Carrying student loan debt can feel very limiting. You might dream about traveling the world, but your monthly student loan payment keeps you chained to the job that allows you to avoid defaulting.
But what if there was a way to have your cake and eat it, too? Teaching English abroad offers college graduates the opportunity to travel, minimize their expenses, and still pay their student loans.
Here is what you need to know about teaching English abroad.
Not all teaching positions are created equal
While there is demand for native speaking English teachers all over the world, the amount of money you will earn depends on where in the world you go.
According to the International TEFL Academy, a teacher training program, American English teachers in Europe and Latin American can generally expect to earn enough to live comfortably, with enough left over for travel and other interests.
However, it’s less likely for teachers in these countries to be able to save extensively; graduates with large student loan balances may not want to teach there.
Expat English teachers in Asia can typically save between 30 and 50 percent of their monthly salaries after expenses and basic travel/fun money. Depending on where you teach, that savings can range from $200-$300 per month in Thailand to $1,000 per month in South Korea.
If you are interested in teaching in the Middle East, that is where you will find the highest teaching salaries in the world, ranging from $1,500 to $4,000 per month, with benefits that include free housing, paid vacation, and health insurance.
Also, the types of teaching positions vary from program to program. Some English-speaking teachers who have teaching experience and/or expertise in another subject may land a job teaching at an international school, with students whose first language is English. In most cases, however, you will be teaching English as a foreign language (TEFL) at a local school.
Qualifications and startup costs
Even though there is a need for English-speaking teachers all over the world, it’s not enough to show up in another country with a perfect command of your native tongue and expect to find a job. You must take a TEFL or TESOL (Teaching English to Speakers of Other Languages) certification course, which can cost as much as $2,000, depending on which organization you choose for certification.
As Lauren Bauer, the senior teach abroad manager at Greenheart Travel, explained to Business Insider, “Any legitimate organization should be accredited and … most hiring schools will want someone with a minimum of 100 to 120 hours of training.” She noted that the best programs “offer practice teaching experience, placement assistance once you earn your certification, and generous pre-departure and on-site support.”
In addition, unless you are committing to a teaching position in a very wealthy country, such as Saudi Arabia or the United Arab Emirates, you will have to cover the cost of your flight to your new home yourself. You will also need at least a month’s worth of spending money to last you until you receive your first paycheck, so careful planning and budgeting is in order.
Cost of living while teaching English abroad
The good news is that the majority of the countries where you might teach English abroad have a much lower cost of living than the United States.
For instance, either public transportation or a bicycle will be all that you need to get around in your new home, saving you a car payment, car insurance, gas, and maintenance. Rent and food will also set you back far less in other countries, meaning your monthly paychecks will go much farther. Many of the countries where you might teach will also allow you to join the national health insurance program.
Foreign Earned Income Exclusion
Another great benefit of teaching English abroad is the fact that you pay no U.S. taxes on anything you earn under $101,300 as of 2016. In order to qualify for the Foreign Earned Income Exclusion, you must live outside the U.S. for 330 days over 12 consecutive months.
You will still owe local taxes on your wages, so the money you earn is not completely tax-free. However, you are likely to have a much lower tax burden by teaching abroad, allowing you to set even more money aside for your student loan payments.
Should you teach English abroad to pay off your student debt?
For some graduates, teaching English abroad is both an exciting adventure and a savvy financial move. But living abroad while paying off student loans is not for everyone.
Most teachers in that position must still carefully budget their money to make sure they can cover their debts, and budgeting while abroad can feel constricting if friends and other expats are living in vacation mode.
It’s also important to remember that it can be psychologically challenging to immerse yourself in a completely different culture — the costs of changing your mind are high.
If you dream of traveling but are not sure about the demands of living abroad long-term, it might be smarter to pay off your student loans at home and plan for travel once they are gone.
Interested in refinancing student loans?Here are the top 6 lenders of 2019!
|Lender||Variable APR||Eligible Degrees|
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.36% APR (with Auto Pay) to 7.82% APR (with Auto Pay). Variable rate loan rates range from 2.41% APR (with Auto Pay) to 6.99% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of April 17, 2019, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 04/17/2019. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on our student loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for SoFi.
3 Important Disclosures for Laurel Road.
Laurel Road Disclosures
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the fixed rate will decrease by 0.25%, and will increase back up to the regular fixed interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
All credit products are subject to credit approval.
Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.45% effective May 10, 2019.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.41% – 6.99%1||Undergrad & Graduate|
|2.41% – 7.89%2||Undergrad & Graduate|
|2.43% – 6.65%3||Undergrad & Graduate|
|2.38% – 6.81%4||Undergrad & Graduate|
|2.41% – 7.95%5||Undergrad & Graduate|
|2.60% – 9.60%6||Undergrad & Graduate|