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When Will My Student Loans Be Paid Off?

About 65% of college graduates in 2017 owed an average of $28,650, according to The Institute for College Access and Success . Owing nearly $30,000 can seem overwhelming, and you might wonder how long it will take to pay off that loan, and whether paying it off will prevent you from reaching other financial milestones, such as buying a house or a car, or starting a family.

Our Student Loan Payoff Calculator can help you figure out how long it might take to pay off your loan under your current payment plan. If you are unsure of your loans and payment dates, you can also look them up. Use the National Student Loan Data System to view all your federal loans and the to find a list of any of your private loans.

If you’d like to pay off your student loans faster, here are eight ways to potentially hit that debt-free milestone sooner than you planned to.

Making Extra Payments

There are no prepayment penalties with student loans, so if you want to pay off your loan faster, you can simply make an extra payment each month. However, borrowers may need to specify that any extra payments should be applied to their principal loan balance, not the next monthly payment.

Making a Yearly Lump-Sum Payment

Tax refunds or yearly bonuses can be used to make an extra one-time payment each year. Paying even an extra $1,000 from a tax return once a year could help someone get out of debt sooner.

Devoting Side-gig Earnings to Your Loans

Taking on a side gig that allows you to earn extra money can start with an Etsy shop, walking dogs, or offering guitar lessons. Considering the average dog walker rate is $13.94 an hour , just five hours a week walking dogs could mean an extra $3,600 a year.

Need help paying down your student loans?
Student loan refinancing with SoFi may
be able to help.

Putting An Income Raise to Use

If you get a raise, rather than spending that extra money to buy something new, upgrade to a nicer apartment, or take a vacation, that extra cash could mean an extra payment on your student loans each month. The 2018 to 2019 U.S. Compensation Planning Survey , projects a 2.9% raise for employees in 2019.

Looking at Jobs that Can Help You Qualify for Loan Forgiveness

There are several types of jobs that can help you qualify for student loan forgiveness (on certain federal student loans), including working for the Peace Corps and AmeriCorps.

The Public Service Loan Forgiveness (PSLF) Program forgives the remaining balance on Direct Loans after 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer.

Employment with the following types of organizations may qualify graduates for PSLF, according to the U.S. Federal Student Aid office :

•   Any federal, state, local, or tribal government organization.
•   Not-for-profit organizations that are tax-exempt under Section 501(c)(3) of the Internal Revenue Code
•   Other types of not-for-profit organizations that are not tax-exempt provided their primary purpose is to provide certain types of qualifying public services.
•   You can learn more about qualifying employment here .

Seeking Employers that Offer a Matching Student Loan Contribution Plan

A number of companies are starting programs to help their employees pay off their student loans, including Fidelity, Aetna, PwC, Carvana, and SoFi, according to GlassDoor . Some of these employers help pay off loans while others offer a matching payment plan.

For instance, PricewaterhouseCoopers offers up to $1,200 per year toward their employees’ student loans, with a maximum of $7,200. And Aetna offers up to $2,000 in matching student loan payments for a maximum of $10,000 for full-time employees.

Refinancing Your Student Loans

Don’t underestimate the potential power of refinancing your student loans. You could end up with a lower monthly payment, or you may be able to reduce your student loan interest rate. Refinancing allows you to combine any federal or private student loans into one new loan with a new (and hopefully lower) interest rate.

And SoFi offers rate discounts to eligible members who enroll in autopay for their loan payments. SoFi offers a range of refinancing options to help optimize your monthly payments, and potentially improve your loan terms and rates.

Hoping to pay off your student loans sooner? See what refinancing your loans with SoFi could do. You can check your rates in just two minutes.

The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.
To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. A hard credit pull, which may impact your credit score, is required if you apply for a SoFi product after being pre-qualified.
This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.


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How to Handle Federal Student Loan Rate Hikes

Millions of students across the U.S. take out student loans every year as a way to finance their college education. Student loan debt in America is at an all-time high, reaching nearly $1.5 trillion in 2018. About 70% of college students graduated in 2017 with student loan debt that was expected to average $38,000 .

After years of record low interest rates, 2018 marks the second year in a row that interest rates on federal student loans have increased. Interest rates on federal student loans for undergraduates have increased from 4.45% to 5.05% for the 2018 to 2019 academic year . This student loan rate increase of 0.595% applies for any new loans taken out on or after July 1, 2018.

