Repaying Your MBA

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MBA programs prepare students to enter career tracks with high pay. They are also notoriously expensive. Explore ways to manage the cost of a master's degree in business. is an advertising-supported site. Featured or trusted partner programs and all school search, finder, or match results are for schools that compensate us. This compensation does not influence our school rankings, resource guides, or other editorially-independent information published on this site.

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MBAs rank among the most prestigious and coveted university degrees. They are also one of the most expensive. Top-ranked MBA programs at leading schools can cost more than $80,000 per year in tuition alone. Given these costs, many students start thinking about their MBA debt before their coursework even begins.

Alternative learning formats can lead to financial relief. Fully online and hybrid MBA programs that blend virtual and campus-based learning may help reduce costs.

At the same time, even the most affordable MBA programs represent a significant investment. Students should enter business school with a plan in place for how to pay for their MBA.

This guide features an in-depth exploration of the financial side of earning an MBA. It examines program costs, average debt levels, financing options, debt repayment strategies, and more.

Average MBA Debt

The National Center for Education Statistics (NCES) tracks student debt levels. As of 2023, its most recent available student debt data covers the 2015-2016 academic year.

The NCES reports that 51% of MBA students graduated with debt that year, with the average debt topping $65,000. Adjusted for inflation (2021 dollars), that figure climbed to nearly $72,000.

The amount of debt an MBA student will have at graduation depends on many factors. Affordable online MBA programs feature lower tuition rates and generally result in less debt. Some students avoid debt by using savings or finding creative financing solutions.

Additional factors impacting MBA program costs include:

  • School Prestige: Highly regarded business schools tend to charge premium rates.
  • Program Format: Some business schools attach lower tuition rates to their online programs and courses.
  • Program Length: Shorter programs and those with fewer credit requirements may charge lower tuition.
  • Peripheral Costs: Books, computer equipment, software, and mandatory fees can all elevate the actual cost of attending an MBA program.

To help control MBA debt, students can consider several general strategies. These broadly include:

  • Saving on commuting, parking, and living costs by studying online
  • Studying part time while continuing to work
  • Choosing an accelerated program with a shorter graduation timeline

The following sections explore specific financing and cost management options in greater detail.

How You Can Pay for Your MBA

Students seeking to self-finance their MBAs have numerous available options. These broadly include:

  • Taking advantage of 529 college savings plans
  • Using cash from a savings account
  • Working while studying, and using earnings to cover educational costs

Given MBA costs, options like 529 plans and cash-based savings require years of advanced planning. If you know an MBA is in your future, these strategies can deliver huge advantages by helping you avoid debt.

Recognizing the high costs of earning an MBA, many business schools offer payment plans. These plans allow students to break down their costs into installments with smaller amounts. However, some payment plans apply interest and penalty fees to missed or overdue payments. If you incur such fees, your total costs will rise.

Schools may offer discounts or other cost advantages to students who pay their fees upfront and in full. If your school supports such options and you are able to meet the costs, this strategy is well worth considering.

Students who require aid should begin by researching non-repayable financing options that will not lead to debt. These include scholarships, fellowships, and grants. Bridge remaining gaps using savings, income, and gifts or loans from family members. Use federal and private loans as a last-resort measure.

How to Get Your MBA Paid For

Having a third party finance some or all of your MBA studies can deliver major advantages. Reduce and control your MBA debt by researching these four options:

  1. 1

    Institutional Aid Programs

    Business schools frequently feature valuable internal aid programs available only to students. Institutional programs are generally need-based or merit-based. They typically include scholarships, grants, work-study opportunities, and credit-based fee waivers.
  2. 2

    Private Grants

    Philanthropic foundations, multinational corporations, and other organizations offer private grants for education funding. As with institutional scholarships, these programs are typically need-based or merit-based. Some are also designed to support diversity by offering financing specifically to members of demographic groups historically underrepresented in MBA programs and related career tracks.
  3. 3


    Key sources of non-repayable scholarships include charities, professional organizations, businesses, institutions, wealthy individuals, and governments.
  4. 4

    Employer-Based Financing

    Companies often offer employer-based MBA financing programs. These generally take the form of tuition assistance or reimbursement. You may find some strings attached: For example, you may need to commit to remaining with your employer for a fixed period after completing your MBA. Many professionals nevertheless find employer-based assistance programs well worthwhile.

For those wondering how to pay for an MBA without incurring debt, these strategies represent powerful options. They can also improve your overall ROI by cutting your personal costs.

Making a Repayment Decision

MBAs can lead to major financial rewards, including higher salaries and significantly improved upward career mobility. However, average MBA debt loads total tens of thousands of dollars. You should carefully consider the balance between financial rewards and risks.

If you choose or need to take out loans, consider federal loans first. They offer cost-cutting perks including grace periods and enhanced repayment flexibility.

If you do take out loans, personal finance experts stress the importance of becoming debt-free as fast as possible. Lower monthly payments may seem attractive. They can also make more sense in some cases, especially for those juggling multiple financial commitments. However, they increase your total costs, as interest adds up for longer periods.

When looking into how to get your MBA paid for, consider every available avenue. Perform thorough scholarship and grant research, and apply to every opportunity for which you qualify. Seek aid through your business school, and try your best to minimize exposure to repayable interest-bearing debt.

Common Questions About Repaying Your MBA

How do most people pay for an MBA?

According to NCES, more than half of MBA students use loans to finance their education costs. Additional options include scholarships, grants, employer-based tuition assistance, and using personal savings or income earned from working.

How much debt is an average MBA?

NCES data from the 2015-2016 school year indicated an average debt level of about $65,000 for MBA graduates. Adjusted for inflation, the figure equated to about $72,000 in 2021 dollars.

Is it worth going back for an MBA?

A 2022 analysis found that MBA graduates experienced immediate earnings increases of about $20,000 per year. That equates to half a million dollars in additional compensation over a 25-year career. For most people, this represents significant value.

Should I pay out of pocket for an MBA?

If you have the money and can pay for your MBA out-of-pocket without endangering your financial stability, consider doing so. This safeguards you from interest accruals and helps you avoid the potential sting of future tuition increases.

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