The decision to pursue an MBA program or graduate degree is one of the most significant investments in someone's education and professional development. Yet, amidst the pressure of case studies, network building, and internships, personal finance often takes a backseat.
Having a solid financial plan helps you strategically pay off your debt, save for the future, and invest in yourself. Here are some tips to help you manage your finances while pursuing an MBA or graduate degree.
🎓 Unique financial situations of MBA students
When you’re already employed
Some students choose to pursue an MBA or graduate degree while working full-time, which can present a unique set of financial challenges. In addition to the added expense of tuition and fees, students may also need to balance their existing work responsibilities with study time.
Here are some tips to help you navigate this situation:
- Create a budget that accounts for your living expenses, tuition fees, and any potential changes in your income.
- Consider talking to your employer about potential tuition reimbursement or sponsorship opportunities.
- Be mindful of the added time commitment and prioritize tasks effectively to maintain a healthy work-life-study balance.
When you’re taking a break from work
Some students may take a break from their careers to pursue an MBA degree, which can lead to a change in income and financial stability.
- Take advantage of scholarships and grants offered by the school or external organizations to help cover tuition costs.
- Consider taking up part-time work or freelancing opportunities to supplement your income and gain valuable experience while studying.
- Be mindful of your expenses and create a budget that accounts for any changes in your lifestyle during this time.
💡Practical personal finance tips for MBA students
Strengthening your financial literacy can help you make informed decisions and manage your finances effectively while pursuing an MBA or graduate degree. Here are some tips to consider:
During MBA
1) Know your disposable income
This is especially important when taking a break from work or having a reduced income while studying. Knowing your disposable income can help you make smarter choices with your spending, such as cutting back on unnecessary expenses.
2) Create a budget
Be realistic when creating a budget, and be sure to include all your expenses, such as rent, groceries, transportation, tuition fees, textbooks, etc. Use budgeting apps or spreadsheets to track your spending and stay on top of your finances.
3) Pay yourself first
Set aside a portion of your monthly income to prioritize saving and investing in yourself. This can help you build an emergency fund, save for retirement, or cover unexpected expenses.
4) Settle bills on time
Late fees can add up quickly and negatively impact your credit score. Set reminders or automate payments to ensure you pay all your bills on time.
5) Limit and reduce personal debt
Avoid taking on more debt than necessary and pay off any existing debts as quickly as possible. Consider consolidating loans or creating a repayment plan to manage your debt effectively.
6) Take advantage of student discounts
As a student, you may have access to various discounts on services and products. Take advantage of these offers to save money wherever possible.
7) Inquire about corporate discounts
According to the Society for Human Resource Management (SHRM), 48% of employers offered undergraduate or graduate tuition assistance as a benefit. The Secure 2.0 Act has also made employer-funded education tax-free up to $5,250 per year.
If you're part of the workforce, you can inquire about potential corporate discounts or tuition assistance programs to help offset the cost of your MBA or graduate degree.
8) Monitor credit score
Your credit score affects your ability to get loans, credit cards, and even rent an apartment. Try to spend below 30% of your credit limit.
9) Plan for your post-MBA finances
Start thinking about your financial goals and plans after completing your MBA or graduate degree. This can include paying off any remaining debt, saving for a down payment on a house, or investing in your career.
You can also start applying for job opportunities or networking with potential employers to secure post-graduation employment.
Post MBA
1) Work on reducing tuition loan
Allocate some of your extra income towards paying off any high-interest debt and student loans. Paying your loans ensures you maintain a good credit score, essential for big purchases like home and auto loans.
Consider options such as income-based repayment plans or loan forgiveness programs.
2) Save on tax returns
Take advantage of the American Opportunity Tax Credit, Lifetime Learning Credit, and Student loan interest deductions during tax time to save thousands on your tax returns.
3) Get insurance coverage
As you get older, the costs of health care, long-term care insurance, and life insurance all go up.
If you still haven't, get them while you’re young and healthy to lock in a lower rate. And if you already have insurance, talk to your financial advisor to check for sufficient coverage.
4) Plan for your future
It's never too early to start planning for your future.
Consider putting money into a retirement plan like a 401(k), IRA, individual stocks, bonds, or annuities. Talking to a financial advisor is recommended to determine the best options that match your financial goals.
