Value of Higher Education
According to new figures released from Higher and higher, HSBC’s latest report in The Value of Education series, globalisation of higher education shows no sign of stalling. The study of over 8,000 parents across 15 countries and territories found that more than two-fifths (42 per cent) would consider sending their child to university abroad, compared to 35 per cent in 2016 – a seven percentage point (pp) increase.
Ambitious parents in Asia are boosting the trend: India (62% plus 15pp), Indonesia (61% plus 1pp), China (59% plus 15pp), Hong Kong (52% minus 2pp), Malaysia (51% plus 8pp), and Singapore (47% plus 4pp).
This echoes OECD data that highlights that Asian students account for 53% of all students studying abroad worldwide. According to HSBC’s partner, the Institute of International Education (IIE), China is the leading country of origin for international higher education students, sending an estimated 801,000 abroad, with India (1,82,000) and Malaysia (64,000) also exporting significant numbers.
- Parents in Asia appear to be much more focused on the competitive advantage an overseas university can offer their child:
- Parents in Malaysia are most likely to consider the quality of teaching on offer (67% vs only 30% in the UK, 27% in Australia and 19% in the USA)
- Parents in Indonesia and Malaysia are most likely to consider the specific courses available for their child (both 61% vs 23% in Australia and the UK and 21% in the US)
- Parents in Indonesia are also most likely to consider the ability of the university to open up job opportunities for their child (58% vs. 41% in the USA, 32% in Australia and 28% in the UK)
Despite a common idea that international students would stay in their host country after graduating, parents’ top expectation (35%) is that their child would search for full-time employment at home. Only 9% would like their child to search for full-time employment in the country where they have completed their university education.
Cost of education
The majority of parents (73%) considering university abroad for their child expect to make a significant financial contribution, and estimate the overall average cost of an undergraduate and postgraduate degree abroad to be USD 157,782 (USD 71,580 for UG and USD 86,202 for PG). Many parents (45%) would go further and consider buying a property in the country where their child is studying.
More generally, spending on education is particularly resilient in Asian countries. For 44% of parents in India and 42% in China, paying for their child’s education is their most important financial commitment.
Trista Sun, HSBC’s Global Head of International and Cross Border, said: “HSBC’s report shows that the number of parents, especially in Asia and UAE, who are ready to invest in an overseas university education for their child’s skills and employability continues to grow. With an undergraduate’s total cost expected to be around USD 72,000 on average, the investment is financially significant for parents. Additionally, 45% would consider buying a property in their child’s country of study. Parents need to plan ahead and look at all the implications of funding international education.
“With 39% of parents having specific universities abroad in mind for their child, their investment goes beyond financial. They spend a lot of time and energy to help their child build their academic profile and credentials for them to meet the entry requirements at prestigious universities.”
With the power of its global network, many banks support customers with their international financial needs in four of the top five destinations for higher education abroad. Whether it is setting up a bank account before they arrive in a new country, or welcoming them to settle in, banks offer a package of products and solutions to ease their journey abroad. In addition, banks are partnering with key players in the education ecosystem – education agencies, secondary schools, language schools, universities, visa services, students associations – to provide support to families beyond banking services.
Top Study abroad destinations
Parents see the main benefits of a university education abroad as being to help their child gain international work experience (49%), develop foreign language skills (49%) and to be exposed to new experiences, ideas and cultures (48%).
Overall, the USA is the most considered international destination by parents for their child’s university education (47%), ahead of Australia, the UK, Canada, Germany and France.
- Parents in Taiwan and China are most likely to consider the USA (70% and 61% respectively)
- Parents in Malaysia and Indonesia lean more towards Australia (67% and 65%)
Data from the Institute of International Education shows that alongside traditional destinations for international students such as the USA, the UK or Australia, destinations in Asia are becoming more popular.
Practical steps for parents
- Consider the benefits of university education abroad: It can help your children to be independent and enhance their job prospects.
- Be realistic about the costs: Make sure to plan for all the implications including higher tuition fees, international travel, accommodation, day-to-day expenditure and exchange rate fluctuations.
- Start planning early: Early planning and saving for education can help your children fulfill their potential and limit the strain on family finances. Seeking professional advice can help you plan and make better-informed choices.
- If buying property abroad: Choose a mortgage plan that is most suitable for your needs.
- Consider the interest rate, repayment period, setting-up fees, early repayment flexibility and cancellation fees. Be aware of the tax and foreign exchange implications.
Practical steps for students
- Learn about your new country, its culture and customs before you go.
- Sign up to classes or training your university may offer to help you navigate your new surroundings.
- Speak to recent graduates who studied aboard, their first-hand experience can help you adapt quickly.
- Explore your new country and be open to making new friends.
- Get involved in campus activities beyond academics, taking advantage of the many clubs, sports, interest groups and social events to mix with the diverse student population.
More than two-fifths (42%) would consider sending their child to university abroad, compared to 35% in 2016 – a seven percentage point increase
Indian Parents’ are spending $ 18,909 on their child’s education
94% Indian parents would consider postgraduate education for their child
According to Indian parents, the top three destinations for university abroad are USA, Australia, UK
82% Indian parents would consider an online university degree..
Writer, Donna Walter is living in United States. Donna Walter is part of our authors community.