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JULY 22, 1999 B-SCHOOL Q&A: FINANCIAL AID Meet USC's Financial Aid Director A Conversation with Grace Kim, Associate Director of MBA Admissions at USC's Marshall School of Business
Grace, how much does it cost to attend USC Marshall for one year? Currently, the annual budget for our incoming first-year students is $40,246. That includes tuition, as well as living expenses for nine months. The tuition is about $26,000, and the rest -- $22,000 or so -- is comprised of living expenses. And that budget has risen steadily over the last couple of years. Last year it was about $39,292, so it rose by about $1,000. How much does two years in the full-time Marshall MBA program cost when factoring forgone income into the student budget? You're talking about $40,000 for two years in a row, which adds up to $80,000. Then, two years of forgone income -- on average our incoming students make about $45,000 a year -- works out to about $90,000. So you're talking about a $170,000 investment, which hopefully within the first two to three years after graduation, they will recoup. It's a sizable investment, but a potentially lucrative one. Absolutely. The way we look at it and the way students should look at it is that they are investing not just for the short-term, meaning the two years that they're here, but also for the long term -- 5, 10, 15 years down the line, when they're in a position where they're making $170,000 or $200,000 a year. What, Grace, is your role in helping students secure financial aid, easing that $170,000 financial strain? My role here is to assist students in providing them with the best [admissions] information possible and to play a liaison role between students and our financial aid office. A lot of students come to me, and they say, "I've never been through the financial aid process in my life because my parents paid for everything when I was an undergrad, and I don't know, this is a black hole for me." What we want to do is demystify the process and give them the straight ABCs. We want to make the aid process as simple for students as possible. So my role here is to try and answer all of our students' burning questions. It sounds like financial aid is very closely allied with Marshall's admissions office. Do you help determine whether an applicant is admitted and whether he or she qualifies for financial aid? I help determine the admissions, but I don't actually do the aid portion. What happens is once students apply, all of their information is kept in the financial aid office, and the financial aid specialists are actually the ones who determine how much a person is going to be aided. We have a general rule of thumb that a student will get, hopefully, the maximum $18,500 through the federal Stafford Loan. Then, they'll cover the remaining $22,000 through private lenders. Some people have a little bit less or more than that, depending upon their particular situation (i.e., married couples, couples with children, etc.). First and foremost, I would imagine students are interested in Marshall's scholarship or fellowship opportunities, given that those are the types of awards that don't have to be paid back. Right. We have several different kinds of scholarships or fellowships -- we use the two terms interchangeably here. Fellowships are merit-based -- no need is factored in -- and can range from half to full tuition. We also participate in the Consortium for Graduate Study in Management, which is a minority fellowship opportunity. Students don't need to go through a specific application process for the institutional fellowships. Everyone that is admitted goes through an automatic fellowship process where we take a look at their application and, based on merit, offer them a varying award that can be worth, say, a half tuition or two-thirds of tuition depending upon the student's qualifications. How many students annually garner that fellowship aid? About 20% of each class. Our class size will be about 300 this year, and 20% of those students will be on some sort of fellowship aid. How does the school determine who to give fellowship aid to? We look at admissions criteria (i.e. GPA, GMAT, undergraduate institution, undergraduate major, work experience, etc.), as well as things such as an individual's varying degrees of leadership experience, managerial potential, and international exposure. Most of what we need to determine a person's fellowship award is on the admissions application. How many full tuition scholarships are available at Marshall? That really depends from year-to-year. We have a budget of about $2.5 million dedicated to scholarship aid, and how we use it depends upon how many qualified people we deem deserve a full fellowship per year, a half-tuition fellowship per year, or two-thirds fellowship per year. There's no set number as to how many per year we offer. Do all of Marshall's students qualify for fellowship? Yes, everyone does, both domestic and international. Does Marshall offer more fellowships to its first-year students than to its second years? Do fellowship awards carry over to the second year? There is a carry over. If you receive a fellowship during your first year, contingent upon having good academic standing, it will be renewed for the second year. A student who has not received a fellowship during his or her first year will not be eligible for one during his or her second year, however. It doesn't work that way. So if you miss the scholarship boat during the first year, you can forget about it for your second year? Right. How early should students apply for Marshall's scholarships? We suggest that students apply for the first three rounds of admission to be considered for fellowship. Does that mean that someone who applies to the fourth and fifth round will not get an opportunity to get a fellowship? No. As I mentioned earlier, everyone who's reviewed for admissions gets reviewed for fellowships. However, we do recommend that you apply early, normally in the first three rounds. [Editor's note: USC Marshall will have five admissions deadlines for its 1999-'00 application cycle -- Nov. 1, Dec. 6, Jan. 10, Feb 7, and Apr. 1. The school's recommended fellowship date is Jan. 10, 2000.] Does the amount of aid available decrease moving through the admissions cycle? Yes, when we get towards the end, there is a smaller percentage of people who actually get fellowships because there is a limited amount of funds. That's the reason we suggest that you apply for the first three rounds. But, again, we will