The following article was provided by a guest author, cited at the bottom of the page:
As with many graduate degrees these days, getting your MBA can come at a steep cost: The typical MBA student debt load is in the ballpark of $60,000-$100,000. As well all know, starting off out of grad school with a $800 or more per month loan bill is a huge burden that is best to be avoided if at all possible. Fortunately, for the MBA candidate who thinks ahead, there are ways that you can reduce your debt load substantially. Some ideas you would think of right away, but others not so much. Here are our top four:
- Generate More Income After Graduate School: Sounds rather obvious, right? Well, how the heck do you do that? One big secret that some wise MBA students learned is to enroll in business school earlier. For example, rather than waiting five or six years after you complete your bachelor’s degree, start graduate school a year or two after your undergraduate work. If you do this, you are going to be earning that $75,000 per year or whatever as an MBA graduate three or four years sooner. That’s more income that you can use to pay off your debt faster!
- Strongly Consider a Low-Cost MBA Program, Including Online Programs. Sure, everyone and his brother wants to graduate from Harvard Business School, but that fancy degree comes at a massive price: Upwards of $100,000 in student loan debt. Ouch! You can avoid this by going to a second or even third tier MBA program. US News and World Report recently ranked the top ten MBA schools in the US with the lowest average student loan debt. Some of the best deals included University of North Carolina-Wilmington, Louisiana State University, San Diego State University, and Mississippi State University.Also, you should think about getting an online MBA that is fully accredited for quality in its region. There are many strong MBA programs now available online that are cheaper than traditional MBAs: University of North Carolina and Texas A&M Commerce are two affordable, quality online MBAs worth considering.
- Live Cheap in Grad School: An obvious point, but one that many students skip. There are many ways that you can minimize your expenses in graduate school. Bike to campus. Pack your lunch. Take your coffee or tea in a Thermos. No fancy clothes or bags for as long as you are in your MBA program. Avoid bars. Eat beans and rice. No expensive entertainment or concerts. Live far off campus for cheaper rent and carpool. Do NOT do expensive overseas travel on those pricey MBA junkets so many schools like to throw into the mix.
- Live Cheap After Grad School: After graduation from business school, many grads take that $75,000 salary and lease a BMW, go out to expensive dinners three nights a week, and generally spend $1000 or more a month on entertainment. While you are doing all that, you probably are paying $700 or more a month on a student loan with a serious interest rate. If you pay the minimum each month, you will probably add $30,000 or more to the total cost of your loan! So, live cheap. Buy or rent your car with services like ZipCar or get a Hipster fixed-gear bike. Get a second job. Rent out your spare bedroom. Buy used furniture. Put every extra dime, other than an emergency savings fund, into paying off your loans.
As you can see, there ARE ways you can cut thousands of dollars off your debt load, both before graduation and after. It’s all possible with a bit of planning.
About the Author
Joseph Pickett is a staff writer for Onlinembanogmat.Info, a MBA portal where he writes about Online MBA programs without the GMAT or GRE requirement that most traditional off-line programs require. It’s his goal to educate those considering a career upgrade to consider a NO GMAT MBA option for a number of reasons including cost-savings.