Wednesday, July 13, 2011

Checklist for financing foreign education

From college applications to visas, studying abroad is an expensive affair. Depending on the location — US, UK, Singapore, Australia — the fee and rules change. Fee apart, there are multiple expenses one has to incur.

Application Process

As the first step towards your dream university abroad, you must take the required tests such as GRE (Graduate Record Examination) and TOEFL (Test of English as a Foreign Language). The fee includes a one-time expense of about $350, or, Rs. 16,000. After the scores, one can either approach an education counselor or shortlist the universities on their own. The counselor would cost Rs. 15,000-25,000, depending on the help required.

In some countries, the US and Singapore, for example, universities charge an application fee. Those in the UK and Australia do not usually charge any such fee. The cost in case of the former two is $50-150 (Rs. 2,200-6,600). The more the number of universities one applies to, the higher the cost. According to education consultant Karan Gupta, while there are many options in the US, they are restricted to the top two-three in Singapore. Total cost comes to about Rs. 33,200-47,600-plus depending on the number of universities applied to.

Fee

The cost of undergraduate (bachelor) courses is much higher than the graduate ones (masters). Education consultants peg the ballpark annual figure for an undergraduate course at Rs. 20 lakh (Rs. 2 million). Depending on the country, there could be a variance of 10-30 per cent. For graduate programmes, US universities charge the highest for a two-year course (starting at Rs. 25 lakh for the entire period), followed by UK (Rs. 16-18 lakh) and Singapore/Australia (Rs. 12-14 lakh) for one-year courses.

Those paying the entire fee in one go may be incentivised for one-year programmes. For instance, in UK, some universities offer rebates of 5-10 per cent if the entire fee is paid within a stipulated period after enrolment. Total cost is about Rs. 50-80 lakh plus for undergraduate courses and Rs. 50 lakh for postgraduate ones.
It needs to be noted that the fees in above countries would vary with exchange rate of Indian Rupee with the destination country's currency.

Visa

For visa applications, you may have to shell out Rs. 6,580 for the US and Rs 19,150 for the UK. Here, a common ground for rejection is the student’s failure to show adequate proof of his/her parents’ ability to pay for the course. Different countries follow different rules. For instance, for a US interview and Singaporean and Australian visas, you can show the entire amount of your course fee spread over liquid assets like fixed deposits, shares, bonds, mutual funds, account balance, etc. Though most people carry property papers along, these are considered only for establishing your bond with your home country and, hence, an intent of returning.

The UK, one the other hand, requires you to maintain an account balance (preferably the student’s own account) equivalent to the entire course fee for at least a month prior to your visa application. In case you are taking an education loan, the sanction letter from your bank can also be presented. According to Prashant Bhonsale, Country Head, Credila, HDFC’s education loan unit, “A loan sanction letter from an authentic financial institution works significantly in the student’s favour as the necessary due diligence has been done by a third party. Besides, visa officers understand that most applicants show temporary liquidity in their accounts."

Source: Business Standard, July 13, 2011
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