5 Ways to Get Help Paying for Business School
One of the more daunting tasks of pursuing your MBA is determining how to pay for tuition. Fortunately, there are a variety of options available when it comes to covering tuition and related costs. Here are five methods of securing funds for your education.
1. Employer Sponsorship
Many employers encourage their employees to earn an MBA, as it’s often in a company’s best interest to further your education and increase your value to your company. Many employers pay for all or at least a percentage of tuition costs. Ask management or the human resources department about your company’s policy on paying for employee education. The IRS allows many employers to deduct up to $5,250 per employee in tuition expenses. Many large companies have a formal tuition funding program, while smaller companies may help fund schooling on an individual basis.
2. Retirement Savings
In most instances, if you take money out of an IRA before you reach 59-1/2 years old, you must pay a 10 percent additional tax on the early distribution. However, the additional tax doesn’t apply if you withdraw the money to pay for college. According to the IRS, eligible expenses for withdrawal without penalty include tuition, fees, books, supplies, and equipment required for schooling.
3. Federal Loans
The U.S. Department of Education Federal Student Aid office offers a variety of loans. MBA students may be eligible for Direct Unsubsidized Loans. Direct PLUS loans may also be an option for graduate students and are designed to pay for educational expenses that aren’t covered by other forms of financial aid.
4. Private Loans
If federal student aid isn’t sufficient to cover your costs, consider private education loans, which are offered by a wide variety of lenders, including many banks. Do your homework when looking into obtaining a private loan. Fees charged by lenders can increase costs substantially. Be diligent and ask questions that determine the true cost of the loan prior to borrowing the money.
5. GI Bill
Known as the "Post 9/11 GI Bill," the new GI Bill (Chapter 33) that went into effect August 1, 2009 offers a comprehensive package of benefits to eligible students. Eligible students may also receive a monthly housing allowance. You may wish to take advantage of this benefit or another program such as the Montgomery GI Bill (MGIB).
The expense of obtaining your MBA is a big hurdle to overcome. Taking the time to research these tried-and-true funding possibilities will bring you that much closer to reaping the benefits inherent to investing in your continued education.
Written by Ashford University staff