cost if you’re eligible. For example, a 529 State Income Tax Credit or a Lifetime Learning Credit can help you afford to pay for your MBA degree. Since these tax credits have certain eligibility requirements, you should check with a tax expert to see if you qualify. Using tax credits can help lower the amount you need to pay for your MBA degree.
If you’re looking for a college that offers financial aid options, scholarships, and other ways to pay for your MBA degree, contact the Gary W. Rollins College of Business at The University of Tennessee at Chattanooga. We can provide you with more information on payment and financial aid options for MBA students, as well as information on our admissions requirements.