The United States is an incredibly popular location for students all over the world wanting to gain a great education abroad. As there are more and more international students studying in the U.S., a common experience emerges: money mistakes. Everyone has made mistakes with money at some point or another, sometimes you just #TreatYoSelf a little too much! However, when you study abroad in the United States and you’re away from home, particularly when you’re a student on a budget, a mismanaged budget can make or break your experience, and you’ll need all the funds you can get.
A little bit of research and preparation can go a long way when figuring out how to be budget-conscious as an international student studying in the U.S. (without sacrificing any fun!). After all, you’re less likely to make a mistake if you know what to avoid.
Here are five of the more common money mistakes international students studying in the U.S. make:
1. Not Understanding Foreign Exchange Rates
Money for international students can be a little tight. Foreign exchange rates make all the difference in the spending power of international students between one country and another. Students coming to study abroad in the U.S. from countries with a relatively strong currency won’t have many problems. Their spending power will be the same (maybe even better) compared to what they have at home. However, students coming from countries with weaker currencies will want to be sure they aren’t outspending their means by keeping track of foreign exchange rates. Otherwise, they could find themselves quickly running out of cash.
2. Not Alerting Credit Card Companies
Using student credit cards makes sense for international students (if they qualify!). A credit card can help manage basic expenses until students can pay off the full amount of their balance when they go home. Most credit cards can be managed online, which makes managing things a little easier to manage away from home.
However, using credit cards internationally can get tricky if you don’t plan ahead! When you study abroad in the U.S., choose a card without international transaction fees, and alert your credit card company when you’ll be traveling back in and out of the country. This way, the company won’t flag transactions as potentially fraudulent when they suddenly start coming in from another country.
3. Paying Tuition by International Wire
Most international students at U.S. colleges pay full tuition because they can’t get federal student loans or scholarships, or because they don’t need to apply for them. This is usually okay, but becomes a big problem if their international wire transfer doesn’t get to their school in time or doesn’t have their name attached to the money.
International wire transfers have the tendency to eat away at student’s chunk of change as fees between the banks add up. On top of those fees, students also have to deal with the problem that information may get erased from the payment before it reaches the bursar’s office, which can result in serious tuition snafus.
Luckily, more services are becoming available for international students studying in the U.S., who can band together mass international money transfers that get better rates and keep things more organized. Make sure to do your research and see how you can best transfer money directly when you study abroad in the United States.
4. Not Understanding International Student Loans
The majority of American students take out at least some student loans to fund their educational experience. Because of this, international students studying in the U.S. may assume that those same loans are available to them as international student loans.
Unfortunately, since the bulk of affordable student loans is backed by the federal government, these loans are available only to U.S. citizens and permanent legal residents. You may be able to get a student loan from a bank, as long as it’s signed by a citizen or permanent legal resident who has good credit. This is definitely a bummer, but make sure to do your research on international student loans so that you have all up-to-date knowledge on the student loan resources and money for international students available when studying abroad. If you’re not quite sure where to begin, GoAbroad’s Study Abroad Loans page is a good place to start research on international student loans.
5. Paying Full-price Tuition Without Doing Research
American schools love to attract foreign students who want to study abroad in the U.S. for a variety of reasons, one of them being that these students typically pay full-price tuition. Even if you have the means to take the more expensive route and pay full tuition for a school, it’s important to make sure this choice makes sense for you. Your education is a major investment and should be treated with great care.
Research your choices wisely and thoroughly — ideally by visiting the campus ahead of time to make sure you are getting the value promised on the institution’s website. If you can’t travel before an application is due, then be sure to talk to current and former students, and read all you can before getting your heart set on one school that won’t turn out to be all that it seems.
Not only do international students studying in the U.S. tend to struggle with the same basic money mistakes and issues most college students have — where to get cheaper textbooks, how not to spend too much on going out, how to get the most bang for your buck when choosing housing, and so on — they also have these larger issues to contend with as they deal with exchange rates and a more challenging way of accessing funds. So reading up on keys to budgeting while traveling abroad will NOT hurt.
Luckily, there are ways to avoid mistakes with money for international students; the key is educating yourself before you pursue your international education. By working through these nitty gritty details ahead of time, your future self — the one gaining an excellent education abroad — will thank you!