Some of the best experiences in life include exploring new environments and experiencing different cultures — that’s why study abroad programs for students are so valuable.
The problem is these programs aren’t cheap. Many parents look for additional ways to help cover their child’s program, such as ensuring they apply for scholarships and looking into their best credit card options.
As a parent, your first step should be helping your child account for all of the cost factors of the program, including building a budget.
Typical cost breakdown of a study abroad program
Study abroad programs can vary in length and cost, depending on what high school, college or organization is running it. Here are example costs from some popular study abroad programs available in 2019:
|Sol Education Abroad||Semester, Spanish immersion in Heredia, Costa Rica||$8,195|
|American Institute for Foreign Study Study Abroad||Semester, general studies in Barcelona, Spain||$12,995|
|IES Abroad||Semester, music studies in Vienna, Austria||$21,625|
Build a budget
It can be frightening to send your child abroad for the first time. Whether they’re studying Hispanic Linguistics in Argentina or interning for a semester in London, it’s important that they’re financially prepared for their months away from home.
Michael D. Izbotsky, financial planner, owner and CCO of From Planning to Living LLC suggests working a part-time job or side hustle to start building a fund for the trip.
“I think a minimum goal should be at least $1,000 for each month you are abroad, excluding rent/dorm and tuition costs,” says Izbotsky.
By putting away money each month, students can be better prepared for costs outside of the program, such as excursions and hostel stays, day-to-day activities, eating out and more.
Funding options to help your child study abroad
There are a variety of ways to help fund a study abroad program, outside of cold hard cash from yours or your child’s bank account. We’ve outlined a few of the most popular techniques below.
Scholarships, grants and stipends
One of the most common methods of reducing the cost of study abroad programs is applying for scholarships and grants.
If your child is attending a program through their college or university, the first place to check for scholarship and grant opportunities should be the college’s office of global education, foreign language department or study abroad website.
Organizations like NAFSA, the National Association of International Educators, also offer resources for students looking to apply for study abroad-focused scholarships and grants. You can find funding options based on need, scholarship, diversity and more.
Federal financial aid may also be used to study abroad. The amount you can earn towards your program depends on its length and your status as a student (part-time, full-time, undergraduate or graduate).
Stipends for studying abroad are usually gained through research or internship-focused study abroad programs and will most likely be outlined in the program description. You can expect a stipend to cover living expenses like housing, meals and transportation.
Websites like GoFundMe allow you to raise money for events by creating a campaign, setting a fundraising goal and sharing with friends on social media, email and more.
Some study abroad programs offer their own crowd funding options, such as GlobaLinks Learning Abroad. Whereas larger crowdfunding platforms typically take a portion of your donations, GlobaLinks ensures that 100% of the donations you earn are applied to your program.
Helping your child manage their finances abroad
Things can easily go awry abroad; pickpockets can steal a wallet, a flight or bus can be missed or a visit to the doctor at a foreign hospital may be in order. That’s why it’s important to have a financial plan in place should anything happen.
A credit card is a perfect way to ensure the protection of your child’s bank account and provide extra aid should an emergency occur during their trip.
“I’d recommend using a credit card as much as possible — one with no international transaction fees, of course. That way if you lose the card or it gets stolen, no one has direct access to your bank account,” says Christine Centeno, financial planner and founder of Simplicity Wealth Management.
Let your child use your card as an authorized user
If you’re interested in a credit card for your child but don’t think they’re ready to own their own quite yet, consider making them an authorized user on your card. They won’t need a specific credit score if any, and you’ll be able to set a spending limit for them as the primary cardholder.
As an authorized user, your kid will be able to charge purchases to the card but won’t be responsible for making payments. Keep in mind both you and the authorized user will share the same line of credit.
Look into a student or starter credit card
With a student or starter credit card, your child can hold the reins on their finances and build their credit in the process. To ensure a card is a good fit, take into account the following perks:
No foreign transaction fees
The Discover it® Student Cash Back, for example, doesn’t charge any foreign transaction fees and offers 5% cash back on different rotating categories each quarter like grocery stores, restaurants and Amazon.com (up to the quarterly maximum of $1,500, then 1%, activation required).
In addition to no foreign transaction fees, the Discover it Student Cash Back card offers a stellar welcome bonus. At the end of your first year of card membership, Discover will automatically match all of the cash back you’ve earned. This bonus could potentially help cover a flight to and from a study abroad location.
Another option is the Bank of America® Travel Rewards credit card. This card offers a 25,000-point bonus when you spend $1,000 within your first 90 days (worth $250 when redeemed for travel statement credit) and doesn’t charge an annual fee.
Consider a debit card or prepaid travel card
If your child is traveling to a less developed country, you might consider prepaid and travel card options, should they not already own one.
A debit card not only allows your child to withdraw cash but ensures an added layer of protection in case they lose their credit card. When looking for a debit card for your child, stick to a card that doesn’t charge foreign ATM fees, especially if your kid plans to mainly operate on cash.
Prepaid travel cards
Similar to a debit card, a prepaid travel card allows you to make purchases and withdraw cash from an ATM with the card. Prepaid cards differ in that they aren’t linked to a bank account and require that you load a specific amount of money onto the card.
Visa and Mastercard prepaid travel cards, in particular, will protect your child from fraud should their card get stolen.
Before they leave the country
There are a few final steps you and your little world traveler should take prior to them leaving the country to ensure a safe and trouble-free journey.
Inform issuers of the trip
Make sure to inform any credit card issuers that your child will be abroad. Giving the issuer a heads up as to where they’ll be studying and for how long is critical. Otherwise, their card might be frozen due to a suspected unauthorized transaction.
Take note of your child’s account information
Talk to your child about safeguarding their account information abroad prior to their trip. It’s also important for you or another relative to keep their account information in a safe place at home in case of an issue. Should your child get into a pinch, you could transfer funds into their account.
If the country your child is traveling to doesn’t accept U.S. dollars, head to your local bank and exchange a few hundred dollars for whichever currency they’ll need most of abroad.
Doing so at a familiar bank, rather than an exchange booth in a foreign airport, can save your child from a significant amount of money in exchange fees.
To see how much the U.S. dollar is worth in the country your child is traveling to, try out the currency converter below.
Currency Converter by OANDA
The bottom line
A study abroad program can be a once in a lifetime trip for your child — one that leaves them with priceless experiences, knowledge and friendships. To recap, here is what you and your student traveler need to know prior to their trip:
- Have your child build a budget and start saving with a part-time job
- Look into additional funding options like scholarships, stipends and crowdfunding
- Consider adding your child as an authorized user onto your credit card or have them apply for a student or starter card
- Before they leave for their trip, inform the issuer, save their account information and exchange currency
By following these tips, your child will be fully prepared for the moment they step off the plane and into a new country.