Student loan interest rates also increased for graduate students—rising from 6% to 6.6%. Rates on PLUS loans, which are available to parents and graduate students, increased from 7% to 7.6%.

How Does Student Loan Interest Increase on Federal Loans?

Since 2013, the interest rate on federal student loans has been set annually by Congress based on the 10-year treasury note . Each year, the new rates take effect on July 1 and apply to loans taken out for the following academic year. Under this formula, rates can increase, decrease, or remain the same.

Federal student loans have fixed interest rates, so the new rate hikes only affect new loans taken out in the 2018 to 2019 school year. Because many students rely on federal loans to pay for college every year, the increases could still result in borrowers paying more money each month, even though the interest rates on federal loans are fixed.

Assuming a 10-year repayment plan, the latest interest rate hike in July 2018 will increase monthly loan payments by about 2.8% . And although the interest rate on federal education loans remains the same over the life the loan, when a student takes out an education loan for the next school year, that loan might have a higher interest rate. Higher interest rates on student loans lead to more debt, which can make it harder for graduates to pay off their student loans.

In an effort to keep the interest rates on student loans from skyrocketing, Congress has set limits on how high interest rates can go . Undergraduate loans are capped at 8.25%, graduate loans can never go higher than 9.5%, and the limit on parental loans is capped at 10.5%.

How Does Student Loan Interest Increase on Private Loans?

If you have private student loans, the federal rate hikes won’t directly affect your loans. Most private lenders look at your credit history and income, among a few other factors to determine if they will lend to you and what rate you will qualify for. Many private lenders offer fixed and variable rates for student loans.

Often variable rate loans are tied to the one-month LIBOR, a common global index that reflects short-term interest rates and can change monthly. The one-month LIBOR rate generally rises and falls in small increments each month. As the LIBOR fluctuates, the variable rate on your loan will fluctuate as well. For example, in 2017, variable and fixed interest rates on private student loans rose nearly a point.

Private lenders generally add a margin to the rate which is determined by your credit score or the credit score of your co-signer if you have one. Depending on your lender, variable rates can change monthly, quarterly, or annually.

Even if the variable interest rate on your loan rises, you could still be paying less money in interest over the life of the loan if you pay it off in a short period of time. (Because paying it off quickly means there is less time for interest to accrue!)

On the other hand, if rising interest rates are causing your student loan anxiety to increase as well, you could consider refinancing your variable rate student loans to a fixed interest rate.

Protecting Yourself From Student Loan Rate Increases

When you refinance your student loans, you essentially take out a new loan with a new (hopefully lower) interest rate. That new loan is used to pay off your existing loans.

Refinancing your student loans can allow you to adjust your repayment timeline by shortening or extending the term length. These options can change the total amount of interest you pay over the life of the loan and your monthly loan payment, too.

If you have a mix of federal and private loans and you want to get a new interest rate, you won’t be able to consolidate your loans with the government. At SoFi, you can consolidate your federal and private loans through refinancing.

Keep in mind that if you do refinance with a private lender, your loan will no longer have federal protections like income-driven repayment plans or Public Service Loan Forgiveness.

But if you don’t anticipate needing these programs, refinancing with a private lender might result in a lower interest rate.

With SoFi, there are no application fees or prepayment penalties. And you’ll have the opportunity to choose between a fixed rate loan or a variable rate loan. Both options offer strong opportunities for borrowers to reduce the money they spend on interest depending on a variety of factors such as the total amount of the loan and the overall length of the loan.

To get an idea of how refinancing and the different interest rate options could impact your loan, take advantage of SoFi’s easy-to-use student loan refinance calculator.

SoFi is a leader is the student loan space—offering both private student loans to help pay your way through school, or refinancing options to help you pay off your loans faster.

See your interest rate in just a few minutes. No strings attached.

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The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.
The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.


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2 Members Share Their Tips For Paying off Student Loans

Paying off your student loans can feel like a grueling journey, especially if you have a lot of it. And there’s a lot of student loan debt out there—$1.5 trillion to be exact .

It’s becoming clear just how much student debt can have a negative impact on the psyche of the student debt holder. In a survey conducted by SoFi, 83% of respondents felt like they couldn’t relax due to their student loans, and 50% felt that student loan debt has made them feel depressed.

