Financial stresses can detract from your experience abroad. In particular, I struggled because I studied abroad via the multi-country program, Semester at Sea. We were in a new country every week, causing me to adjust my budget to new currencies and exchange rates continually. As challenging as this was, it was entirely worthwhile. By budgeting correctly, I was able to minimize worries about my expenses, and I was ready to embrace my experience abroad fully. With that, here are some tips for how you can budget for your study abroad program.
Have an Emergency Fund
Picture this: It is midnight, and I am alone in a foreign country. I had foolishly decided to split from my travel buddies while in Marrakesh, Morocco to explore the winding alleyways and twisting corridors of the city on my own. The soothing sun has descended, and now a chilling moonlight arises, covering me in the cold. I needed to find my way back to the hotel - fast. I checked my wallet, and I was all out of Dirham (the local currency). Thankfully, I had put aside money for an emergency such as this, and only needed wifi to transfer the funds into my account. As a result, I made it back to the hotel safely. Preparing for unexpected situations by having a financial backup plan is essential for study abroad success. I recommend saving up or storing a few hundred dollars in case of emergencies. You will be thankful you did!
Establish a Monthly Budget
By creating a monthly spending budget, you will start to notice if you are on track to spend every dollar you have before your trip ends. For instance, while in Hong Kong, I went to a world-famous tailor suit shop called Apsley Bespoke Tailors. I entered ready to bargain for a perfect price confidently...and ended up spending $600! Not only had I negotiated terribly, but I had also blown my budget. Buying this suit was definitely a splurge, but because I had established a monthly spending budget and tracked my expenses, I merely updated my budget sheet and knew precisely how much I had swayed off track. I was forced to adjust my spending for the future, and as a result, cut future expenses so that I could stay on track in the long run. For me, having a custom suit was worth it, but that's a decision only you can make!
Split large expenses with friends whenever you can
While in Vietnam, my friends and I rented out a small luxury villa and shared it among 20 students total. It was the most fun I had in years! The total bill for a week of accommodations per person: $8!! Just by splitting expenses, you can make excellent experiences more financially feasible for everyone.
Research Hostels, Transportation, and Tourist Traps before arrival
One of my friends was stranded in India. She was trying to make it to the Taj Mahal, but the bus transportation she was relying on dropped her off at an abandoned station with thirty strangers. She was understandably worried and because the buses failed to help, and she ended up paying over $500 in rupees to take a taxi for six hours to get to the Taj Mahal. Although she could not have known the bus would leave her stranded, the extra expense and the dangerous situation could have been avoided had she researched the bus company ahead of time. I instead chose a mode of transport that was safe, reliable and affordable. Spending the time to do your research will save you more money in the long run above all else. Plus, it is a life skill that you can continue to use anytime you decide to explore someplace new. Be an informed global citizen and check out resources like the Diversity Abroad Community Forums or Wikitravel to find out as much information as you can ahead of time.
BONUS TIP: Have A Recurring Source of Passive Income
If possible, try to secure recurring passive income before you go abroad. This will help you worry less about money and truly enjoy your experiences abroad. For instance, by renting your on-campus housing to someone while you are gone, earning royalties for something you created and published, or investing in high-return stocks with dividends, you can generate consistent passive income. However, the process can be risky. I invested in stocks prior to traveling in the hopes of using the return on investment to fund my travels. Instead, I lost several hundred dollars. Choose wisely!
In conclusion, budgeting can be a tricky process. Do not overcomplicate it. By simply having an emergency fund, tracking your monthly spending, doing your research and splitting expenses with friends, you will alleviate the majority of your financial stresses, allowing you to delve into your life-changing experience abroad without any distractions!
Authored By: Austin Joseph