One of the biggest challenges any student faces when they go off to college is creating and sticking to a budget. Now, to that add currency fluctuations, unknown living costs, unforeseen circumstances with little support in the host country, and international travel, and it becomes an even more complicated issue.
We work with thousands of international students all trying to navigate their way through the complex web of financing their degree. Sixty-three percent of international students fund the majority of their education out of their own pocket, according to the latest Open Doors Report. In some cases, they are just scraping by. So the question becomes, how can you help your international students when it comes to budgeting?
We’ve identified important ways that you, in international higher ed, can help with the process:
One of the most important decisions an international student will make is what school they enroll in. After all, this will set the course of their long-term career perspectives, and thus earning potential. In the short-term, however, they may not realize these financial gains, and instead they may break the bank, or go into debt to finance their degree. So, how can you help minimize this?
Set expectations. These financial expectations should be told to students before they enroll in their school. Will they need a car to get around? Does your city have a high cost of living? Do you have an insurance plan that costs upwards of $1,000? How much is your international student fee? These are just some of the questions that students should know the answer to prior to their enrollment.
By setting clearly defined expectations of how much things costs, students and their parents will know full-well how much they can expect to pay for their education, and budget appropriately. While this may seem straight forward, it directly improves the school’s retention rate. When students enroll in your school, they are also committing to covering these expenses as well. When financial surprises come up, this may mean that your phone is ringing off the hook, and students are knocking at your door, wondering how they are going to cover it all.
Add Transparency To The Mix
Now, add transparency to the mix, which is extremely important – and goes hand in hand with setting expectations. Many schools publish an estimated budget for their incoming students, which if accurate can be very helpful. But, what is accurate? Where do these numbers come from? Where does the I-20 proof of funds figure come from?
One school decided to poll their international students to see how much their education cost. They thought that this poll would help provide a more accurate, and more transparent, amount that they could then provide to incoming and prospective students. When they gathered up the data, they found that the numbers were all over the place. Instead of becoming clearer, it was just more confusing!
That’s no surprise, though. Every international student lives differently, some living on Ramen noodles and pizza, and others enjoying the fine-dining eatery down the street. Students must be advised of this, as the cost of living will really depend on the student.
So if that’s the case, what assumptions are being made on your budget? Do you assume that the student will be living on campus, and getting around town by bus? Do you assume that students will go out once a week? Communicating what these numbers represent will help students better assess whether they are on the low-end or high-end of the budget.
Furthermore, I prefer to express estimated budget costs as a range instead of a flat figure. By providing a range, students have more variability and can better assess their life of luxury (or lack thereof). While the I-20 number is important, many schools I’ve spoken with have said that this is not accurate and representative, but it’s important for schools who are eager to get those international students who are looking for an affordable school. But if you set expectations, and are transparent, you will find that the right type of student is enrolling in your school.
Once you’ve communicated this information to your students, the next step is to let them know what resources are available for them to get the best bang for their buck.
Orientation is a great time to reach out to your students and communicate what resources are available to them. While orientation is cram packed with just about everything, one of the most important things to communicate is budgeting for school, and how to make their dollar go farther once they arrive. Be sure to have a centralized place where students can access this, preferably online, so that they can always go back in case they forget (which is bound to happen).
I recommend getting your international student club on campus, or even current students, to help with a cheat sheet of tips and tricks they’ve learned. Have them come up with a list of ways they can make their dollar go farther, including:
- Shopping – Do you have a store that has good quality products, but is cheap?
- Buying Books – Is there a physical store or an online portal where you can get a good deal?
- Health Care – Where should students go for health care so they don’t break the bank?
- Working on Campus – Is working on campus available to your international students?
- Transportation – What’s the most affordable and most efficient way to get around town?
- Eating – What are a few easy to make, affordable recipes students can make at home?
Empower With Budgeting Tools
The next step is to give your students information on what they need to know when it comes to budgeting. I recommend discussing this at orientation, and providing them with resources that will help them make financially wise decisions. In addition to information on tips and tricks to find great deals and lower their costs, I would suggest providing them with an actual budget they can use.
1. Sample Budget
Check out this sample budget that students can use to help keep track of their expenses. This helps students prioritize their finances beginning with the important considerations, and then add further detail to make their budget even more concrete and personalized.
2. Discuss the Do’s and Don’ts – Or Use A Video
You can also go through the do’s and don’ts with students when it comes to budgeting. Don’t have time? We also have a budgeting video that outlines the steps to develop their own budget so that it works for them, in a quick and painless way.
3. Provide a check list on pre-arrive and post-arrival
Expenses come in many forms, and giving all the considerations at one time can be overwhelming. While it’s important to have it available to your students, you may find that breaking down the costs both pre-arrival and post-arrival can make this more digestible, and less overwhelming for your students.
4. Check in with your students
Once orientation is over and your international students disburse, you may consider checking in with them from time to time. Depending on your international student population, this may or may not be doable. Use social media, email and other technology to communicate your open door policy in case any financial hardship situations come up.
Share with us what budgeting tips you give your students and how you get the word out there!