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Budgeting and Money Management

Managing your finances while studying abroad is essential to making the most of your experience. Study abroad may be your first time creating and sticking to a budget in a new currency, country, and culture. This page will guide you through planning, managing, and saving money while abroad. You'll learn how to access money, track your spending, and keep your finances secure so you can focus on the adventure of studying in a new place.

Budgeting & Planning Step-by-Step Budgeting Process Money Management

Budgeting & Planning for Study Abroad

Understanding Your Costs

Before you embark on your study abroad adventure, it’s important to have a clear understanding of how much things will cost in your host country. Study abroad budgets can vary greatly depending on your destination. Western Europe, Australia, and Japan tend to have a higher cost of living, while rural areas can be more affordable. Your program’s webpage will provide estimated costs for food, airfare, and living expenses. It's helpful to also consult country-specific guides and reach out to returnees who studied in the same country for insights into real-world spending.

  • Research Costs in Your Host Country: Use resources like expatistan.com or program pages to compare the cost of living in different countries.
  • Talk to Returnees: They can offer insights on how much they spent on daily expenses, entertainment, and travel.
  • Check Program Estimates: Your program’s brochure will have details about estimated expenses in your host country.

Step-by-Step Budgeting Process

Step 1: Learn How Much Things Cost
Knowing how much things cost in your host country is key to creating a realistic budget. Research common expenses such as food, transportation, entertainment, and travel costs.

Step 2: Plan Your Budget
Creating a budget before you depart is crucial. You can use a budget worksheet or apps like Mint or Numbeo to track your expenses. It's a good idea to familiarize yourself with the conversion rate or use a currency converter app, like OANDA Currency Converter, to monitor your spending in U.S. dollars or your home currency.

  • Financial Aid: If you're receiving financial aid, consider scheduling a one-on-one budgeting session with the Office for Undergraduate Financial Aid before departure to review your aid package and how it will impact your budget.

Step 3: Plan for Pre-Departure Costs
Before you even leave, there may be up-front costs for your program (visa fees, flights, vaccinations, etc.). Make sure to budget for these expenses in advance.

Step 4: Save Money While Abroad
Once you’re abroad, continue to be mindful of your spending to make your budget stretch. Consider various tips for managing costs like food, toiletries, and transportation.

Money Management While Abroad

Accessing Money Abroad

You’ll need to use a variety of payment methods while abroad—cash, ATM cards, credit/debit cards, or mobile payments. Research which methods work best based on your bank or credit card company and the host country’s financial infrastructure.

General Tips

  • Carry Some Cash: Bring a small amount of U.S. dollars (around $100) to cover initial expenses like taxis, snacks, or phone calls when you first arrive. Some U.S. banks can provide foreign currency in advance, or you can exchange dollars for local currency at international airports or local exchange houses.
  • Understand Exchange Rates: Familiarize yourself with the exchange rate and how the local currency compares to U.S. dollars. This will help you gauge the cost of living and prevent overspending.
    • If the U.S. dollar is weaker than the local currency, expect a higher cost of living.
    • If the U.S. dollar is stronger, you may enjoy a lower cost of living.

Cash & ATMs

  • Cash: Many places, especially in smaller towns, may not accept credit cards for small purchases. It’s essential to have cash in the local currency for these situations.
  • ATMs: ATMs are one of the easiest and most reliable ways to access money abroad, but be aware that your bank may charge withdrawal fees. Always check with your bank about any additional fees and daily withdrawal limits.
    • Some U.S. banks have international “sister banks” that won’t charge withdrawal fees. Ask your bank if this is an option.
    • If using your U.S. debit card abroad, ensure it has the EMV chip for compatibility with international ATMs.
    • Always check your PIN compatibility—some ATMs won’t accept 4-digit PINs, and some may reject PINs starting with "0." Consider changing your PIN if necessary before leaving.

ATM Safety

  • Be Vigilant: ATMs can be targets for theft, so be cautious when withdrawing money. Avoid large withdrawals and only carry what you need at the time.
  • Secure Your Funds: When withdrawing money, take extra care not to expose large amounts of cash in public spaces. Review additional safety tips in the Safety & Backup Plans section.

Credit Cards

  • Limited Acceptance: Credit cards may not be as widely accepted in some countries, especially for small transactions. Additionally, some banks charge international transaction fees.
    • Contact your credit card company to inquire about any fees and notify them of your travel dates.
    • Visa and MasterCard are more widely accepted internationally than American Express.
    • If you plan to use your card abroad, consider bringing at least one backup card for emergencies.
  • Chip-and-PIN Technology: In many countries, especially in Europe, credit cards use chip-and-PIN technology, which differs from the U.S.’s magnetic strip and signature method. If you don’t have a chip-enabled card, contact your provider to inquire about getting one before departure.

Mobile Payments

  • Common in Some Countries: Mobile payment systems like PayPal, Venmo, Apple Pay, Google Pay, WeChat Pay, and AliPay are becoming increasingly popular and may be accepted in lieu of cash or credit cards.
  • Research Your Host Country: Check if mobile payments are commonly used in your host country. Although they are convenient, security is a concern, so ensure you follow safety precautions (check the Safety & Backup Plans page for more details).

Not Recommended

  • Opening a Foreign Bank Account: Generally, it’s not necessary nor feasible to open a local bank account unless you plan to stay for a year or more. Most students find it easier to use their home bank account through international ATMs.
  • Traveler’s Checks: Although safer than carrying cash, traveler’s checks are becoming increasingly difficult and expensive to cash abroad.
  • Personal Checks: Personal checks are nearly impossible to cash internationally and can be extremely costly to process.
  • Currency Exchange Counters: While they may seem convenient, currency exchange counters often charge high fees on top of an inflated exchange rate. It’s better to withdraw cash from an ATM or exchange money at a local bank.

Keep Your Money Safe

Unexpected situations can arise, so it’s essential to have backup plans in place. Ensure you have access to money through multiple methods (e.g., debit cards, credit cards, emergency funds) and always store your valuables securely.

Spend Wisely

Once you’re abroad, try to stick to your budget as closely as possible. Look for ways to save money in categories like food, toiletries, transportation, communication, and entertainment. If your program offers meal plans or discounts, take advantage of those options to minimize costs.

Tips for Spending Wisely

  • Cost-effective Transportation: Choose cheaper forms of transportation like public transit over taxis.
  • Cook Meals: Prepare your own meals rather than dining out every day.
  • Use Discounts: Leverage student discounts and apps to find local deals on transportation, entertainment, and dining.