Financing an International Education
Read these helpful tips to find out how you can finance an international education.
The benefits of an international education are enormous, which is why parents are increasingly considering sending their children abroad for higher education. According to research by HSBC (2017), 42% of parents consider a university education abroad for their child. Popular countries of choice include the US, Australia, the UK and Canada, with over one million students pursuing tertiary education in the United States.
Based on the country and university a student chooses, fees and funding can vary. For instance, studying an undergraduate degree in the US varies for public and private colleges and universities. For the year 2017-18, the tuition fees at private colleges for a four-year degree averaged at $50,000, including the cost of accommodation.
Typically, postgraduate degrees cost significantly more than undergraduate courses. In fact, Times Higher Education (2017) noted that there was no upper tuition fee limit for postgraduate courses in the UK. The study further states that an undergraduate degree in medicine can cost up to £38,000 per year. Research by HSBC (2017) suggests that 39% of Asian and GCC-based parents favor the UK as an international education destination, while 47% parents look to the US for quality higher education.
Other favored destinations for higher education include Germany, France, Japan and Singapore. According to parents, the main benefits of education abroad include:
- Gaining international work experience
- Developing foreign language skills
- Exposure to new experiences, ideas and cultures.
Research has also shown that around 39% of parents have specific universities in mind and are attracted to them based on the quality of education, reputation and the fact that they open up employment opportunities for their child. In such cases, pre-planning and budgeting higher education expenses plays an important in role in determining whether you can afford to put your child through an education at an institution of your choice. Knowing your child’s abilities in addition to knowing how much you can save up for the right time are key factors in influencing study abroad decisions.
Budgeting for and financing an international education can be tricky. Therefore, it is vital that parents have a clear plan of action in order to pay for their children’s education. A range of options are available:
- Scholarships: If your child has excelled both academically and socially, they will be eligible to apply for scholarships when making university applications. Most universities offer scholarships to excellent students based on merit as well, however, scholarships worth a significant amount usually require an application form to be submitted alongside a short essay stating reasons for eligibility.
- Early Savings Plans: To give your children the best education available, planning needs to begin early. Consider opening a dedicated savings account designed to help you save more for university education. Several banks offer savings accounts with good interest rates and also discourage spending by not providing you with a debit card or check book for the account. The key is to start early – the earlier you start putting money aside, the less reliant you are on loans and other forms of borrowed funds later.
- Loans: Banks across the world have several educational loan options to choose from. Some guarantee covering the entire cost of tuition with easy payment plans and low interest rates.
- Fixed Deposits: Most parents usually consider fixed deposits (FDs) as a viable saving option. Fixed deposits offer a higher rate of interest than a regular savings account until a maturity date and in some cases, opening a new bank account may not be required. Typical interest rates for fixed deposits lie between 4% and 7.25%.
- Financial Aid: Most universities offer bursaries or financial aid options to academically sound students who are unable to pay tuition. It’s a good idea to check with the university what loans, grants and aid they offer.
- Children’s Savings: We’ve always heard that being financially sound can help you in times of need. Parents should also encourage their children to start saving early so they understand the value of money and also feel proud about contributing to their education, thus lowering the toll it takes on their parents’ savings.
Work-Study Job: Another way to encourage your children to save and fund their education is for them to work part time while at university. Not only will this help them develop necessary work skills, it will encourage the concept of saving and working alongside people from different cultures in harmony.
It is also important to go beyond just the tuition fees. Accommodation, transportation and learning materials are just some of additional costs that will need to be covered during your child’s time at university. In such cases, here are a few things to do:
- Research: Take the time to go online and look for lifestyle comparisons while studying internationally. For instance, if you’re looking at the UK for higher education, it is wise to research university options and the life in each city. It is also important to compare course rankings as opposed to overall university rankings as some universities have a higher quality of education for a particular course of study, despite being ranked lower than most others.
- Speak to education advisors: Specialists in the field of education can guide you a little better in making smart choices when it comes to university, understanding costs and also giving you more information about specific courses or cities. Since they help place students at universities each year, their feedback and insight is valuable in understanding your options.
- Attend open days: If a university is holding a seminar or an open day near you, or you have the chance to visit the campus and speak to faculties, participating in it will give you a better idea of what to expect and possibly, how to prepare your child for what lies ahead.
- Get in touch with alumni: Students who have graduated and are in full-time jobs will also be able to share their experiences during their time at university. If you know someone in your family or through mutual contacts who has studied at a university you’re researching, be sure to have a chat with them to gain valuable, first-hand information that wouldn’t be available otherwise.
Being an active part of your child’s education journey is vital as a parent, especially if they are considering an international education. Not only do you want to ensure that your child gets the very best, but you also want to feel reassured that your child is in a safe space and is growing into a well-rounded individual. No matter which country you choose for higher education, make sure you’re on top of things from the very beginning. It will help prevent roadblocks and contribute to a positive overall experience for you and your child.