Business school alumni consistently tell us that pursuing a graduate management degree was personally and professionally the right decision—a gateway to their future, worthy of the investment of time and money required to advance their career goals and open the door to new opportunities. But paying for school can certainly seem daunting, especially in this post-recession economy. As you consider which graduate program is right for you, keep in mind that you have many financing options available. Here’s what we’ve learned:
Develop a Financing Strategy
It helps to take a pro-active approach to developing a strategy that works for you and your family, and that aligns with your career aspirations. No one formula is right for everyone.
Prospective students have told us that loans, grants, fellowships, and scholarships, followed by personal earnings and savings make up the bulk of financial resources they plan to tap to finance their education. To put your situation in perspective, it may help to know that over the last two years, a typical graduate b-school student, on average, expected loans to account for 30% of the cost; personal earnings or savings, 21%; grants, fellowships, and scholarships, 19%; employer assistance, 18%; and parental support, 9%.
Breaking down how students plan to finance their degree on a global level, there are wide differences by region. As this figure reveals, loans constitute the largest source of financing for prospective students in Central Asia (36%) and the United States (30%); whereas personal earnings or savings play a big role for funding for residents of Canada (35%) and the Middle East and Africa (34%).
Match Your School to Your Financial Needs
Keep in mind that the level of financial aid you can anticipate receiving may depend on where you apply. According to our 2011 survey of graduate b-schools tracking application trends, scholarships are the most common form of tuition assistance in the United States, where 42% of incoming 2011-2012 students to all program types expect to be offered a scholarship, compared to 25% of students attending non-US programs. On the other hand, 52% of students who enroll in programs outside the United States will be offered loans from the school, whereas only 38% of incoming students to US programs expect such loans.
One easy way to find schools that meet your academic and financial criteria is to visit the mba.com School Search Service . Our online database of more than 1,000 programs is searchable by total program cost and financial aid, as well as by the traditional dimensions of program type, academics, class profile, and location. But remember to consult with those best equipped to advise you, including your school, your financial advisor, your family, and your employer when researching potential funding sources. You might be surprised by the options available!
Keep Your Eye on the Prize
A graduate management degree is all about future value and benefits. Look no further than recent b-school alumni. Their return on investment in a graduate business degree paid off in immediate employability (nine in 10 members of class of 2010 had jobs upon graduation). For more information on planning for b-school and making sure you are financially ready for the big step ahead, see “Figuring Out Your Finances.
-Research Center at GMAC