How to live abroad with student debt loans

How to live abroad with student debt loans Leave a comment


As a teenager in high school, I always dreamt of living abroad especially in a Spanish speaking country. I wanted to be able to practice the language I learned from the classroom. Speaking to real native Spanish locals was a goal I hoped to achieve in my lifetime. In addition, I wanted to have a competitive advantage in the workforce.  The urge to fulfill my dream became stronger in college. I considered some University programs such as Study abroad or the Fulbright scholarship. The study abroad programs in my school were too expensive for me or my humble middle-class family of 6. Although the study abroad programs had some scholarship opportunities, they were just not enough to cover living expenses or school materials. Going through the Fulbright scholarship would have been the best option in college as all expenses are paid for, but I found out about it late in my college years. Besides these challenges, I had more obstacles which were financial constraints, college course compatibility, and student debt.

Obstacle: student debt

Student debt: Business Graduates
College Graduates

My student debt was the biggest impediment to achieving my dream.  I had an unsubsidized (not the best option) loan that accrued for $1 every day. It had reached nearly $10,000 by the time I graduated. The challenge was either to work one year and pay off my debt or live abroad and figure it out. I was a bit restless and I wanted to be fluent in Spanish sooner than later, so I moved to Spain right after graduation. How did I fund my move and manage my finances? The short story is that I worked during the summer before I left the U.S. You can find the detailed story here, with a worksheet and proven guides that helped me live abroad twice. So, how did I fund my expenses abroad and pay my debt? The next paragraphs include the methods in which I made my dream come true. 

According to Personal Finance News, “The total amount of U.S. student loan debt is a staggering $1.3 trillion dollars and Roughly a tenth of student debt borrowers are delinquent or defaulted on their student debts”

How I managed my student debt

Student debt: image 1

As a recent college graduate, the wrong way to start off your financial journey is to default on your student debt. Your goal is to always maintain a good credit record. There are two main options when it comes to getting a break from loan payments. One is Deferment and the other is Forbearance. A deferment allows you to pause your loan payments temporarily for an extended period of time. If your loan is subsidized, interest wouldn’t accrue during deferment.

Jobs opportunities such as working for the government or peace corps give you the option to defer your loans.

The other option, forbearance is quite similar to a deferment the only differences are that you are given a payment break for a limited amount of months. You also have to pay interest during forbearance regardless of the type of loan. Teddy from Nerd Wallet explains in details more about these payment breaks and how you can qualify for them. 

If you choose to pay, you can select the many payment plans, given to you by your federal or private loan providers that might be suitable for your situation.  For example, you can select a plan that calculates the minimum amount to pay based on your income.

What I chose to do

Because I had an unsubsidized loan, it was economically wise to pay it off monthly using the income payment plan.  I had saved about $5000 for expenses abroad and I used my savings to pay my monthly debt. I also taught English while I was abroad in Spain earning about $1200 per month. Spain isn’t the best country when it comes to wages. There are Native English teachers that earn $2000- $5000 per month in Asia and the Middle East. However, I had a bigger goal, which was to be fluent in another language so the Spanish wage was good enough for a short time.

Expenses Abroad

Spain for an American is an affordable country, even in the big cities. Basic necessities such as food, transportation, healthcare, and accommodation are cheap. Below is an estimated breakdown of my 9-month expense in Spain.

Student debt: Spain's expenses
                                                                                     Spreadsheet of my monthly expenses in Spain

After the first year in Spain, I ended up saving  €1,684.71  which is approximately $2004.72. I had a reasonable amount left over from my savings which I didn’t include in this calculation.


My experience in Spain was one of the best experiences in my life and if given an opportunity to do it again, I will in a heartbeat.  Although I could save a decent amount of money, one that allowed me to stay for an additional year, there are some financial decisions I wish I handled wiser.  Here are tips that would help you make financially smart decisions whether you are abroad or at home:

  • Seek out methods to get through college debt-free
  • Try to pay some or all(if possible) of your student debt while in college.
  • If you can avoid it, don’t opt for an unsubsidized loan. Instead get a subsidized loan, grant or scholarship.
  • Aim for well-funded study abroad scholarship programs like Fulbright. 
  • Student debt is part of our responsibility. No matter how bad your student loan gets, you don’t have to result in this situation. You will forever be on the run or your family would have to bear your burden. 
  • Create a budget and keep track of your monthly expenses.
  • Your flight mishap would have been less stressful if you just got that travelers insurance.
  • Finally, always find ways to improve your financial situation. I am already working on 4 out of the 8 tips given by the finance zone. 
Student debt: Business Graduates

For those of you, who are afraid of achieving your dreams for fear of your student debt, know that there are numerous options out there. You can make it happen with proper planning, wise financial decisions, and research.

This is a guest article by Kareemah, a Travel writer, and Blogger.

I studied finance at college. Although my current profession is not in the finance or accounting field, I still incorporate its practices into my life decisions. I spend my free time either reading, meeting new people or trying new cuisines. Feel free to connect with me on Instagram or check out my blog for travel tips and guides:

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