Thursday, 7 May 2015
A semester abroad offers an array of treasured experiences: New places, foods, people and often, languages.
But amid the excitement, it's easy to overlook some critical elements of financial preparation. James Hilton, associate director of Overseas Study for the University of Southern California (USC), helps helps students arrange semesters abroad. In an interview, he offered some tips on how students can keep their finances in order—while they're away and when they return.
See if your bank has a partner institution or branch in your destination country; it's easier to access your account and there will be fewer, if any fees for ATM withdrawals. The exception is if you're in a situation where you'll need to pay a landlord outright (most, though not all, programs have housing covered). Under that situation, it makes sense to open a bank account in the host country and use an EFTPOS card (similar to a debit card) accepted by landlords.
In some countries, such as Japan, debit and credit cards are only used for large purchases. Also keep in mind that many countries use chip credit cards instead of credit cards with a magnetic stripe, and unlike in the U.S., you need to input a PIN when using the credit card. Investigate your options.
Rather than shipping boxes full of stuff, or paying airlines' extra baggage fees, Hilton advises students to travel light. "Don't bring more than you can carry around the block alone."
Check to see if you still have to pay for your school accommodations while you're away. At USC, for example, students who take a semester abroad are released from their housing contract from the time they're gone, and can usually return to the same dorm room. If you're renting off campus and don't want to move out, see if you can get a trusted friend to sublet while you're gone.
If you anticipate financial transactions, such as stock sales, loans, child support payments or legal papers, be sure to designate someone—normally a parent—to have power of attorney for the time you're gone.
Change your address on your bills, subscriptions and regular mail to a permanent home so that your parents, relatives, or friends can keep an eye on incoming mail that can't wait until your return.
Hilton recommends student-specific travel agencies such as STA Travel or Student Universe to make arrangements. Online purchasing can be overwhelming and even dangerous for a novice traveler. He recalls a sophomore traveling to Spain who tried to buy her ticket online. "She came to our office asking how to make a wire transfer in British pounds to buy her airline ticket. It was some online scam." Fortunately, the university was able to direct her to a more reputable outlet before she parted with her cash.
Make a budget and stick to it. It may be tempting to take expensive weekend jaunts and dine at pricey restaurants because friends are doing it, but in the end, you'll end up spending more than you wanted, and you'll also miss out on the local flavor.
It's generally less expensive to buy your tickets for short hops to neighboring countries using local discount airlines such as Ryanair instead of shopping for those tickets from home. For lodging, "we recommend students really take advantage of youth hostels," Hilton said. "It's a really exciting way to travel. A lot of students have misconceptions of what a youth hostel is, but there are beautiful youth hostels. They're in castles and lighthouses. So we recommend they explore youth hostels, not only for the economical part of it, but also for the experiential part of it, for meeting backpackers from all around the world."
Finally, Hilton says to give yourself time to fall in love with your host country and get to know the people and culture. "We recommend everybody, no matter what their budget is, spend at least half of the weekends locally and really feel like a local rather than a tourist."
The content provided is for informational purposes only. Neither BBVA Compass, nor any of its affiliates, is providing legal, tax, or investment advice. You should consult your legal, tax, or financial advisor about your personal situation. Opinions expressed are those of the author(s) and do not necessarily represent the opinions of BBVA Compass or any of its affiliates.
Links to third party sites are provided for your convenience and do not constitute an endorsement. BBVA Compass does not provide, is not responsible for, and does not guarantee the products, services or overall content available at third party sites. These sites may not have the same privacy, security or accessibility standards.
Can technology enhance your wine country experience? We think so. Here's how.
Want to explore the Southwest? Here is a roadmap to seeing four states in one week, all on the cheap.