What can I do with an international business career?

Career Advice :How International Students can fund their MBA at a Top Business School?

• I want to pursue an MBA from abroad. Currently, I live in India, and have just started my life as a professional. I  graduated out of college this year, and working as a software engineer, and earning 5 Lakhs INR per annum. I know I won't be able to afford the fees which is around $100,000 for most good colleges. What are my options, can I take a loan for such a big amount. How can I manage considering I will be doing it in 2015. Are there any hidden additional costs that I don't know of, and I don't have any strong financial background. I am all by myself, and yes is it a good Return of Investment to spend around 50 Lakhs of INR, considering I would do it from a top 20 - 30 school.

• Answer:

  Major sources of student funding for US MBA programs Here is a list of the major sources of funding that you can tap for your MBA in the USA: - Scholarships: These usually come in two flavors – school-driven and external. School-driven scholarships are usually announced around the time that the admissions decision is communicated to you (there may sometimes be a lag of a few days). In some other cases, schools may require you to apply for scholarships after you get in, and you may be required to submit additional documentation (including further essays) for this. Beyond school-driven scholarships, there are also external ones from social and educational organizations that want to promote top talent. The amount and eligibility criteria can vary, and you should take out the time to go through each in detail. Remember to start early – most scholarships go out quickly. - School loans: This should really be the first avenue that you should explore after looking at scholarships. Most top US schools will offer you loans that have much lower interest rates than those available from foreign banks. Typical interest rates for these loans hover around ~7-8%, and can be further reduced if you can get a US co-signer for the loan. Some students do not have friends or family in the US, and must rely only on non-cosigner loans. Some top schools that offer these are MIT, Booth, Wharton, Yale, Haas, Fuqua, Darden, Anderson, Cornell, Kenan Flagler, and Emory [this list is NOT exhaustive - please check the particular school you are looking at to be sure]. The repayment periods for these loans vary from 10-20+ years. Typically, students are able to pay back loans in a period of 5-7 years after they graduate (assuming that they continue to work in the US in this period). - Independent credit unions and societies: Non-bank institutions like http://www.gyanone.com/blog/how-to-finance-your-mba-in-usa/www.credila.com(India) and http://www.gyanone.com/blog/how-to-finance-your-mba-in-usa/www.globalslc.com offer the option to borrow money in the US without a US co-signer (rates are usually more competitive than those at private banks). There is also the http://www.gyanone.com/blog/how-to-finance-your-mba-in-usa/www.internationalstudentloan.com but this requires a US co-signer. Please note that organizations like CommonBond and SoFi, which provide crowd-funded student loans, are NOT options for international students (they require the borrower to be a US citizen or Permanent Resident). - Bank loans: A bank loan is the next option you would need to look at, either separately or in combination with the others. Depending on the interest rates in your own country, you might like to consider whether a US bank loan will be cheaper or one taken from a local bank. Most US private banks will require a co-signer if you are an international student, and interest rates will be in the 7-9% region (there may be exceptions). That is still competitive when compared to, for example, Indian banks, that currently disburse only limited amounts as student loans and have interest rates in the 12-14% region. Some local banks will be willing to lend much higher amounts against collateral pledged. - Personal savings: Top MBA programs admit experienced professionals, and if you have been saving regularly, you would have some saving to fall back on. This includes not just the money in your (and your spouse’s) bank account, but also that in public saving schemes and short-term investment schemes. It is wiser to use this money rather than take a larger loan from the bank – there is little chance that your money will earn the kind of interest in your home country that you will need to pay for the education. The bottomline – start early, and plan deep Most people end up choosing the school loan option where it is available, though a significant percentage use multiple sources to pay for their MBA. A small minority also tap into work on campus or assistantships to earn some more money. In our opinion, that may not be the best thing to do – the money won’t be much, and there is little time available at top MBA programs to also work alongside. Judicious financial planning done early can ensure that arranging funds does not get in the way of your MBA dream. This will help you not just to have a better MBA experience, but also give you a more realistic picture of the time you would need to spend working abroad to be able to pay the loan off. Understand the landscape for student borrowing and funding better. See which schools suit you. And how we can help you make it to your dream choices. For more, visit http://www.gyanone.com/b