An MBA is a surefire way to propel your business career to new heights. For those of you interested in getting an MBA, it can be hard to find the right source of financing. This article delves into some useful methods of financing an MBA. Before doing that, let’s understand what an MBA is all about.
About the MBA
The Master of Business Administration (MBA) degree is a highly coveted and internationally accredited program that covers several business principles such as economics, marketing, finance, accounting, and more. An MBA prepares you for the business world as a high-level business manager and teaches students invaluable business skills.
An MBA also provides the opportunity to learn from world-class professors who tend to be pioneers in their field. The peer group within these programs are like-minded such that you can network with fellow entrepreneurs and future business managers. Most MBA programs take between 1 and 2 years.
Keep in mind that many MBA programs have the potential to skyrocket your career opportunities. The management skills taught during an MBA can be invaluable to your utility for a company, and it makes you a much more attractive hire. During the program, you can enhance your social skills and build up your network of friends — many of whom may end up being future CEOs. The entrepreneurship values and in-depth knowledge of your chosen area of expertise can propel you, as a person, to new heights.
An MBA program can be very expensive. The average MBA program is about $40,000 to $50,000. If you’re going to a top-tier school, you can expect to pay $90,000 or more for tuition alone. Attending a top-tier school (top 20 or top 30) for your MBA is great because the name of the school comes with a lot of brand recognition.
Great schools like Wharton or Harvard are instantly recognized by employers and have the potential to greatly increase your employability. At a name-brand school, you’ll also have a much more talented group of peers, since the selection criteria for the program tends to be very strict. The professors and coursework that you will encounter will also be of the highest possible standard.
There’s always the option of going for a less-recognized MBA program. You will likely gain a similar set of skills (albeit at a lower level) and you likely won’t be taught by professors who are pioneers in their field. The peer group you associate with likely won’t be of extremely high calibre since the admission requirements tend to be lower.
The program would also be less recognized so there’s a risk of becoming employed at a worse firm or for a lower salary after the program is over. On the bright side, such programs can be a lot cheaper. You can potentially save tens of thousands of dollars, which can be a huge deal if you’re not currently working or you don’t have a lot in savings.
In order to ascertain the right type of MBA program for you in terms of cost, it’s good to look at the average graduate salary. After 4 years of work experience, most MBA graduates make around $60,000 per year, with which it’s easy to pay off tuition costs for a medium or low-level MBA program. People who graduate from top 10 MBA programs can make up to $180,000 in their first year alone, which is a massively better return on investment. Graduate salary trends show that the ROI of a top 10 or top 20 MBA is comparatively much higher than that of a medium-level MBA.
Of course, all of this is only relevant if you have the means to afford an MBA program from a top school. Financing a top-level MBA program isn’t the easiest thing in the world, because, as discussed earlier, you need access to a sufficient amount of funds. There are some ways to finance your MBA which you may not have previously considered, though.
Financing an MBA: An Employer-Centric Solution
The best way to finance your MBA without necessarily having to pay for it is by getting the support of your employer. If you’re already hired in a company that you like and see yourself having a future in, this is an excellent idea as it can save you quite a lot of money.
Before broaching the topic, be sure that you have a good sense of the company culture. Most of such programs involve you guaranteeing that you will remain with the company for at least 2-3 years, so if you don’t love the company already, this may not be the best idea. Additionally, take stock of whether or not the company has available funds to partake in such a problem. If there’s financial turmoil going on within the company then it would be best to wait until it passes before bringing up the subject.
Once you have decided that you would like to attempt a request like this, keep these pointers in mind:
Be Specific With Your Request
Know exactly what program you want to do, how long it will take, and how much you expect your employer to fund. If you’re not sure of yourself, then your chances of being approved will decrease.
Articulate Your Value to the Company
For this, it’s best to already have been a very good employee. If you already do excellent work, then it’s a no-brainer for the firm to want to upgrade your skills. As long as you can prove that you can make the company more money than they will have to spend on the degree, you won’t be turned down.
Think About Peripheral Benefits
Are there other things about the arrangement that your employee can benefit from? Maybe the prestige boost of having a manager from a name-brand school? Or it could be a massive tax deduction. Plan ahead and think of these things, and present them to your senior in an organized manner.
Personally Financing Your MBA
For a myriad of reasons, getting an employer-financed MBA may not be possible. Maybe you’re not employed, or maybe your firm just isn’t big enough yet. Most MBA program students are faced with the challenge of funding their own MBA, which can be a daunting task especially if you don’t already have a job. Here are some of the most common ways to finance your MBA:
Personal or Family Finances
If you have money saved up from a job, then this can be a great place to deploy it. It may be hard parting with your hard-earned savings, but it’s for a good cause — investing in yourself and leveraging your skills into a higher paying salary. You can also ask your family for assistance if you are in such a position.
Scholarships and Bursaries
Many public institutions, private organizations and governments offer a wide array of scholarships just waiting for the right applicants. Apply for as many scholarships/grants as possible to increase your chances. These can heavily subsidize your overall tuition, making the ultimate out-of-pocket cost significantly lower. If your school itself offers scholarships, be sure to apply to those — there’s a chance you can have your entire program paid for by the school!
Student Loans or Credit
You may not readily have access to funding, so student loans are a great way to get exactly as much as you need. You can even take out a line of credit for things like books, housing, and living expenses as well as tuition costs. Loan programs made specifically for students come with special interest rates and extremely long repayment timelines that range from a few years to several decades. If your MBA program pays off as expected, then paying off a loan would be a trivial matter since you would be earning several times the monthly payment.
Credit Excel Capital is one of the best places in Singapore to get funding for student loans and student lines of credit in order to fund your MBA. They are a licensed money lending organization, and they make the process of applying for a personal loan quick and easy. Credit Excel Capital has no credit limit on secured loans, which means if you have sufficient collateral, you can take out as much credit as you want.
Based on your annual income, you can take very large loans — in some cases, you are even given access to a limitless line of credit even without collateral. If the student loans or credit method is the MBA financing method that looks right for you, Credit Excel Capital is one place to look for. Do feel free to contact us if you would like to apply for a loan.