🔎 Available MBA scholarship grants to apply for
MBA scholarships can significantly impact your financial situation while pursuing your degree. Here are some scholarship opportunities to consider:
▶️ General Scholarships for MBA Students
Mary Elizabeth Lockwood Beneventi MBA Scholarship
The Mary Elizabeth Lockwood Beneventi Scholarship is awarded each year by the Daughters of the American Revolution to full-time students working towards an MBA. It's open only to US citizens. Since the scholarship doesn't renew automatically, winners must reapply yearly.
Government Finance Officers Association (GFOA)
GFOA provides several scholarships for graduate students. They particularly welcome applications from finance majors aiming for careers in government finance.
SHRM Foundation Scholarships
SHRM Foundation Scholarships are for students studying human resources or related fields such as business, economics, organizational development, or psychology. It's a one-time scholarship, but those who have won before are welcome to apply again.
The Consortium for Graduate Study in Management
The Consortium provides merit-based fellowships to underrepresented minority students pursuing an MBA at a member school. The fellowship includes full tuition, required fees, stipends, and access to summer internships with top companies.
▶️ MBA Scholarships for Women
Jane M. Klausman Women in Business Scholarship
Every year, Zonta International awards the Jane M. Klausman Scholarship to outstanding women studying business management or related fields like IT, HR, and marketing. These scholarships are open to students in many countries.
American Association of University Women (AAUW) Fellowships & Grants
AAUW Funds is one of the biggest funding sources for women in graduate studies worldwide. It helps aspiring scholars, teachers, community activists, women at key points in their careers, and those entering fields where women are rare.
Forté Future Leaders Scholarship Program
The Forté Foundation offers scholarships for women in MBA programs at leading business schools worldwide. Scholarship recipients gain access to networking events, mentors, and resources to support their academic and professional growth.
▶️ MBA Scholarships for Minorities
Lagrant Foundation Graduate Scholarships
LAGRANT Foundation scholarships are for full-time university students from diverse ethnic backgrounds. To apply, you must be a graduate student specializing in advertising, marketing, or public relations (or related fields) and have at least a 3.2 GPA.
Goldman Sachs MBA Fellowship
The Goldman Sachs MGA Fellowship targets first-year MBA students who excel in academics and community service. It focuses on diversity, welcoming applications from minority groups (such as LGBTQIA+, Black, Hispanic, Native American) and women.
National Black MBA Association Scholarships
The National Black MBA Association is the leading business organization for Black professionals in the US. It uses its strong networks to encourage members to apply for scholarships at various universities.
Management Leadership for Tomorrow (MLT) MBA Prep Program
The Management Leadership for Tomorrow (MLT) MBA Prep Program prepares high-achieving, underrepresented minorities with the skills and mindset needed to transition from college into graduate school or business successfully. The program includes personalized coaching, access to top-tier business schools, and opportunities for internships and career advancement.
▶️ MBA Scholarships for Veterans
VFW Sport Clips Help A Hero Scholarship
This VFW scholarship is for ex- and current military members (including US citizens) who need financial help. It's open to retired veterans, those honorably discharged, and active-duty members (after basic and follow-on training). National Guard and Reserve members are eligible too.
Tillman Scholarship
The Pat Tillman Scholarship is available to veterans, active military members (including National Guard), and their current or surviving spouses. To apply, you must be enrolled full-time and keep a 3.0 GPA for the scholarship to be renewable.
Yellow Ribbon Scholarship
The Yellow Ribbon Scholarship offers more tuition and fee support for US veterans, their spouses, and families. Make sure you're eligible before applying. Both part-time and full-time students can apply on a first-come, first-serve basis.
Maximize your financial wellness as an MBA student
At Doing Well, we understand the unique financial challenges and opportunities MBA students face. Our goal is to empower you with the tools and knowledge necessary to:
- Develop a sustainable budget that accommodates your academic expenses and lifestyle.
- Navigate student loans and scholarship opportunities with ease and efficiency.
- Plan ahead for your financial future, including investments and savings strategies tailored to your career ambitions.
- Enhance your financial literacy, enabling you to make informed decisions that align with your personal and professional goals.
Remember that wealth isn't only about the income you earn, but also about how you manage and grow what you have. With Doing Well by your side, you can feel confident and equipped to tackle your personal finances during and beyond your MBA journey. You can book a free call here.
