Understanding the true out-of-pocket expense to obtain your degree:
Step 1. Start by Learning the Sticker Price of the Schools You Want to Attend
There are a few key terms you need to understand to master the financial aid process. Let’s start with Cost of Attendance (CoA). This is the “sticker price” and each school publishes its own figure on its financial aid site.
Cost of Attendance estimates the total cost of attending an MBA program each year and typically includes:
- Tuition and fees
- Estimated cost of course materials
- Health Insurance
- Estimated Room and Board (where you’ll live and what you’ll eat)
- Some allowance for personal expenses like travel (but less than many students typically spend)
Don’t let this figure scare you away because it is only a starting point!
We’ll touch on strategies to rescue the sticker price through financial aid and scholarships.
Step 2. Apply For Financial Aid
Once you’ve been accepted to a program (congrats!), you need to start thinking about financial aid.
Merit-based Aid: You’ll typically hear about merit-based aid as soon as you’re admitted. Think of this like a discount to tuition because the school really wants you to attend.
Need-based Aid: Fill out the application (through the Department of Education). Then fill out the financial aid application for each school that admitted you. Most schools will get back to you in several weeks with your Financial Aid Award Letter, which will be made up of grants and loans. Grants are effectively discounts (money that does not need to be paid back).
Step 3. Consider Negotiating Your Financial Aid Results
This is where things get interesting. Think of your financial aid award letter as a first draft as opposed to a finished product! If you really want to go somewhere and the cost after scholarships and aid is too high, try asking for a little more financial aid (seriously).
Many schools (but not all) are willing to increase the amount of aid they offer in order to get you to commit.
Why You Should Ask for More Financial Help:
- Many programs are already budgeting for this. They expect some portion of admitted students to appeal for more aid.
- Schools won’t rescind your acceptance just because you ask for more financial help (politely).
- If you aren’t the one asking, you can bet someone else in your incoming class is. The worst you can hear back is a simple no! But the upside can put you ahead financially after graduation.
There are two broad scenarios where asking for more aid can help:
You received Merit-based aid from multiple schools
Let’s assume you were admitted to two programs, A and B. You really want to attend Program A, but B offered you significantly more financial aid. It’s perfectly fine to let Program A know that you sincerely want to attend but just need a little more financial help. They may not be open to matching the aid from another program, but they could help bridge the gap.
Circumstances have changed since you submitted your need-based aid application
Maybe you omitted something from your original need-based aid application. Or some life circumstance has changed (growing family, changes in employment, etc.). Let the financial aid office know and ask if they can reconsider the amount of need-based aid for which you qualify.
Step 4. Apply to External Scholarships
Start exploring external scholarships as soon as you can!
Many MBA programs publish a list of external scholarships that students have applied for in the past several years. We’ve done our best to collect publicly available links to these resources for 52 MBA programs.
Step 5. Budget for Some Extra Expenses
We’ve found that a school’s estimate for cost of attendance is often a bit too conservative. The MBA experience is as social as it is academic, which leads the average student to spend approximately $10,000-16,000 more per year than the school estimates.
Where does that money go? Trips, campus clubs, conferences, dinners, and more. Once you’re on campus, especially at the beginning, it can feel like you have to take part in every activity you hear about (the FOMO is real). But not every event or trip is really worth stretching your budget for.
Comments