More than a third have reported losing sleep due to student loan debt, and plenty of others say that it’s caused them to miss out on opportunities to travel, practice self-care, and make major life decisions.

If you’re in the throes of student loan debt repayment, you should know that there’s hope: Catie Gould and Veronica Scafe, two SoFi members, show us that it can be done. Not only did they each pay off their nearly $100,000 in respective students loans, but did so in about four years—significantly faster than their original loan terms.

It is important to note that these results may not be typical of every person paying down student loans. Below, these two members share their student debt journeys as well as their tips to help pay off student loans.

Meet Catie Gould and Veronica Scafe, SoFi Members

If you’ve got student loans and are looking for inspiration to get rid of them once and for all, Catie Gould and Veronica Scafe are your people. Both paid down nearly $100,000 in student loan debt.

Catie Gould paid off her student loans in just over four years—an impressive feat considering she graduated with around $91,000 in student debt from her dual degrees in material science and mechanical engineering.

Veronica Scafe found herself in a similar situation after graduating with $99,800 in student loans from obtaining her Doctor of Pharmacy degree. Even though Scafe had only expected to leave graduate school with $80,000 in loans, she was able to pay off the balance in an incredible three years and eleven months.

Their Personal Strategies For Paying Off Student Loans

Right out of school, Gould and Scafe deployed similar strategies for paying off their student loans fast; they both worked hard at keeping their expenses low, even with their new, higher salaries.

When Gould graduated from school, she avoided “lifestyle inflation” even though she was making more money than she ever had before. “Not very much changed for me after graduating. I am a saver by nature. I kept driving my old car, living with roommates, shopping at thrift stores, taking local vacations.”

And Gould didn’t stop there. “I bought a bicycle to get around town, tried gardening, and cooked my own food most of the time. I said no to plenty of things, but most never felt like a sacrifice.”

It helped Gould that she didn’t have expensive tastes to begin with: “Festivals were a big thing I never knew about. I was shocked that people pay $300+ to go to weekend music festivals.”

Scafe recounts an experience similar to Gould’s. She and her husband “never expanded our lifestyle to fit our salary so we never had to make cuts.” Scafe added, “We live pretty frugally. We have a modest home. We cooked most of our meals at home and took leftovers for lunch the next day.”

Just as keeping expenses low was an important tactic for both women, so was making additional payments towards their student loans. Neither wanted the emotional burden of paying back loans for longer than they had to, nor did they like seeing so much of their loan payments go towards interest payments and not the principal.

Simply having a long, hard look at how much you’re spending in interest payments every day, week, or month, may be the motivation you need to pay your loans off faster than the standard ten-year repayment schedule.

“I sometimes calculated how much interest I owed every morning just for waking up,” says Gould. From this exercise, she noticed that the daily interest charges on her student loans cost her “more than eating out every day, which I considered pretty indulgent,” and this motivated her to take action, and fast.

Gould and Scafe also refinanced their student loans, which provided them both the extra boost they needed to pay their loans back on such short timelines. By refinancing and qualifying for lower rates, more of each payment could be applied to the loan’s principal and not just interest.

What pushed them to pull the trigger on refinancing?

When Gould started her first corporate engineering job, the company was in the midst of layoffs. Luckily, she kept her job, but she says that “the layoff had a huge impact on me.” This experience at work pushed her to explore even more options for lowering her student loan bill.

The concern of how she’d make payments if something were to happen to her job, along with interest rates that she felt were far too high—some of them at 8.75%—inspired her to tackle her debt through extra payments and refinancing.

Gould refinanced around $36,000 of her debt through SoFi. She said, “Getting out of a higher interest rate was really helpful to pay down my remaining student loan balance. I feel a lot more in control of my future and how I chose to spend my time. It’s steered my life in a direction I never anticipated.”

Scafe also knew the feeling of wanting her loans long gone, and fast. “I obsessed over them and I think that’s what motivated me to get rid of them ASAP.” Having multiple loan payments scattered throughout her month was a nuisance.

“I refinanced to lower my interest rate,” she says, but also desperately wanted to have only one monthly payment. Paying down multiple loans faster than their scheduled repayment terms was a logistical hassle, and required significant manual maneuvering. “It got really frustrating.”

