Study Abroad on a Budget: Financial Hacks for Indian Students

You have secured admission to a foreign university. Congratulations. 

Now you have to plan for life abroad for a few years. Studying abroad requires a lot of investment. Tuition fees, living expenses, books, travel, health insurance – the cost of studying abroad tends to add up. 

Managing finances can be quite challenging, especially if you are from a middle-class family and are going abroad with a scholarship or an education loan. But it can be done without breaking the bank. 

A few common-sense rules, the right resources, and some effort can make your small budget go a long way. 

In this guide, we’ll share tried-and-tested study abroad financial hacks to help you manage your study abroad budget efficiently. We will show you how it is entirely possible to experience an affordable overseas education without compromising on quality. Without further ado, let’s get started. 

Why budgeting is crucial for Indian students abroad

If you are going abroad for higher studies it is likely you are in your early to mid 20s. You have perhaps lived outside your home, in another Indian city for study or work. But studying abroad means stepping into a completely new financial environment. A new currency with a higher cost of living, and unfamiliar spending patterns. Without a clear plan, it’s easy to overspend and incur vast debts. 

Here are the key reasons why budgeting for study abroad is so important: 

Keeps You Financially Grounded

A well-thought-out budget helps you track where your money is going. Unlike when you were back in India, you cannot avail a few thousand loan from a friend to tide you over the last few days of the month. The bank that gave you the education loan will deposit a fixed amount into your account, and you have to ensure you don’t spend more than what you can afford. 

Reduces Financial Stress

Being abroad can be quite stressful. It takes effort to cope with attending classes at -5°C. It takes effort to cope with the enormous academic rigor. You need to conserve your mental stamina, and budgeting helps you achieve the same. A solid budget lets you stay in control. 

Avoid Unnecessary Debt

Through budget you learn to avoid debt. Banks in the USA readily lend to international students via credit cards. It is tempting and easy to make a minimum payment on your card and live beyond your means. But the rolling over debt only makes it go up and takes away an enormous amount of funds through interest. 

Enables Better Planning

Do you want a short trip to Mexico during summer break? Perhaps a new MacBook would help you compile code faster. Budgeting gives you the power to plan for big-ticket expenses without any excess strain. 

Builds Financial Discipline

What you learn through strict budgeting during your years abroad as a student will help you throughout your life. Learning how to manage your money while studying abroad sets the foundation for the years ahead. 

Researching affordable study destinations and programs

You can study abroad on a budget. It might sound surprising, but be assured, it is completely possible. Here are a few affordable overseas education destinations. 

Germany

German public universities offer free education to both domestic and international students, including those from India. You have to pay about €350 every semester for registration, but apart from that, it is completely free. Private universities, of course, charge tuition fees. However, at €10,000 and €20,000 for a masters, that is far less than what you pay in the USA or UK. 

Notable Universities:

• Technical University of Munich
• Ludwig Maximilian University of Munich
• Heidelberg University

Norway

Till 2022, Norway used to offer free education to all students, including international ones. Recently, they have started to charge a fee for international students. However, tuition fees are much lower than in other popular study destinations like the UK, the USA, or Canada.

Notable Universities:

• University of Oslo
• Norwegian University of Science and Technology (NTNU)
• University of Bergen
• Nord University

Spain

Spain is a popular choice for students looking for affordable tuition. Master’s programs typically cost between €1,000 and €3,500 per year at public universities. Private universities are more expensive and cost about €10,000 annually. 

Notable Universities:

• University of Barcelona
• Complutense University of Madrid
• Universidad Autónoma de Madrid
• Pompeu Fabra University

France

France offers high-quality education with very low tuition fees at public universities. Universities charge just €3,900 per year for master’s programs. France is renowned for programs in fashion and design, business, film studies, and literature.

