So you're investing in your future, but who'll provide the capital? By Emma Haughton

We may still be living in uncertain economic times, but getting an MBA isn't becoming any cheaper. On the contrary; each year sees costs at many institutions rising steadily. A full-time course at a top school like London Business School will set you back around £40,000 in fees alone, before taking into account living costs and loss of earnings. Even at the cheaper end of the market you can still expect to pay around £9-10,000 for a full-time course, and slightly less for the part-time option.

If you've got your heart set on taking a year out to concentrate on studying, your funding options will be limited, says Peter Calladine of the Association of MBAs. "Unless you're working for the likes of one of the large international consultancy firms, it's very unlikely you'll get sponsorship for a full-time course."

So what are your options if you are faced with footing the bill yourself? The Grants Register is considered the bible for scholarships and bursaries, but the chances of funding an MBA that way are pretty remote. Your most likely sources of cash will be a cocktail of savings, loans or family support.

Fortunately, schools are keen to help out, with a number now offering cut-rate loan schemes. LBS, for instance, has an exclusive loan agreement with HSBC bank, which gives students preferential rates on their MBA loans. The Open University Business School, on the other hand, has a student budget account at a low interest rate, so students can pay their course fees monthly, rather than having to find thousands of pounds in one go. The Association of MBAs itself has a loan scheme, set up way back in 1969. Operated through Nat West bank, it offers funding towards accredited MBA courses.

You might also want to consider a Career Development Loan, offered by several banks in partnership with the Department for Education and Skills. But bear in mind that these loans are usually limited in terms of how much you can borrow.

And don't overlook funding from schools themselves. Many offer bursaries for full-time study, doled out according to merit or on a do-good basis for people who can't study without it. Sometimes they're geared to encourage specific groups to consider an MBA, such as women or ethnic minorities. Manchester Business School, for example, offers up to 10 awards each year, worth £5,000 in deducted course fees. "We look for either academic excellence or someone who has got a particular interesting background, such as a variety of international experience," says Rachel Tuft, associate director of marketing for the MBA programme. "For example, we gave one to someone who had been laying pipelines in Cambodia. We also look for people who contribute well to their local community. Usually our winners tend to meet all three criteria - they're good all-rounders."

The University of Bath School of Management has taken a different tack with its recently introduced MBA scholarship scheme, rewarding on-programme academic performance. Up to five half-fee retrospective scholarships, worth around £9,000 each, are on offer to top-performing students enrolling on the full-time MBA programme from October 2003.

"This scheme fits our ethos, which is to bring out the best in the individual and encourage excellence from all our students," says Ruth Cooper, MBA admissions and marketing manager.

It's also worth factoring in what you might get paid for the placements and projects you undertake during the course - those on two-year full-time MBAs, for instance, can make a substantial amount on their summer placement.

However much your MBA does cost you, it's important to look on it as an investment in the longer term. "Most people don't do it for the salary increase, but because they want to do something more exciting," says Calladine. "But basically you can expect a reasonable premium on your investment."

That said, just because you've done an MBA it doesn't entitle you to a salary of 60k a year. "You're never divorced from your CV," he warns. "Be realistic. It's an investment over your whole career, not just for the next couple of years."

Of course, if you go down the part-time route - as do over 80 per cent of all British students doing an MBA - the funding issue becomes a whole different ball game. For a start, you won't be losing your salary. And there is a good chance you can persuade your company to sponsor you - around 50 per cent of part-time and distance learning students receive some sort of company sponsorship or contribution, the association's statistics show.

Calladine recommends you put a detailed business plan together, particularly if your company doesn't have a comprehensive system of developing key managers. "Go and present it to your boss or HR director or whoever," he suggests, "and make sure you're presenting the best case you can."

So what exactly can you put in there to convince your employer that sponsoring your MBA will benefit your organisation as well as you?

"An important thing to point out to your employer is that although the course may last between two and four years, what you learn on Tuesday you can actually put to use on Wednesday morning," says Calladine. "Employers get an immediate return on their investment from day one."

Any extended projects or dissertations also give the company a chance to try you out at a higher level of expertise. Not to mention if there's an important issue that needs addressing, rather than haul in KPMG, they've got an in-house consultant who can look into it for them.

It's also worth reminding those holding the purse strings that they also get an employee who is both enthused and excited, not to mention the added benefit that you'll be so busy you won't even be able to contemplate moving to a new job.

"Some companies feel it's worth sponsoring someone just to keep them tied in for that length of time," says Calladine.

JONATHAN MALCOLM

Jonathan Malcolm, 32, has just finished a full-time MBA at Exeter, and is in the process of setting up his own business.

I was actually working for a telecoms company in Bristol, and someone there was doing an MBA when I joined. That spurred my initial interest, and I thought about it more and more and just decided it was the next right move. I was also in the process of getting married, so it also seemed like a good time for a change.

Exeter was a convenient location to take the course because my partner lived in the West Country. But I went for them because the school is also accredited, and I really liked lecturers I met when I went for a visit.

The course fees were around £14,000. My wife and I were in the fortunate position of each having a property, although not much spare capital. So I sold my flat and bought another, which freed up a whole load of equity. Then I funded my living costs during the MBA from renting out the new flat as well as being supported by my wife.

It's been quite a tough year, especially with a lot of money going on us getting married the year before. But I do think it's been worth it. The course gave me a chance to step out of working life and take a broader view of business and how they operate. And getting to know people and working with them has been a great experience.

I'm now in the process of setting up my own business in seafood processing with someone I met on the course, along with another friend.

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