HSBC’s ‘The Value of Education Foundations for the future’ report reveals that USA is the destination parents are most likely to consider for their child’s international university education. Of the parents surveyed, 58% rated USA as one of their top three destinations from a list of 50 countries.
However, USA is also the most expensive destination, with the average annual tuition fees for international university students there being as high as $ 33,215 per year.
For parents in India, the top three countries where they are most likely to send their child to university are USA, Australia and the UK. When parents were quizzed for the top three reasons to best explain why they would choose an international university education, more than half (57%) said it was for the international work experience, 57% said that it would increase confidence while 53% said it for was for the exposure to new experiences, ideas and cultures.
The proportion of parents who would consider university abroad for their child is relatively high where almost half of those surveyed (47%) said that they would want to send their children to university abroad. The top three barriers however for sending the child to university abroad are higher costs to the parents (43%), higher costs for the child (29%) and because the child could get homesick (28%).
S. Ramakrishnan, Head of Retail Banking and Wealth Management, HSBC India said, “An international university education for their child is a highly desirable ambition for many parents. However, it comes at higher costs, with living expenses and air fares on top of tuition fees. Early planning and regular saving can help parents overcome these financial barriers and unlock the extra opportunities they wish for their child.”
So how can advisers help parents plan for their child’s international university education? Here are a few tips:
- Research the options - You can help parents consider all international options by reviewing university rankings and understanding which countries can offer the best balance between quality of education, cost of tuition and living, and job prospects.
- Consider all the costs - A university education abroad usually costs more than at home. In addition to higher tuition fees, there are living expenses and international travel costs to plan for.
- Start planning and saving early – Help them by creating financial plan aligned to the goals.
- Explore the financing options - The cost of tuition and living as a student abroad can be high. Educate parents about different financing options available to help them fund the education bill.
- Help them understand how to manage finances abroad – Help parents to understand how they can exchange, accumulate and transfer foreign currencies. Advise parents to open an international bank account to help them manage their child’s finances abroad.
Methodology: The study was conducted online in June 2016 and represents the views of 6,241 parents from 15 countries. The findings are based on a survey of parents who have at least one child aged 23 or younger currently (or soon to be). Over 350 parents (including 150 with a child at university or college) were surveyed in all countries.