Congratulations! You have made a great decision in your life; you want to do an MBA. But there is only one problem standing in the way of your career path; How do you get financing for your MBA? This is often the main obstacle to getting an MBA; COST! It is pretty rare that you have 25K lying under your bed to pay for tuition fees. This is why it is imperative to find a way to finance your MBA.

I want to share something with you; I did my MBA for free! In fact, there is a very easy way to get free financing for your MBA, here’s my step by step method:

Financing Your MBA Step #1: Be a Good Boy

You are the guy who keeps on whining about your boss in the cafeteria? Stop biting the hand feeds you and start acting like an MBA candidate. Employers can be motivated to finance an MBA for promising employees. If you really don’t like where you work, forget about having your MBA paid by your employer.  You are better off choosing a company where you see yourself working for several years. Then, you just have to behave like you belong at this corporation and want to improve it. Being a good employee, going the extra mile, will eventually lead you to a financed MBA ;-).

Financing Your MBA Step #2: Let Your Boss Know

You may be the best employee ever, if you don’t let your boss and the people above you that you want to get an MBA, nobody will pay for it. You want your employer to finance your MBA? Simply ask for it. However, there is a time and a place for every thing. Personally, I had waited a year where I got an “outstanding” employee evaluation at year end. I discussed how I wanted to go higher and that I was willing to put the effort into it. Then, I asked if they were open to pay for my MBA.

Financing Your MBA Step #3: Be Specific

When I ask my boss to finance my MBA, I didn’t ask it bluntly. I built my case with reasons why I wanted to get an MBA and how it could help my company. The point was showing them that paying for my courses was an investment in their own corporation and not just some money thrown on a eager GEN Y so he can fly off once he’s done. I told them which MBA program I wanted to do and how this kind of knowledge will help me become a better employee. If you come with a school name and program specification, it shows that you are serious about doing your studies.

Financing Your MBA Step #4: Accept Compromises

It’s not always easy to get someone else to pay for your studies. As your parents might have put some conditions on the table while you were in college, your employer is more likely to bind you with a contract in exchange of financing. Personally, I signed a 3 year contract with my employer that links me to them for 3 years after I have completed my MBA program. 3 years may seem long at first, but I can tell you that time flies! I have done 1 year already and I don’t feel that staying another 2 years would be such a pain.

The other thing I had to do as a compromise was to keep my full time job while completing my studies. I wasn’t given much time off to work on my MBA assignments. They gave me one day off per course upon my final exam. The rest of the time had to be taken on my evenings and weekends.

Other ways to finance your MBA

If you don’t have an employer ready to invest in your career, there are also MBA grants and government help. Depending on where you live, you can also have access to programs allowing you to withdraw from your retirement funds in order to finance your courses. However, I still think that getting your employer to finance your MBA is the best solution :-D.

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mba programs in canada

When I first thought of completing an MBA, I wanted to get the right one for my needs. There are plenty of MBA programs in Canada and with technology, there are some MBA programs you can get from home. For example, when I was looking at Financial Services MBA programs, I found out that Dalhousie was offering an online MBA program!

Get The Right MBA Program Before Looking at the School

The very first step when you are thinking of starting an MBA program is to look what different specialities are available. Most people ignore what an MBA is and this is why you may be disappointed if you don’t pick the right one upfront. A general MBA program is good for someone who doesn’t have a bachelor degree in commerce. Engineers, lawyers or entrepreneurs will look into such programs because they don’t have much marketing, finance, or human resources knowledge. However, if you have your bachelor degree and you enter into a general MBA program, you probably won’t learn much.  So before you look at which school you want to go to, look at all the specialities.

Why I wanted to do an MBA

I can’t speak of what I don’t know, so I won’t talk much about the MBA programs in the states. However, I had been looking carefully into several MBA programs in Canada before making my final decision. When I had decided to start the MBA, there were 3 reasons why I did it:

I wanted to start a Network

I think that the biggest strength of any MBA program resides in its ability to grow a huge network of contacts. This is where you make connections with influential people in several other companies. In my case, I had decided to take the financial services MBA program since I wanted to know people in the banking industry. I work as a financial planner so knowing several managers in other banks couldn’t hurt ;-).

I think you should spend a lot of time with everybody in your class. Try to organize cocktails or outside MBA activities. While it will require more time, this is where you will get the highest ROI from your MBA.

I wanted to upgrade my knowledge

I didn’t want to go to school to listen to teachers telling me what the new trend in management is. What I wanted was to learn from my team members’ work experience. MBA programs in Canada are designed in a way where you will touch on several topics but not won’t become an expert in any of them. As I had been working in marketing and finance already, there wasn’t much academic stuff that I had to learn. On the other hand, each MBA session included times when people exchanged their best practices and past experiences. These were the moments when I was taking the most notes of the day!