Both women refinanced their loans with SoFi, lowering their interest rates and saving them money on interest while consolidating their multiple loans—both federal and private—into one loan with one easy payment.

Tips to Help Pay Off Student Loans Early

“Tracking your spending is a must,” says Gould. She used Mint to track her spending, though there are many methods of doing so. The important thing, says Gould, is to do it. “The difference between months I looked at my budget frequently and months I didn’t was about $300 to $500 of savings, just from being more aware.” And putting those savings towards a student loan payment seriously expedited her loan payoff journey.

When it comes to spending money, try to cut whatever doesn’t bring you true joy. “There is always something forgettable that you are spending money on every month that you can cut.” For Gould, one of these things was dining out. For you, it could be something different, but the lesson here is to identify what really doesn’t produce joy for you, and ruthlessly eliminate it. Spend on only what you love.

“There is no way you can cut out all your expenses, and you need to let yourself have a little leeway to feel like you are living a great life. Some treats I got myself were evening classes in things I found interesting.

I took calligraphy, pottery, Arabic, essay writing. I also have some nice camping gear. I always equated these extra things to lunches—a $10 expense that I wouldn’t miss.”

Scafe, on the other hand, extols the virtues of paying yourself first. Whether you’re paying off loans on an expedited schedule or saving up an emergency fund, it’s wise to spend what is left over after saving and not vice versa.

While you should always keep a buffer in your checking account, too much cash lying around could be just asking to be spent. You can move it towards your loans or a savings account as soon as payday hits instead.

For both women, seeing the light at the end of the tunnel was crucial to their perseverance. They stuck with it, even when it felt like student debt freedom would never become a reality.

For Scafe, having her debt eliminated has been a big stress relief. Gould says that she feels in control of her future and how she chooses to spend her time, and that nothing compares to the feeling of paying off her student debt. And while neither claim that the process was easy, or entirely possible for many on their relatively short timelines, both believe that it was totally worth it.

If you have student loans like Scafe and Gould, keep pushing to reach your goal of being debt free. You can use our student loan payoff calculator to get an idea of when your loan payoff date could be, and it’s never too late to start putting strategies in place to help accelerate your loan payoff—even if it’s just a little at a time.

Also, you can consider refinancing your student loans with SoFi to potentially lower your interest rate and get a shorter term, and therefore help to expedite your own loan payoff journey.

Refinance today! It only takes two minutes to check your rate.

Disclaimer: The savings and experiences of members herein may not be representative of the experiences of all members. Savings and experiences are not guaranteed and will vary based on your unique situation and other factors.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.


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Financial Tips for Recent College Graduates

Graduating from college can feel like the end of an era. You’re leaving behind the safety of school, and in theory, you now have all of the tools you need to make it in the real world.

While you may be ready to job search, kill it at an interview, or even start a business, many new grads aren’t sure of the best ways to manage their financial health. Here are five financial tips for new graduates.

1. Making (and Sticking to) a Budget

Make a budget. Hear us out. The b-word might make you cringe, but setting a budget is one of the most important things you can do to help set yourself up for financial success.

That doesn’t mean, however, that you need to hire CPA and create a complicated spreadsheet you’ll never look at again. Think of a budget as a tool that helps you get what you want instead of something that limits you.

For example, whether you want to start saving for retirement ASAP, or just want to save enough money to buy a couch, the first step to getting there is usually setting a budget. A key to creating a budget you’ll actually follow?

Make sure that it not only accounts for necessities like housing and student loan payments, but also includes the things you actually like to spend money on, whether it’s weekly cocktails at your favorite neighborhood bar or online auctions for rare action figures.

If you try to go cold turkey on the things you normally spend your money on, you might not have the motivation needed to set aside some of that cash for your larger goals.

One other important thing to remember is that if you accidentally spend more than your budget at first, don’t give up. Financial health is typically a process, and no one is perfect. The most important thing is that you keep trying.

If you keep struggling to stick with a budget, it may be time to take a look to see where most of your money is going and adjust your budget to make it more realistic to your individual circumstances. For better insight into your spending, get started with SoFi Relay. You’ll be able to keep tabs on your cash flow and spending habits, plus find ways to save.

2. Planning For Emergencies

Many of the financial tips for college graduates focus on saving but can leave out what, exactly, you ought to be saving for. This brings us to our second money tip for college graduates: Creating an emergency fund.

