Budgeting and Balancing

Budgeting is genuinely one of the most important and yet impossible parts of studying abroad: it’s easy to convince yourself that you’re going to hold yourself completely accountable, spend only within your budget, and not fall for the phrase “you’re only in your 20s abroad once”. However, speaking from personal experience abroad, this is no easy task. 

I’ve never really learned how to budget before: I think I understand the idea behind it, I work three jobs at school, and I attempt to do it all of the time, but most of the key principles of budgeting still evade me. Therefore, I’ve tried to compile all of the knowledge and insight I’ve gained over the past few months of truly budgeting. I’m not working, I have a set amount of money and a set time frame, and it’s completely up to me how I allocate funds. 

Even though it’s not exactly kosher to talk about finances, it’s important for you readers to understand where I’m coming from with this (with actual numbers). I worked this summer full time (and part time last semester) and began study abroad with around $4,000 in my bank account and €1000 in cash. Not much and not nearly as much as my friends, but balling on a budget is how it goes in your 20s. I decided to allocate around $100/week to food and then I kind of skirted around creating any other tangible goals. I figured that it would all fall into place once I understood more about how much everything costs (right?). That was not the case: I quickly got overwhelmed with my new environment and new world I was living in, and completely forgot that I probably shouldn’t eat lunch out everyday, even if my friends are doing it. 

This entire time I’ve been budgeting using my notes app: I have a little “Budgeting in Germany” note pinned at the top and whenever I spend, I put it into the app. This has been extremely helpful because it’s good to reflect at the end of the week on how much I’ve spent and it makes me really ponder my money-spending choices. I have recently been color coding it too: my sections are food, travel, gifts, unneeded, house-related, and parties. This REALLY helps you realize how much you’re spending outside of the necessary categories (except wouldn’t yarn for knitting count as a necessity?). 

My first tip is to plan and pay for travel ahead of time. I know it’s really difficult because IES Abroad doesn’t give you your schedule until you arrive, but the first week you must start buying tickets because they get expensive fast. I lost a significant amount of my money ($800) because I waited until two weeks before my trip to Croatia to buy my flight. Don’t be like me; be smart and buy plane travel ASAP. 

My second tip (and maybe I’m just dumb to not have anticipated this earlier): choose euros or dollars to measure how much you’re spending. Don’t try and measure in both, your brain and your bank account will not like you. If you keep the notes app in your phone, just convert it beforehand or use your banking app or mostly pay in cash. 

I’d like to add a quick, but important note here: American prices (or at least Nashville prices) are so much higher than European prices. I know this is a large blanket statement to make about an entire continent, but at least in Freiburg, prices are genuinely flabbergasting compared to Nashville. Groceries that would be putting me in the $60-80 range in America cost around $20-30 here. There have been weeks of minimal outside spending where my food budget was under $80 for the entire week. When I was trying to research beforehand, I figured that it would be a little bit less, but I didn’t appreciate the magnitude fully. Factoring this into budgeting will help you allocate funds wisely. 

My third tip: set yourself an allowance for each week. It is so unlikely that you’re not going to want to buy anything other than household necessities and groceries for a week, especially when you’re studying abroad. That’s an unrealistic expectation to set for yourself, and therefore it’s so easy to immediately break. I began by telling myself that I was going to stick to a strict budget and that venturing outside of this would mean instant doom and financial insecurity for the rest of my life. Thankfully, when I did end up spending money on unnecessary things, the world didn’t explode. However, now further along in the process when money is getting tighter, I wish that instead of restricting myself so much that I never held myself accountable, I would’ve instead given myself an allowance of around, say, $30/week to spend on things I wanted. 

If you’re like me, you’ve never really bought consistent weekly groceries before or ever had to handle buying things like trash bags or olive oil or clips or salt. I’ve been extremely fortunate in my life to always have food on the table and then to be on a meal plan in college. Therefore, studying abroad was my first time ever providing for myself for groceries and household supplies and travel fares and everything else that comes with being an adult. I don’t think that I was prepared for the enormity of this task. There are so many small expenses that accumulate that I had never recognized or appreciated before, and not factoring those in ahead of time was a large mistake on my part. The best thing to do is to be prepared: using the tips from this and many other actual research-based articles on budgeting, compile a list of goals and expectations for your finances abroad. Nobody is perfect, but anticipating the expenditures ahead of time will save you so much stress when you’re abroad.