Does Financial Aid Cover the Cost of an MBA?

A Master of Business Administration (MBA) program is often the key to unlocking career advancement and higher average earnings. The increased chances of getting hired for executive positions in the business world are enticing, but the cost of attending graduate school can also deter many students.

Fortunately, an MBA degree program can be covered by various types of financial aid programs. Graduate students may qualify for need-based or merit-based scholarships, as well as federal financial aid like grants. MBA students can use these programs to reduce and cover their school costs and lower the burden of student loan debt after graduation.

What Is the FAFSA Form?

The Free Application for Federal Student Aid (FAFSA) is used by the federal government and other need-based financial assistance programs to determine eligibility. The application process includes submitting tax information and answering questions about income and expected family contributions (EFC). Submitting your FAFSA establishes your financial need and federal programs automatically apply toward qualified tuition expenses.

Eligibility

All U.S. citizens or qualified non-citizen permanent residents are eligible to complete the FAFSA application process. Once you submit your form and evaluated financial need is evaluated and determined. Students must meet certain requirements and have a gap between their total cost of attendance and their EFC.

Can I Receive Financial Aid for an MBA Program?

Financial aid awarded by the federal government or private institutions can be used to cover the costs of an MBA program. However, you'll have access to different programs as a graduate student than you did as an undergraduate student. Students receive financial aid packages based on need; however, some graduate students won't meet these same requirements if they've earned a higher salary after completing their bachelor's degree.

Learn more: Guide to Using FAFSA for Your MBA

Does Financial Aid Cover Online MBA Programs?

Yes, financial aid can cover online MBA programs, provided they meet certain criteria. MBAs are commonly pursued by working professionals looking to advance their careers, which makes online programs an appealing option.

Ensure your online MBA program is offered by an accredited university. Some financial aid programs also require maintaining a minimum GPA; others may set requirements for part-time or full-time enrollment status.

Types of Financial Aid for MBA

MBA students can access different types of financial aid from the government and private organizations. Some of the most common financial aid awards for MBA students include grants and scholarships, but other options include fellowships and student loan programs. Free money programs, like grants and scholarships, are often the best for graduate students because they don't require repayment.

1. Explore MBA Scholarships

Graduates of business schools often go on to be successful members of society that try to give back. This often involves offering scholarships specifically for business students looking to earn MBAs. Several free MBA scholarships can help you pay for your schooling.

AICP Scholarship Program

The Association of Insurance Compliance Professionals (AICP) offers a scholarship to undergraduate and graduate students in insurance, actuarial science, economics, finance, management, mathematics, risk management, statistics, or a business-related degree program. MBA students with one of these concentrations and a 3.0 GPA can apply for one of four $2,000 scholarships.

John Hopkin's Dean's Scholarship

John Hopkins University offers multiple scholarships based on need and merit. Students can apply for these programs regardless of field of study. Need-based scholarships include FAFSA results when determining eligibility.

2. Look for MBA Sponsorships

An MBA sponsorship is like a scholarship, except money is awarded for tuition reimbursement and the student works with a business or government agency for varying lengths. Students who complete sponsorships will also develop real-world experience and networking opportunities, akin to an internship or fellowship. Sponsorships are generally for employees of a single company as part of a benefits program.

Capitol One Graduate Degree Sponsorship Program

The Capital One Graduate Degree Sponsorship Program lets students work on projects from 10 months to two years. These programs involve various hands-on roles that allow students to utilize the skills they are studying in their MBA program.

IBM's MBA Sponsorship Program

IBM's MBA Sponsorship Program can cover the full cost of your MBA program, but your degree program must be related to your position within the company or a stated career plan. After completing your MBA program, you must work at IBM for at least two years.

Verizon's Global Tuition Assistance Program

Verizon awards employees tuition assistance up to $8,000 per year. This money can be used for accredited online or in-person higher education opportunities, including your MBA. V teamers (members of Verizon's employee network) can begin to apply for these benefits shortly after hiring. This program reflects Verizon's commitment to developing leaders from within.

3. Discover MBA Fellowships

MBA fellowships allow students to work with a company or companies to earn real-world experience. In exchange, fellows receive payment that can be used to cover school costs. Fellowships are often completed as part of a graduate program, much like an internship is completed during undergraduate studies.

Knight-Hennessy Scholars

Knight-Hennessy Scholars are a select group of graduate students at Stanford University. This fellowship covers up to three academic years of tuition, but the full length adjusts based on the timeframe of your graduate program. KH scholars also receive housing and supply stipends. Students from any graduate program can apply to be part of the KH cohort, but selection is competitive.

4. Evaluate Student Loan Options

Student loans may be used as a last-dollar financial support plan. MBA loans should be used sparingly because they require repayment, often resulting in long-term student loan debt. Graduate students can choose between federal student loans and private loans. U.S. Department of Education loans come in four main types:

• subsidized direct loans
• direct unsubsidized loans
• direct grad plus loan
• direct consolidation loans

Federal student loans often have lower interest rates compared to private loans. Some federal student loans qualify for loan forgiveness programs, but private loans won't.

Private Student Loans

Private student loans are offered by private lenders, such as banks and credit unions. Private loans include a credit score check and some applicants will need a co-signer to qualify.

5. Complete a Work-Study Program

The Department of Education and your school's financial aid office can help you coordinate work-study programs. Students work for a local business or government agency to earn real-world experience and payment, which can be used for school expenses. Work-study programs, unlike sponsorships and fellowships, aren't coordinated by a business and don't have requirements to continue working in that position after completing your MBA.