Studying abroad involves various expenses. To manage finances effectively, it's essential to track monthly expenses, adhere to a strict budget and cut back on unnecessary costs. Students should budget for outlays beyond tuition fees, including pre- and post-departure costs, to avoid financial stress.
How to estimate expenses
To get an idea of the spending required, students can start by checking the university website, which often provides approximate living expenses beyond tuition fees, including costs such as books and medical insurance. Additionally, joining student forums can offer valuable insights from those who have already experienced life at the university, helping to get a more accurate picture of overall costs.
Reaching out to acquaintances who have experience living in the destination country or city can also yield valuable advice.
The cost of living is different in each city, so it makes sense to go to the website of the government concerned to factor in what it would be like in the city where the university is based.
When calculating expenses for studying abroad, also consider the destination country's inflation rate and potential fluctuations in foreign currency exchange rates against the rupee.
Here is a quick check list for estimating costs for studies abroad:
Pre- and post-departure expenses
Expenses for studying abroad can be broadly categorised into pre-departure and post-departure costs, covering both academic and personal needs.
When applying to US universities, students should factor in application fees, which average $150 per university, varying by course or programme. If you are applying to five universities, this could total around $750 (approximately Rs 64,000).
Students studying abroad need health insurance, which can be purchased in India before departure or through their university. Indian policies cost Rs 20,000-50,000 annually, while university plans range from Rs 50,000-Rs 1 lakh per year.
Students should also budget for living expenses such as rent, groceries, transportation, phone bills and return travel for semester breaks or holidays.
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Accomodation
Off-campus accommodation costs and security deposits can vary greatly depending on the city. Rent in smaller US towns may be around $700 (Rs 60,000) per month, while in cities like New York, San Francisco or Chicago can be as much as $2,500 (Rs 2.14 lakh) per month.
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External coaching
Some students may need extra coaching or tuition in their initial semesters due to differing academic backgrounds. Education loans typically cover expenses like tuition fees, living costs, health insurance and study materials. Some lenders, like Bank of Baroda, also consider additional costs such as laptops, stationery, lab fees and study tours.
Banks typically don't cover external coaching fees in education loans, so students requiring additional subject support need to budget for these costs separately.
Plan for travel and short trips
Students should consider budgeting for short trips and weekend travel, which can cost between Rs 10,000 and Rs 25,000 per trip, depending on the location and activities. Additionally, semester breaks may involve costly flights back to India, ranging from Rs 60,000 to Rs 1.5 lakh per round trip, although advance booking can help reduce costs. It's also crucial to budget for emergency trips, which can be unexpectedly expensive. Maintaining a separate emergency fund can provide a financial safety net for such situations.
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Impact of rupee depreciation
A cheaper rupee can raise the cost of foreign education, even if tuition fees remain the same in dollar terms. It also affects living expenses like groceries, travel and accommodation. However, currency fluctuations are unpredictable, making it challenging for students and parents to accurately budget for overseas education. This may require students to be more mindful of their spending habits and explore cost-saving options.
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