Studying abroad at one of Ryerson’s exchange partner universities is a great opportunity to gain international experience, learn a new language, meet new friends, and immerse yourself in a different culture. One of the most important aspects of going abroad is to start planning and saving money well before your journey begins. Not sure where to begin? This post will get you started!
Doug Furchner, Program Coordinator of Ryerson’s free financial literacy course, RU Debt Free, explains that all the lessons covered in the course syllabus are applicable well beyond the borders of Canada. The course covers the basics: budgeting, banking, bank accounts and saving, credit basics, paying for school, and life after school. In preparing to study abroad, using simple financial planning tools can make a huge difference. Doug recommends that if possible, take this FREE course before going on exchange.
Doug Furchner (right) and the RU Debt Free Team
In an interview with Doug, he outlined the fundamentals for proper financial planning to avoid stress before, during and after your exchange experience. His key tips and tricks are detailed below.
When to start planning?
According to Doug, you should start planning the moment you are accepted into the program. You need to know how much money you have, how much money you will need, and what your plan is for getting there. You need to research the cost of living in the particular place you are going, and create a basic budget in Canadian dollars.
Doug explains that proper budgeting is the key to everything! There are a variety of basic templates for college and university students in Microsoft Excel.
Step 1: Create a budget based on where you are now. Incorporate a line with a monthly savings schedule to bridge the difference between how much you currently have and what you will need to go on exchange.
Step 2: Create a monthly budget to follow while you are abroad. Estimate your fixed expenses such as rent, tuition and transportation. Account for fluctuating costs as well, such as food, grooming, and entertainment. At this stage, it’s helpful to create two budgets side by side: one in Canadian dollars and one in the local currency of where you are going. Be sure to use a currency converter!
Step 3: While abroad, be sure to manage your budget on a monthly basis. Reconcile your bank account with your budget at the beginning of the month, reevaluate your spending and expenses, and consider what needs to be amended going forward.
Tips for saving while abroad:
Doug warns not to use your Canadian credit card, unless it’s an emergency. Cash and debit only! Avoiding the use of credit will help you resist the temptation to go over budget. Instead, load a prepaid credit card and lock it up upon arrival. Only use it in the event of an emergency.
Tips for Banking Abroad:
Doug cautions all exchange students to be aware of banking fees on both ends of every transaction. The bank here and the bank there will make money off of you every time you use your Canadian debit card.
As a smart alternative, he recommends opening a local bank account upon arrival. You can transfer a lump sum from your Canadian bank account, or you can bring a bank draft with you and deposit it right away. Then, you budget, budget, budget!
Life After Exchange
Doug recommends carrying your now developed good habits into your everyday life. Keep budgeting, keep saving, and if you can, start putting 10% of your total income into a savings account or an RRSP.
For more information on exchange opportunities at Ryerson, please visit: http://www.ryerson.ca/ri/