Notable Universities:

• Nantes University
• Sorbonne University
• University of Paris-Saclay

Malaysia

Closer home, Malaysia is an excellent yet affordable study abroad destination. The average cost of a graduate degree in Malaysia is around $6,000 annually. Many university courses are taught in English.

Notable Universities:

• University of Malaya
• Universiti Putra Malaysia
• Universiti Kebangsaan Malaysia

Below is a table highlighting these affordable study destinations. We have included average study abroad costs and the cost of living.

Affordable Study Abroad Destinations: Tuition and Living Costs Comparison

Securing financial aid: Scholarships, grants, and loans

Studying abroad is a dream for many, but the cost of studying abroad can seem daunting. 

A vital component of the study abroad budget is seeking out funding. But there is no need to worry at all. Numerous options exist, ranging from scholarships and grants to education loans that can help you effortlessly achieve your ambition. 

Scholarships and Grants

Scholarships are financial awards given to students to help cover the cost of their education. Scholarships are offered by foreign governments, Indian government bodies, universities, and private organizations. The two terms – scholarships and grants – are used interchangeably. However, usually grants are need-based while scholarships are merit-based. 

Below is a list of scholarships available for Indian students categorized by destination country.

Scholarships for Indian Students Studying Abroad

Besides the above, top institutions have substantial funding pools for needy students. Some, like MIT and Harvard, state that deserving students will not be turned away for lack of funds.

Significant grant opportunities exist in universities in the USA, Canada, and the UK.

Education Loans

If you are unable to secure enough scholarships or grants, an education loan becomes essential. It is a type of loan provided by banks and NBFCs to help students finance their study abroad costs. Most public and private sector banks offer education loans, including:

• State Bank of India
• Bank of Baroda
• ICICI Bank
• HDFC Credila

GradRight gives you single window access to 15+ lenders. All that you need to do is sign up and complete your profile. Our partner banks and NBFCs will revert back with their most affordable offer. All you need to do is compare the terms and choose the one that is best. A simple and zero-hassle way to finance your education abroad. 

Here are the key aspects of education loans for study abroad in India: 

Eligibility Criteria

• Indian citizenship aged between 18 and 35 
• Admission to a recognized foreign university
• A strong academic background 
• Co-applicant (parent/guardian) with stable income

Documents Required

• Admission letter, academic records, ID & address proof
• Co-applicants income proof (salary slips, ITR, bank statements)
• Collateral documents 

Interest Rates

Education loan interest rates in India vary based on the bank, loan amount, security, and the type of course. Generally, rates hover from around 8% to 14% per annum.

Here’s a summary of the prevailing education loan interest rates:

Public banks usually charge slightly lower rates than private sector banks.

Collateral Requirements

Generally, secured education loans require property as collateral, such as a house, property, or fixed deposit certificates. However, collateral-free loans are also availabl,e albeit at a slightly higher interest rate. 

Pre-departure savings: Cutting costs before you go

Small decisions made before departure can add up to big savings in your overall study abroad budget. You can start saving money long before you set foot abroad. Here’s how to cut costs from the get-go. 

Book Flights Early

Airfare is a major expense. The earlier you book, the cheaper the airfare. For example, if you book Delhi – New York, two weeks before departure, it costs ₹54,900. The price drops to ₹34,000 if you book two months before. That saves almost ₹21,000 by booking slightly early. 

Don’t Overpack

Excess baggage costs a lot. Most airline tickets include a free checked baggage allowance of ~30 kilos for economy class passengers. Stick to essentials and check your airline’s baggage allowance carefully.

Buy Second-Hand or Borrow

Do you need a new laptop? What about a warm coat and winter clothes? A new suitcase? Before you splurge, check if you can borrow from friends or family. Perhaps you can buy a few items secondhand online and save.

Get a Forex Card

Instead of carrying large sums in cash or using Indian debit cards, which carry a costly conversion fee, it is better to buy a forex card. Cards such as Au Bank Ixigo Credit Card carry zero conversion charges, offer lounge access, and 10% discount on airfare. 

