The decision to embark on an MBA is one of the most important of your career. The experience will sharpen your business skills and will open the door to new and exciting career opportunities in the future, but at what cost?
An MBA is a big investment, with tuition fees varying considerably (depending on the business school’s pedigrees) from £7,500 at the University of Wales Trinity St David to £87,900 at London Business School. Of course, there are also living expenses to consider as well.
With these costs in mind, most people looking to study for an MBA will be faced with two crucial questions: ‘How do I fund it?’ and ‘am I willing to take on the risk of doing an MBA given the financial commitments?’
The funding dilemma
This is one of the most important parts of the whole MBA process. The consideration of these questions and then coming up with the answer, ‘Yes, I can find a way’, and ‘Yes I am willing to take the risk’, is all part of the self-development process of getting into a business school and having a successful outcome.
There are risks involved but finding a way around these challenges is an excellent introduction to what you will be doing for the next 20 to 30 years of your career. People who take on personal debt to do the MBA are indeed taking a big risk. For example, one never knows what the economic climate and job market will be like at the end of their MBA – COVID being a prime example of how things can change dramatically. Yet the ability to take on and manage big risks is one of the attributes that top business schools, future employers and indeed Engineers in Business Fellowship, is looking for in candidates.
To cover the cost of an MBA – particularly in the absence of full-time employment, savings or help from family members – it is critical that prospective students thoroughly research the potential sources of funding available.
Research what help is available
The key to resolving the question, ‘can I fund an MBA?’, relies on extensive research. There are many different options and opportunities, so it is essential to find out which is best for you. Unearthing this information involves intensive desk research, not a one-hour Google search. The process could take as much as eight hours of exploration over several days, weeks or even months.
What can you offer?
Competition is stiff for MBA scholarships so you will need to demonstrate in your application that you have the skills and experience needed to succeed on a demanding MBA programme, that you have clear goals post-graduation and how you intend to contribute to society.
As part of your research and planning, you should go through a period of introspection and ask yourself the questions that a grant-giving or financial institution will want to know. The typical questions you could ask yourself are ‘who am I?’ and ‘what do I have to offer?’, ‘What makes me special?’, ‘What traits, attributes and experiences do I have that make me different or stand out?’, ‘What have I done in the past that makes me special?’, ‘What will I do in the future that will make a difference in society?’. In essence, what will impress and convince a grant or loan giving body that you are worthy of the investment?
Some of the main characteristics that universities and funding bodies will be looking out for when assessing scholarship applicants include leadership potential, evidence of entrepreneurship/intrapreneurship, track record of innovation and a proven commitment to a particular sector.
Once you have an idea of what differentiates you from others, you can start thinking about who can help you achieve your potential. There are many grant-giving bodies, so it is essential to research them all and understand their perspectives. However, there is no point tracking down these funds unless you can answer the questions about why they should award you a grant (or a loan from a financial institution). You must match what they are looking for with what makes you stand out.
Choose the right funding or mix of funding
The funding options have different terms, conditions and requirements and they can be quite complex. Below are a few categories of funding sources; for more information, these articles are a good starting point – Findamasters and Figmat.
Part-time study while working
Part-time study is a relatively common option for MBA degrees. Many programmes are intended to be completed by practising management professionals and some courses set tasks for students to apply within their workplace. A part-time MBA could therefore be a great way to study while continuing to earn a salary. The UK Government’s postgraduate loans are available for part-time masters. The amount you borrow will be divided evenly across the duration of your MBA programme.
Before the 2008 financial crisis, several banks in Europe and the US offered loans tailored to MBA students. Following the withdrawal of many banks from the MBA lending market, choice has been limited, particularly for international students. In the UK, there are few tailored MBA study loans offered by high street banks, leaving higher interest personal loans as the predominant option for bank borrowing (see Figmat).
An MBA could represent an attractive investment for your employer. After all, these programmes are aimed at enhancing the skills of experienced business professionals and developing advanced leadership skills that could prove invaluable in a current employer. You will need to persuade your employer that sponsoring your MBA would be worthwhile for the company as well as your continuing professional development. Some employers may contribute towards the cost of an MBA, providing that you are willing to commit to returning after graduation.
Scholarships and bursaries
There are many different scholarships and bursaries aimed at helping talented prospective MBA students get their dream qualifications. Most universities and business schools run funding schemes to attract the brightest and best applicants from all backgrounds. According to the Financial Times, 54% of students who graduated from a ranked USA MBA programme in 2010 received some form of financial assistance from their school or an external source. Among their peers who studied in Europe, 31% received such assistance.
Scholarships are also offered by various organisations and institutions from across the world. For example, Chevening scholarships are offered by the UK Government to help talented international postgraduates study in the UK and our own Sainsbury Management Fellows £50,000 scholarships are available for engineering graduates from the UK, EU, and EEA to study an MBA at 14 of the top international business schools.
It is worth noting that institutions that offer money only have a limited pot each year. Some of these schemes waive a portion of the fees, while others are cash positive, helping with living expenses as well. Some schools have specific grants for certain demographics, for example, widening participation schemes. You will need to know which demographic you fit into, whether you are part of a minority that can gain additional support. So, you need to look at both the macro and micro levels when researching. Remember that it is possible to apply for multiple grants from different institutions. Some grant authorities may well be inclined to support an applicant because having one grant already shows that their decision to support a candidate is a good one because another body is already investing in that person.
Thankfully, there are many grants, loan schemes, fee waivers and other forms of assistance to help people to fund their MBA. The most important thing is to find what is right for you. Once you have done your research, look at the big picture, consider how you fit into the offerings by defining your special qualities and then leverage that to come up with what works best for you. Most of all, invest as much time as you possibly can to track down the many sources of funding. The time may pay off in the end and help you to achieve your ultimate goal.
About the author: SMF David Falzani MBE is President of Engineers in Business Fellowship and a Professor of Practice in Sustainable Wealth Creation at Nottingham University.