Living and learning in a foreign country is a great way for college students to broaden their horizons and gain global experiences. Studying abroad is becoming more common as colleges increasingly require students to spend time overseas and as more entry-level positions look for this on a résumé. It’s important to plan for the added expenses that come with studying abroad to make the experience rewarding for your student and your finances. Here are a few things to consider:
Make sure you understand the program costs. Some colleges strive to make programs equal to your usual tuition payment; however the program costs may vary with the country and length of program. Many programs require a 10 to 20 percent down payment when your student applies for it, and you may need to submit installments in the weeks leading up to the program.
Check with your son or daughter’s financial aid office to ensure any current scholarships and loan dollars follow him or her overseas. If your student received third-party scholarships, notify the organizations about your child’s plans as well. Encourage your student to ask if his or her college has special funds available for study abroad programs. It’s also important to research third-party scholarship opportunities.
Cost of living
Ask if room and board costs are included in the program, or if they are an additional expense. If your student is responsible for securing his or her own housing, costs may vary based on the city and style of living. Work with your student’s study abroad office to find the best fit for your student’s safety, desired cultural experiences and budget. Keep in mind that housing and spending money will go further in a country with a lower cost of living, particularly in a strong dollar environment.
Cell phone coverage
Most cell phone companies charge a premium for international calling and texting—and that’s only if the phone is compatible with international networks. Contact your cell phone carrier to determine if your student’s cell phone will work overseas and if additional charges apply. Web-based telephone services such as Google Voice or Skype may be an economical alternative.
Check to see if accident and sickness insurance is included in program fees. If your child has ongoing healthcare needs, you may need a supplemental policy as basic insurance may not be enough. Educate your son or daughter on how his or her insurance will apply overseas, so he or she understands when to pay for healthcare expenses out of pocket.
Remember to factor transportation expenses into your budget. Expenses may include flights to and from the host country and daily public transportation while your child is in the program. Talk to your student about their desires to travel more broadly within the country or region they are studying in, and add those to your budget, as well.
Consider bringing your child to meet with your financial advisor, who can help you plan for your student’s essential and unexpected expenses while overseas. Planning for all aspects of studying abroad will allow you to feel more comfortable financially, enabling your student to have an experience he or she will treasure for years to come.
William “Drew” Watson CFP® is a Financial Advisor and Private Wealth Advisor with Ameriprise Financial Services, Inc. in Owensboro, KY. He specializes in fee-based financial planning and asset management strategies and has been in practice for 20 years. To contact us by phone, please call 270-684-8424, or mail to 111 West 3rd St, Owensboro, KY 42303. You may also visit our website at www.williamawatson.com.