We admit to being DownerSnark when the subject of MBA scholarships comes up.
Mostly it’s because it’s….one of those things. Where applicants are often woefully misinformed or unaware of the realities of the situation.
If you’re applying for a graduate program in many other fields, there is a significant amount of free money available. That’s how society gets smart people to go research important things. If there weren’t funding for, say, archeologists and sociologists and all those other -ologists who are ologisting all over the place to advance human knowledge, then only the exceedingly privileged would be able to go do it. (As it is, you still have to be very privileged to be able to go for higher ed, but that’s a totally separate post for another day.)
But the MBA? There’s a very high ROI on this here degree.
We covered this good-news/bad-news situation quite directly in the post from the ‘snarchives called They are not going to pay you to get an MBA.
Today we’ll just burst your lil ol bubble with some Truth: Yes there is free money available in the form of scholarships and fellowships to help support you in your MBA dream, but you cannot assume you’re gonna get any.
The GMAT people did a survey of MBA applicants and here’s what folks were assuming for how their graduate business degree would be funded:
The only category on that whole chart that resembles reality is the last one, where applicants have some corporate sponsorship lined up and their job is going to pay for their schooling. If you’re getting sponsored, you know it, and you probably know about how much you’re getting, or at least a ballpark.
The other category that’s showing a more realistic percentage is the Parental Support one, particularly for those younger applicants who are going to bschool very early on in their lives and they have their family behind them to make the investment.
But for that first bucket?
Yes certainly there are many applicants who are accepted by great schools who get significant support from the school. That money comes almost entirely from alumni donations; it’s the generosity of grads from that school who want to pay back. When you go to Harvard and you become fabulously wealthy later in life, then you can get a nice tax write-off for your donation (or at least, you used to get one; who knows if that’s going to hold true as it once did now that we’re post tax reform). It’s a little ironic that the school that’s one of the most expensive is also the one with the deepest pockets and ability to help its students out.
Which is an important point to be very aware of: The further down you go in the rankings, there is often less money available for the schools to give away. All schools have the ability to award something but it’s definitely not the same situation everywhere you turn. There’s also usually less money available for an Executive MBA track, though we’ve more recently heard of a few EMBA programs that have been able to offer more fellowships.
If you’re aiming for a Top 20 school, then your entire focus should be on earning an admit. That alone is going to be plenty of a reward! If you have an especially unique background or are coming from a particular country where there are special-focus scholarships available, then certainly you may win the double prize. But please do not assume you will get anything more than the acceptance. Start planning NOW for the costs of the MBA. Save those pennies. Cut down on your expenses today. And consider the big-picture strategy. If getting financial help for your degree is a critical factor that determines whether or not you will be able to attend, then make sure you’re putting a full-spectrum strategy into place, and make sure you’re operating in the realm of reality on how unique or differentiated or distinctive your background is (especially compared to the list of targets you’re planning for), so that you might be able to accurately hope and pray for free money.
If the free money comes, then that will be FABULOUS! But if it does not come, does that mean you won’t be going to bschool?
Having this conversation with yourself now is super important. It would suck to get all the way through this process and be sitting on a win when Round 1 closes at the end of the year, but with no way to actually afford the tuition. The schools publish this information and have lots of planning resources available. Now is the time to be looking at this, when there’s opportunity to adjust plans and create the right strategies. Given the incredible ROI of a top tier MBA, it’s highly likely that the category “Personal Earnings” will end up being a greater than 13% contribution to paying off the bill. And that’s OK! It’s the whole point of getting the degree in the first place, isn’t it?
You want to get an MBA to get a better job and participate in the capitalistic society which will reward you handsomely. Sure, you may have a “make a difference” mentality and want to use the MBA for good things. But for many, many MBA grads out of these top-top schools, a six-figure salary will be easily had. No, the MBA is not affordable if we look at it rationally, but that six-figure salary means that yes, actually, you will be well set up to afford to pay off the investment you’re making in yourself. Spend some time planning things out now and facing the reality of the price tag, and figure out how you’ll manage to pay for the application process itself, and go into it clear-eyed and rational. And sure, it’s possible you’ll get some scholarship help too, if you aim for the right schools and you have the right elements in the profile to make them truly want you. Just don’t assume it’ll happen that way. Assume you’ll be on the hook for the full package. That’s a shocking amount of money to look at up front, but the payoff later on should well take care of it.