By now, almost everyone knows that most Americans don’t have enough cash saved to navigate a $500 emergency . Scary, right? $500 could be one major car repair, hospitalization, or even just an unexpected security deposit on a new apartment.

When you don’t have cash on hand to pay for emergencies, it may be tempting to put it on a credit card, which, if not paid off right away, can spiral into increasing debt.

One easy way to start is to make an initial goal, say $500. As part of your budget (See? Budgets are important!), you could set aside a certain amount monthly towards your emergency fund. Once you reach $500, take a minute to celebrate, but don’t stop saving.

Your emergency fund should ideally be able to cover about six months of expenses so that you can protect yourself if you ever face extended unemployment or serious illness.

Those numbers can certainly sound daunting, so some savers might find it is easier to set incremental goals, like aiming to first save $500, then $1,000, then $1,500, and so on.

3. Putting Down that Credit Card

We know that not everyone has a job lined up right after graduation. Post-college life can be pretty rough. We see you, recent grads crashing with friends and surviving on instant noodles while you job search. It can be tempting to rely on a credit card during times of financial uncertainty, but overusing your credit card can have serious consequences.

Unless you pay off your credit card debt right away (that is, in full every billing cycle), it continues to accrue interest, which in turn increases the amount you owe. That means that, for example, a $900 couch you charged could balloon in cost the longer you take to pay it off. On top of the extra costs of fees and interest, carrying a large balance on your credit card(s) can impact your credit score.

Instead of relying on your credit card, you may opt to save up for big purchases like new furniture, and keep spending in check by following your budget. If you must put expenses on your credit card, you can help keep added interest at bay by prioritizing paying off your balance in full every month.

4. Learning About Investing

Okay, so you’re on board with a budget and have even started to save for an emergency fund. What’s next? Financial tips for recent graduates often focus only on how to manage your money for right now, but a huge part of financial health is putting your money to work for your future.

Right after graduation can be a great time to consider dipping your toes into investing. Investing is not just for super rich old guys in suits. In fact, getting started on investing while you’re younger can allow you to grow your portfolio over time.

One other common misconception about investing is that you need a ton of spare money available to get started.

The truth is that you may be able to start investing with small amounts of money—SoFi lets you start with as little as $100 a month—and grow your portfolio over time. Intimidated by the process? Talk with an advisor who can help guide you toward the right mix of investments for your goals.

5. Making a Plan For Loan Repayment

Finally, perhaps the most timely tip for new graduates: Make a plan for repaying your student loans. You may have a grace period after you graduate. If you do, you can use that time to figure out exactly how you plan on making those monthly loan payments.

Planning for your loan payments in your budget is a great place to start, but if the monthly payment seems too high to manage, there are a couple things to do that may help keep things in check.

First, make sure that you’re on the right loan repayment plan for your personal circumstances. Federal loans offer several different options for repayment , whether you want to pay your loans off as soon as possible or keep your monthly rate as low as possible. Just remember: If you aren’t making payments to at least cover your monthly interest, your loan might actually end up getting bigger!

If the federal repayment plans aren’t doing it for you, refinancing your student loans may be another option. Refinancing your student loans is a process by which you apply for a brand new refinancing loan to pay off all your existing student loans at once. Why trade in one type of debt for another?

Student loan refinancing may help you secure a lower interest rate or better repayment terms—and that can add up to major savings over the life of your loan. Loan refinancing may be especially beneficial to new grads who have secured a well-paying job or have a better financial situation and credit score than they did when they originally took out their loans.

Recommended: 46 Tips for Recent College Grads

Whether you’re ready to take on the real world or are still trying to get your feet underneath you, taking steps to protect your financial health during this time is crucial.

Congrats, grad: You’ve got this!

Considering refinancing your student loans? With SoFi, applying is quick, easy, and all online. You could get pre-qualified within two minutes. Learn more today.

The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the
FTC’s website
on credit.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
The information provided is not meant to provide investment, tax or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. Advisory and automated services offered through SoFi Wealth LLC. An SEC registered investment advisor. SoFi Securities LLC, member FINRA / SIPC .

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Is an MBA Worth It?

Dreaming of climbing the ladder at a prestigious finance institution? Or maybe you’re committed to starting a socially-responsible environmental consulting firm. The chances are that if you’re interested in the business world, you’ve considered getting an MBA.

