As I’ve just completed my time abroad, I wanted
to share a few personal finance tips that I have acquired through my
experience, and what I have discussed with fellow students traveling abroad. Rather than remind you that traveling and
living abroad can be costly, I am going to share with you tips to save money,
and have a more pleasant experience spending
in foreign countries.
The first thing you must consider is that it may
be difficult or impossible to open a bank account abroad. Yes, there are some instituions that have
partner banks around the world (I’m talking about you, Barclays), but for the
most part, you should be able to get by without opening a bank account. My recommendation is, prior to leaving the
USA, open a free checking account with Charles Schwab (specifically Charles Schwab High Yield Investor Checking,
found at http://bit.ly/1fYJ3OO). This account is completely and totally free
(no minimum balance, no minimum required to open), will charge NOTHING to spend
abroad (no foreign transaction fees), and will
reimburse ATM fees WORLDWIDE. This
was my favorite perk. I could use any
ATM in London, and I was reimbursed if they charged a fee. I saved A LOT more money than my friends by
having this perk. Also, the account will
give you a lifetime of free checks (even though I don’t think you’ll use them
ever). Seriously, it’s a great
deal. Full disclosure, they do a
credit-check prior to open (hard-pull), so having credit history may be
helpful. Also, their customer service
can be accessed worldwide, and I had zero issues at all during my time
abroad.
If you’re a bit worried on spending, and you
want to try to keep emergency funding in your bank account, I recommend opening
a credit card that charges no interest for a promotional period. I did this and
put most of my purchases on it, and with the additional perks, was able to get a
free plane ticket home (thank you, Delta Skymiles Gold American Express). Make
sure it offers zero foreign transaction fees – otherwise, you could end up
paying a lot more, like 3% per transaction more. It would be best to consider MasterCard or
Visa, as American Express is not accepted at all places you’ll be
spending. I used the CapitalOne
VentureOne Rewards Card. No foreign
transaction fees, no annual fee, and I was able to secure more cash-back on my
travel to save me more money. When I
opened the card, it offered no interest for 12 months, so if I did have a
balance, I wasn’t charged interest. This
gives you a little more freedom in financing your time abroad – but, please be
careful, and keep your parents notified of your spending if they are assisting
you financially abroad. If you have no credit
history, you might need a co-signer, and please remember that your credit will be
affected after opening/applying!
Prior to doing additional traveling,
you need to consider additional spending that migh arise due to your traveling.
For example, if you purchase a cheap Ryanair ticket, do you know how you are
getting to the airport? Ryanair usually
occupies airports outside of city limits, requiring a $10-15 shuttle ride per
direction. This can add up quickly, so please do your research ahead of time.
Consider my trip to Milan, Italy from London.
· RyanAir round-trip ticket:
$32
· Shuttle to London Stansted
Airport from Central London, and return: $22
· Shuttle from Milan Bergamo
Airport to Milan Central, and return, $30.
So, you
might have figured you got a REALLY cheap flight… but when you add in the
extras it will take to get to/from airports, it can add up quick. Just please consider this before making your
arrangements!
So, just
be conscious of how you’re going to be paying for additional fun while you’re
studying abroad. And always over-budget
when you’re preparing. Contact me if you’d
like more advice on credit cards, and banking services… I have a lot of
experience in both, and I’d be happy to share my advice!