These simple study abroad budgeting tips might seem small, but together they can cut your expenses significantly. 

Budget-friendly accommodation and living options abroad

Finding the right place to stay is one of the biggest decisions you’ll make while studying abroad. Here are a few options to keep your study abroad budget in check. 

Stay At University Dorms

Dormitories are secure, close to campus, and the fee includes utilities such as wi-fi. You also save on transport and have access to a medical center. However, it is not always the cheapest option. 

Shared Accommodation Saves Big

Living with roommates is likely the best option to stay within a study abroad budget. Sharing your apartment with at least one and preferably more students makes a major difference. In countries like Germany, Spain, and even smaller cities in the US and UK, shared housing can reduce your rent to as low as $400 per month.

Location Matters

Rent drops the further you are away from the city center. If there is good connectivity by bus or metro, you can easily live 20-30 minutes away. Your rent will drop significantly due to the distance. For comparison, that is like staying at Noida and studying at Jawaharlal Nehru University, New Delhi – something many students do. 

Money-saving strategies during your stay

Once you have arrived at your destination, the journey truly begins. Daily choices can either stretch your funds or slowly eat them up. Here are a few money-saving tips while studying abroad:

Cook More, Dine Out Less

It costs a lot to eat out. In the recent past, the West has seen enormous inflation. Cooking simple meals at home can cut your eating expenses in half. 

Use Student Transport Passes

Public transport is your best friend abroad. Most cities offer discounted student passes for buses, trains, and trams. For nearby visits, you can consider buying or borrowing a cycle. 

Shop Smart with Student Discounts

Your student ID does wonders. From museum tickets and gym memberships to tech purchases, it opens doors with large discounts. Always ask if a student rate is available. 

Do Your Own Chores

Learn to do your laundry, chores, and perhaps even minor repairs. Doing these yourself saves money and helps you become self-sufficient. 

Buy Second-Hand

If you need a bed, study table, or other furniture, try and buy from thriving second-hand markets in every major university town. Check Facebook groups and the marketplace for cheap deals. 

Living within a study abroad budget is not always about cutting back. It is also about spending smarter. With these hacks, you can enjoy your experience abroad without needless financial stress.

Leveraging financial tools and apps

Managing money abroad can feel overwhelming at first. However, there are plenty of tools to help you track your budget. 

Copilot Money

Copilot Money is a budgeting and personal financial management app. It offers myriad features like budgeting, transaction categorization, and rollover options.

Splittr

Splittr is an app designed to simplify and automate the process of splitting expenses with others. The app allows users to add expenses and then determine who owes whom and how much.

Everydollar

EveryDollar is a personal budgeting app. It is useful since it has a debt manager that helps users track their debts and see when they will be paid off. 

Zolve

Zolve is a cross-border fintech company that focuses on making international financial products accessible to students and immigrants from India. It offers services like US bank accounts and credit cards, even without a Social Security number or US credit history.

Frequently Asked Questions 

1. What are the top budgeting strategies for Indian students studying abroad?

Here are a few study abroad budgeting tips:

• Share accommodation to reduce rent
• Set a monthly budget and stick to it
• Avail student discounts where possible
• Track your expenses with financial apps 

2. What are some affordable accommodation options available for international students?

Shared apartments are usually considered the cheapest option. You can split rent and utilities with roommates. Even though it could be slightly more expensive, university dormitories are convenient and often subsidized.

3. Which apps or tools are most effective for managing study abroad expenses?

Apps such as Zolve, Splittr, and Copilot Money are excellent at helping students budget and track expenses. 

4. How should I prepare financially for unexpected costs abroad?

Preparing financially for unexpected costs abroad is crucial. You should maintain at least $500 to $1,000 saved in your bank account for emergencies. It is also imperative to know where the nearest clinic or hospital is, and whether your health insurance plan covers treatments there.