An MBA, or Master’s in Business Administration, is a graduate level degree that confers grads with flexible and expansive knowledge about the business world, from business development to accounting. Internationally recognized, an MBA can set you up for a career in the United States or abroad, in the private sector or even in the NGO and non-profit sector.

Designed to help you hone critical business skills, MBA programs cover a wide variety of topics, from the basics of economic theory to practical seminars on topics like sustainable development. The flexibility of an MBA means that you will be able to tailor your graduate degree to your specific interests, whether that is learning how to rise to C-suite executive or learning how to manage an international non-profit staff.

If you’re wondering “what jobs can you get with an MBA?”—know that each MBA program has different specialties and electives that allow you to hone your business leadership skills in a context that will help push your career forward.

An MBA is one of the most lucrative master’s degrees . But as more and more students pursue graduate degrees, many students may wonder: is an MBA really worth it?

How Much Does an MBA Cost?

The biggest downside to getting an MBA? The cost. The cost of an MBA degree can vary widely by school and program, but many MBA programs will cost you a pretty penny out of pocket , even if you earn some scholarships.

MBA programs can be some of the most expensive master’s degrees out there, landing grads with more than $70,000 of debt, on average. Top schools, like the University of Pennsylvania and Columbia, can cost upwards of $100,000 in tuition alone. Add in the cost of living, and you’re looking at an even higher number.

Of course, there are more affordable MBA programs. For example, the highly ranked University of Wisconsin-Madison has an annual in-state tuition of $19,162. But regardless of which program you choose, you may be looking at taking out hefty student loans to cover the cost of attendance. If you’re going to invest that much money in your degree, you want to make sure that it will pay off.

Is Getting an MBA Worth the Cost?

Even though getting your MBA is expensive at the outset, it is essential to think about how much actual value having that MBA can add to your life and finances.

Your MBA degree sends an automatic signal that you are a professional and an expert. While many business leaders rise through the ranks without an MBA, having the degree is a bonus for employers showing them you are competent and ready for the business world.

Getting your MBA can come with a serious cost, but it can also have a beneficial impact on your earning potential. In fact, the average MBA salary for 2017 graduates was $105,146 .

It’s important to calculate the return on your investment because some MBA degrees might actually cost way more than you can expect to recover in the boost to your salary. Luckily, we’ve helped take some of the work out of it for you with our annual “No BS” MBA rankings, where we surveyed SoFi members to help break down the return on investment for top MBA programs. Picking an MBA program that could give you the most bang for your buck can help make an MBA worth it.

Of course, not all business professionals need or want an MBA. MBA programs typically take two years of full-time study, which can make them impractical for many people who don’t want to (or can’t) stop working for such a long time, especially if they are already moving up the ladder in the business world.

There are some alternatives to full-time MBA programs, some offer online-only classes, while others offer part-time programs that are designed to work with your schedule while you are still working full-time.

Can You Increase the Value of Your MBA?

The bottom line? Look for a program that fits your interests and offers a great debt-to-value ratio. In addition to choosing the right MBA program, you can help increase the value of your MBA degree by thinking smart when it comes to student loans.

One significant benefit of an MBA is that it can seriously boost your salary and your finances. If your financial picture has improved with things like a solid income and consistent credit history, you may be a good candidate for refinancing. Refinancing your student loans after obtaining an MBA can help you lower interest rates, which means that you could pay less interest on your student loans and voilà—that MBA becomes even more valuable.

When you refinance your student loans, you’re taking out a new loan with a private lender which will in effect pay off your existing loans. Refinancing gives you a new, hopefully lower, interest rate, a new term length, and new monthly payments.

Instead of paying multiple student loans, you end up with a straightforward loan payment, ideally with more favorable student loan repayment terms based on your current financial situation. That means that refinancing offers take into account your new degree, your new salary, and your new financial reality.

You can maximize the value of your MBA program by minimizing the amount of debt you take on through finding a high-value program and considering refinancing your loans after graduation. In the end, getting an MBA can help advance your career if you’re dedicated to pursuing a career in business.

Whether you need help paying for school or help paying off the loans you already have, SoFi offers competitive interest rates and great member benefits as well. See what you’re pre-qualified for in just a few minutes.

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Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.
The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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