Expenses Covered in Education Loan for Abroad Studies

Studying abroad offers incredible opportunities for personal growth and knowledge expansion, but the associated expenses can be daunting. Education loans come to the rescue by covering a wide range of costs, including tuition fees, living expenses, travel expenses, and even insurance premiums. Understanding what expenses covered in education loan is crucial, especially as the cost of education abroad continues to rise. It's essential to consider inflation, currency fluctuations, and tax implications when making financial decisions. Taking an education loan not only safeguards against rising expenses but also offers tax benefits, ensuring long-term cost savings. Explore our comprehensive blog to learn more about the expenses covered in education loan for studying abroad.

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Expenses Covered in Abroad Education Loan

An abroad education loan is designed to provide financial assistance and alleviate the burden of studying abroad. From tuition fees and living expenses to study materials, travel costs, insurance coverage, and other miscellaneous expenses, education loans cater to a wide range of financial needs. Here are the top expenses covered in education loan that lenders usually cover in their education loans (expenses may differ from one lender to another):-

• Tuition Fees:

One of the primary expenses covered in education loan is the tuition fees. Whether you are pursuing an undergraduate, postgraduate, or doctoral degree, the loan amount can be used to pay for your course fees at the institution of your choice. The loan covers tuition fees for the entire duration of the program, ensuring that you can focus on your studies without worrying about financial constraints. So, it is covered by all the lenders irrespective of the fact that they are public sector banks, private banks, NBFCs, or international lenders. 

• Living Expenses:

Living expenses, including accommodation, meals, transportation, and other day-to-day costs, are also covered under an education loan. A student loan for living expenses ensures that you have sufficient funds to support yourself during your stay abroad. 

The loan amount considers factors such as the location, duration of the course, and the standard cost of living in the country of study. Living expenses can be a very broad category including expenses related to food, rent, daily expenses, etc. There is no uniformity in the way expenses are covered in the loans. 

• Study-Related Expenses:

Since studying abroad is not restricted to mere college education, the cost of study shouldn’t be conflated with the tuition fee. Expenses covered in education loan include additional expenses as well - such as undergoing projects, research, field visits, internships, etc. Education loans often cover the cost of study materials, including textbooks, reference books, stationery, and other educational supplies required for your academic pursuits. 

• Travel-Related Expenses:

Travel cost is usually in Lakhs, so many banks provide the option of including travel-related costs in the overall loan amount. However, it should be noted that banks do not usually provide the cost of travel as a default part of the loan. It can be included at the request of the borrower. For those who may not be able to afford the travel cost, it is advised to incorporate the travel cost into the loan.

• Travel and Health Insurance:

An abroad education loan often includes provisions for comprehensive health and travel insurance coverage. This helps safeguard your well-being and provides financial support in case of medical emergencies or unforeseen circumstances while you are studying overseas. 

• Miscellaneous Expenses:

There may be additional miscellaneous expenses that can be covered under an education loan. These may include visa fees, resident permit charges, student union fees, library fees, laboratory fees, and other necessary expenses directly related to your education.

Not Included: Expenses in Education Loan for Abroad Studies

There are several expenses that are not included in education loan providers lists such as pre-admission expenses. Below is a list of some of the expenses that are not included in an education loan are as follows:

• Study visa: An education loan does include expenses included in the study visa process. 
• Entrance exams cost: Education abroad loans do not cover examination fees of entrance exams such as IELTS, GRE, and TOEFL to name a few.
• College admission application fees: Education loans do not cover application fees of colleges and universities at the admission stage.

It is advisable to prepare a list of expenses covered in education loans throughout your education journey to avoid any future hassle.

Know Study Abroad Exam Fee Related Expenses:

• IELTS fees
• TOEFL fees
• GRE fees

Factors to Consider for Calculating Expenses in Education for Abroad Studies 

When planning to study abroad, it's important to consider various factors to accurately calculate your expenses. Here are some key points to keep in mind while calculating your expenses covered in education loan - 

• Accommodation Costs:

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  Research the cost of accommodation in your chosen country.
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  Check if shared accommodation is an option to reduce living expenses.

• Inflation During Your Course Period:

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  Analyse inflation over the duration of your course.
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  Sanction a higher amount in your education loan to cover potential increases in the cost of living.

• Transportation Costs:

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  Investigate transportation options and costs in the country where you will study.
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  Some places, like the US and Australia, have affordable fuel prices and low-cost used car markets.
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  In countries like Ireland, students can get discounts on public transport.

• Part-Time Job Opportunities:

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  Explore part-time job opportunities in the city where your university is located.
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  Many countries offer attractive part-time job options with fixed minimum wages, which can help cover a significant portion of your expenses.

These factors should be considered when calculating your expenses covered in education loan to ensure a comprehensive financial plan for your studies abroad.

All the factors mentioned above will help you in assessing the loan amount required to finance your education abroad. When taking na education loan understand your requirement before and then decide you amount you require for your education abroad. Hence, calculate your entire study abroad expenses and then analyse the actual cost of your study abroad journey. 

Understanding and analysing these factors alone can be overwhelming. Hence, in your best interest take help from experts working in this space so that you can be assured that your loan will cover the maximum of the expenses. We at GyanDhan understand that the whole abroad education loan process can be overwhelming at times. Therefore, we are here to help you. All you need to do is check your education loan eligibility at GyanDhan and leave the rest to us. Our education loan experts will guide you at each and every step of your education loan journey.

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