try to put some money together for any exceptional candidates who apply to rounds four or five. Does the school target any specific student population for fellowship? As I mentioned, we're part of the Consortium, and we try to attract qualified minority candidates through that. Aside from that, we don't target a special group. For international students, the price tag of an MBA seems insurmountable. There are only so many people who receive scholarship aid and private banks are less likely to lend to foreigners given the increased risk involved. Does USC offer any alternative programming that makes it easier for foreigners to take out a loan? We don't have any special loan programs aside from the regular avenues where banking institutions require internationals have a U.S. citizen cosigner. However, we are at this point discussing [doing something like] that. We do understand that international students, more so than domestic students, have a larger burden because they have to move from a different country, which costs money. They have to have additional funds in order to cover their living expenses, along with a new car or what have you. So we look at them for merit-based scholarship and see who and what we can award, whether it be worth half tuition, two-thirds, or full. Does an international student who has graduated from a prestigious U.S. undergraduate college and worked in the United States, say, at a multinational company, increase his or her odds of receiving a loan? I don't believe so. I think lenders' major criterion is repayment: "Are we going to be able to collect our funds from the person?" The major criterion is that [international students] actually find someone who is a U.S. permanent resident or U.S. citizen [to be their cosigner]. I don't think that those specific criteria that you mentioned actually affect a lender's mindset. What other MBA financing options are available to Marshall's foreign students? The best thing for them to do is to surf the Internet and see where there are scholarships specific to their needs. There are hundreds of scholarships available that even we school administrators don't know about. They run the gamut. For example, one person of Chinese descent gave money to a specific international student here who graduated from [the benefactor's] undergraduate institution. Frequently, those types of obscure awards can be found using the Web. Are there any Web sites you find particularly useful? We tell students to do a basic search in Yahoo, through the education area, to see if there are listings. Some of the lenders that we work with are also pretty helpful to our international student population. For example, the Nellie Mae and MBA LOANS people are pretty good at trying to fund international students and/or domestic students. CitiAssist and the Access Group also help our students with their loans. Does Marshall have assistantships available to its students? We do provide assistantships. There is no central office, however, that handles that. Second-year students who want to be teaching assistants need to approach the individual academic departments. The department faculty and staff coordinate how students go through the process. Assistantship positions pay an hourly rate that varies depending on the size of an academic department's budget. A conservative estimate is that 25% to 30% of the second-year class grabs a TA position. Are assistantships restricted to second-year Marshall students? We do not recommend that first years take on assistantships because of the workload, though they can if they so choose. Normally first-year students do not take them on, though. Financial aid, as you mentioned at the top of our conversation, can often vary based upon the size of a student's family or on an individual's marital status. How does that work? The annual student budget -- regardless of marital or familial status -- is $40,246. If a student has significant financial obligations beside him or herself (i.e. family dependents) then we encourage them to write an appeals letter to the financial aid office itemizing what their expenses are and asking them to reconsider their total annual budget. The financial aid office will try to work with them to increase their budget so that they are allowed to borrow more. Does the school itself have any institutional money set aside for its high-need students, including those with dependents? No, we do not. Does Marshall offer any services to student spouses and significant others, such as help with finding a job? We don't have a specific program with regards to that. However, more than a couple of students' partners work on campus to help with costs -- as the spouses work, they get tuition remission. There are spouses who do that, but they're basically on their own. We do not assist them in finding a position. We do have a human resources department that is helpful. And also, if we hear of any jobs we'll pass those opportunities along on a one-on-one basis. I might hear of a job opening, know of a wife that wants to work, and suggest that she check it out. There isn't a program specifically set up to administer that though. Does Marshall provide any child-care and health-care amenities? There's a cheaper form of health care for a family, and we do have very good health care here. Students can sign up for that. They would pay, obviously, a premium, but it would be cheaper than going to COBRA or what have you. There isn't a specific day-care program for the students' children here on campus or near any of the associations with USC. Are there any other routes cash-strapped students bound for USC Marshall should consider? In taking on the two-year cost of an MBA, students should consider applying and starting the financial aid process early so that they can increase their chances of receiving aid, see how much budget they're going to get, and what types of loans they're going to be able to acquire through the year. Bottom line: Students should make a financial game plan early on and stick to it. Students should also sit down and think carefully about what they're getting themselves into. Some students don't realize the expense of going to school for two years. It's important to do the research and prepare ahead of time. Thanks much, Grace. Thanks. If you'd like to learn more about the Marshall financial aid program, you can visit the school's Web site at: www.marshall.usc.edu/main/graduate/MBA_fulladmit.htm  Nadav Enbar  | | Learn about your online education options |
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