You paid your home university tuition, purchased your plane tickets, and are ready to start off on your study abroad adventure. But wait! Have you considered how you will manage your finances while overseas?
Here are some helpful tips on how to get your finances in order so you can spend more time on enjoying being abroad:
Even though you may have already got the big ticket items such as tuition and plane ticket down, you will still need access to your home bank account funds for your day to day life. Just because you’re in a new country, doesn’t mean you’re gonna stop going out. In fact, you might even be frequenting restaurants and shops more than at home. Make sure your home bank accounts are accessible in your host country. Contact your bank and inquire about international usage. While you’re at it, set up travel alerts so that overseas transaction won’t get flagged for suspicious activity and have your account frozen.
International and Foreign Exchange Fees
Even if your home bank offers international access, it may be wise to consult with them about any international and foreign exchange fees you may incur. These fees are sneaky and can add up to a sizable amount over time. International fees are additional fees added on per transaction. Foreign exchange fees manifest in a variety of forms. Your bank may charge a flat or percentage fee to convert foreign currency charges back to US Dollars or build the fee within a disadvantageous currency exchange rate. My best recommendation is to avoid the fees and fine print headaches altogether and consider banking with a financial institution that charges no fees whatsoever. Charles Schwab and local credit unions are popular choices. Make sure to do your own research to find the best option for your needs.
In many places cash is still king, businesses simply do not accept card, whether it be debit or credit. Although you may be tempted to bring a huge wad of cash and exchange it upon arriving at your host country, please do consider if that is really the safest option. In addition, currency exchange locations usually charge a fee or offer disadvantageous currency exchange rates. In my experience, the worst rates are the currency exchange booths located at airports and tourist attractions. The rates in town at banks or local currency exchangers are usually more forgiving. However, the best rates would be from withdrawing from an ATM from your home bank accountthat doesn’t charge any fees.
Lastly, you should have a travel credit card that allows you to make purchases overseas without any additional fees. Some even reward you with airline miles or points to redeem for cash. A credit card is great for purchasing things like plane tickets or high value items because you don’t have to carry large amounts of cash and some cards even protect your purchases in case of problems. In the event of an emergency, a credit card may be useful if you need to visit a hospital too. Make sure you set up a way to pay your bills on time to avoid getting hit with late fees or interest rates.
These are my tips on banking, fees, cash, and credit cards while abroad. I hope this overview will help you manage your finances while abroad so you can focus on enjoying the more exciting parts of your study abroad program.