Paying for grad school: A guide to funding your business degree

Thinking of pursuing an MBA or business master’s degree but daunted by the price tag? We are here to shed light on funding options. Getting clear on financing and developing a plan based on your needs and goals can help you control costs.

Funding Options and Strategies

When it comes to paying for your degree, first start by looking for money you don’t have to repay, and then, secondly, borrow responsibly if you have to.

1. Look for money you don't have to repay.

Money you don’t have to repay can be sorted into three categories: 

1. Personal savings
2. Employer support
3. Scholarships, fellowships, and assistantships

Personal savings

You may need to use savings to help pay for your education. Assess your current finances and determine how much of your savings you can and/or want to use for grad school. If you need guidance on how much savings to dip into or to create a savings plan, consider working with a financial advisor.

Employer support

Look into your company’s employer assistance programs if you’re currently employed. Your employer may cover some or all of your program’s costs in a tuition reimbursement or remission program. If your employer doesn’t currently offer any programs, you can still ask your employer for support.

At the Carlson School, we offer a tuition discount and expedited admissions to select programs and courses for employees of our partner companies. Learn more about the Carlson School’s Corporate Discount Program.

Scholarships, fellowships, assistantships

Many business schools offer scholarships, fellowships, and assistantships you can apply to during your application process or once you’ve been admitted.

Scholarships

Scholarships are financial aid awards for achievement that can cover part or all of your program’s tuition, fees, books and supplies, and/or living expenses. Scholarships:

• Don’t need to be repaid
• Are usually not taxable
• Can be merit-based, need-based, or have some other criteria
• Usually applied to your tuition directly

Check with the program you’re applying to for details and eligibility requirements.

At the Carlson School, graduate scholarships are merit-based and included in the admissions review process. This means you do not need to apply separately or meet additional criteria to be considered for a scholarship. However, our scholarships are first come, first serve. So apply to your program of interest as soon as possible for the chance to receive the best scholarship package possible.

Some community organizations and business associations also offer scholarships, such as the Forte Foundation, the National Black MBA Association, and Prospanica. Make sure to connect with your network to learn about potential financial support and scholarship opportunities outside of the school you’re considering.

Fellowships

Interchangeably used with scholarships, fellowships are financial awards that can support your studies, research, or some other opportunity. Fellowships:

• Don’t need to be repaid
• May be taxable
• May require a service commitment
• May be paid out as a stipend

At the Carlson School, we offer fellowships to Full-Time and Management Science MBA students to attend various affinity conferences. Fellowships are only awarded to admitted MBA students and there is a separate awarding process.

Assistantships

Some business schools offer assistantships, which means you’ll be working for the program and earning a salary or hourly wage. Speak to your school of interest about these opportunities.

At the Carlson School, graduate assistantships are offered at the program level and you must apply to be considered. If the program you’re interested in offers assistantships, details on applying for these roles will be provided as opportunities become available.

2. Borrow Responsibly

Loans can help you cover gaps in tuition, fees, and living expenses once you’ve considered and pursued all options for money you don’t have to repay. There are two options for borrowing money: 

1. Federal loans and grants
2. Private loans

Federal loans and grants

You may qualify for federal loans and grants if you are a U.S. citizen. You must first complete the Free Application for Federal Student Aid (FAFSA). There are several types of aid the U.S. government offers:

Submitting a FAFSA for a graduate degree usually means seeing if you qualify for a loan. Federal loans often have different interest rates and repayment terms than private loans. Additionally, if you decide to work in a nonprofit or for federal service after you graduate, there is an option for loan forgiveness if you received your loan through FAFSA.

Private loans

If you’ve exhausted all other options for funding your degree or do not qualify for the FAFSA, consider a private lender.

Personal loans are usually available through your bank or credit union and are based on your credit. The better your credit, the better your chance of getting a loan. You can get a fixed or variable interest rate. Talk to your lender for terms and repayment options.

If you’re an international student and do not qualify for the FAFSA or do not have a U.S. bank account, there are select vendors that will work with you. For example, Carlson School students in the past have seen success in qualifying for loans from Empower and Prodigy Loans.

For more financial resources, check out UMN Student Services.

Consider your goals and needs

Paying for your graduate business education can be overwhelming. 

Take some time to learn about the kinds of programs and learning options available. This can help you create a plan to fund your degree. For example, learn about the difference between MBAs and specialty master's programs. Knowing which degree is right for you depends on your career goals.

Determine how and when you want to learn. Beyond full-time programs, there are also part-time and online options designed for you to work while you learn. Learn about course modalities.

Considering these two aspects will help you identify the best program to meet your goals given your current situation. Once you’ve identified some programs to apply to, it’ll be easier to estimate the total cost (tuition, materials and fees, and living expenses) and a strategy to pay for it.

Lastly, if you have private or federal student loans from your undergraduate degree, you can consider getting them deferred while you’re in grad school. Be aware that while you can stop making monthly payments, they may still accrue interest. Contact your loan service to find out your options.

Reach out for support

Remember, you don’t have to navigate this alone.

• Consider working with a financial advisor to help you build out a plan to fund your degree and for professional advice and guidance.
• Reach out to admissions officers at your schools of interest to help you identify the best program for you, get your questions answered, and/or learn more about scholarship opportunities, etc.
• Tap into your network and community to connect with those who have advanced business degrees for advice and guidance.

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