I wanted to get the darn paper ;-)

Believe it or not, an MBA diploma is not a minimum requirement for any job. This doesn’t make you shine; it only puts you equal to or ahead of other candidates while applying for a better career opportunity. Getting into an MBA program was the easiest and simplest way to access to better paying position. If you are a good employee and you have the right diplomas, employers are calling you to give you a job. This is what I wanted; the chance to interview employers instead of being interviewed by them.

MBA Programs in Canada List

I have gathered information from several MBA schools across Canada to make a list with all the links to their programs. I hope this will be helpful if you are looking for a specific MBA program:

I often get questions from readers like the following one, which ask me about whether to choose an MBA vs. another degree like a Master of Finance, or even between an certification like a CPA or a CFA:

Example 1: I recently came across your blog when I was trying to learn how to use Vlookup and Pivot table, and wanted to thank you for making it so simple to understand. I also began reading some of your other posts and see that you have a lot of knowledge about business education and the corporate world. I’m currently a senior in economics at University of California, San Diego (UCSD) and I will be graduating this June. I want to become a financial analyst, but I haven’t been able to find a job. So I’m considering applying for a Masters in Finance at University of San Francisco. What is your opinion about such a program? To me the upside of the program is that it’s only a year long and it takes recent graduates with no significant work experience. However, University of San Francisco is not a very prestigious school and I’m not sure how much a Masters in Finance will improve my chances of finding a job. The program is very expensive ($40,000) and I don’t want to spend that kind of money if employers wont consider it to be important. Thank you once again for your blog and I look forward to hearing back from you.

Example 2: I’m a MBA finance option student in Alabama, US. First I would like to thank you for all materials that you post on your web-site. They are very helpful. Sometimes if I don’t understand anything from my textbooks i go to experiglot.com. They are easy to understand.

I have noticed that in US if you want to be employed every employer requires you a certification like CPA, CFO even if you want to train somebody in the gym you really need to be certified. I would like to know what kind of certification exist for financiers?! I don’t have any working experience in finance field. But I have a 5 years IT manager experience. And I don’t think that it will be useful to be financially certified. I would really appreciate your help !!

Although the reason readers are asking about the value of an MBA or similar degree or certification differ, the examples above are pretty representative of the reasons that people decide to enroll in these programs.

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I received the following email from a reader:

I’ve been trying to solve this problem for sometime with no success. I have also attempted using your information (How to calculate NPV) on the website, got close but still didnt get the solution.

Can you please help? Here is the question.

A fashion clothing company is considering investing in new machinery to improve its productivity over the next 5 years. You have been given the following information:

Sales are predicted to increase by $1,500,000 in year 1 and continue at this level.

The new machinery costs $10 million payable immediately.

It will be depreciated over 5 years on a straight line basis.

All the old machinery can be sold for $2 million.

The new equipment is more complicated and will cost $160,000 per year every year to maintain, as against the $100,000 for the old machines, but other running costs will be reduced by $120,000.

Finance for the purchase needs to be raised via a loan which requires annual interest payments of $300,000.

Wages will be reduced by $100,000 due to increased automation.

At the end of the five years the machinery will have a scrap value of $2million.

The feasibility study for this project (already completed and paid for) cost $200,000.

The cost of capital on investment appraisal for this level of risk is 7.5%.

Identify which of these items would be included in an NPV calculation and calculate the NPV. You may ignore tax and inflation.

This sounds like a typical NPV problem that you’d find in a business school finance class, and simplifies things by ignoring tax and inflation.

I’m laying out my reasoning and solution here, but I welcome any comments from others, as there may be other interpretations and I might just be plain wrong. (The beauty of a blog, right?)

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My philosophy on maintaining this blog site is very different from that of most bloggers. Rather than update it constantly with the latest happenings, I aim to write longer how-to explanations and tutorials that are less time-sensitive and provide useful reference material long after they’re written.

Though my posting rate has declined dramatically recently (this will improve soon), I still receive questions from readers, mainly about using Excel functions. Last week, I received one from a reader named Jae, who asked a Finance 101 question:

I have a problem in my finance class where the annual revenues from a project is $500,000 and annual costs are $300,000. The corporate tax rate is 40% and the cost of capital is 12%. How do I calculate NPV of the project?

The original problem has probably been paraphrased, and lacking other information, here’s how I’d interpret the problem. The project generates pre-tax revenues of $500K a year, and incurs operating costs of $300K a year. The corporate tax rate is 40%, the cost of capital is 12%, but nothing is provided about how long the project will last. For simplicity’s sake, let’s suppose it lasts 5 years and then ends at the end of year 5.

The setup for solving this problem is very similar to another post I wrote on how to calculate net present value (NPV) a while back.

Here’s how I’d set up the calculation in Excel to solve this problem, assuming the project lasted 5 years:

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