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Money Matters for
International Students in the USA
Money Matters
As you may have already discovered, paying for a quality education in the
United States can be very expensive. But with proper preparation, you may
minimize the costs of this extraordinary opportunity; visit our Financing page
to learn more about paying for tuition. In this section, we explore money
matters that you may encounter on a daily basis during your adventure in the
United States.
As with any country, it is not advisable to carry large amounts of cash around
with you. There are other options such as credit cards, traveler’s checks or
bank cards (also called debit cards), which are all valid forms with which to
pay for things in the United States.
Traveler’s checks are one of the safest and easiest ways to transport money
because you may have them replaced if they get lost or stolen. If you choose to
carry traveler’s checks with you from your home country to the States, be sure
they are denominated in U.S. funds. Most businesses—except taxi drivers and
public transportation personnel—
will accept U.S.-denominated traveler’s checks during regular business hours,
typically between 9 a.m. and 5 p.m. Monday through Friday. It is wise to bring
about $100 in U.S. cash with you, so you will be able to manage upon your
arrival in the States.
U.S. Currency
United States currency is based on a decimal system, with one dollar ($1 or
$1.00) equal to one hundred cents. Coin currency is used for amounts less than
one dollar; the most common coins and their equivalencies follow:
• penny equals one cent or 0.01 dollars
• nickel equals five cents or 0.05 dollars
• dime equals ten cents or 0.10 dollars
• quarter equals twenty-five cents or 0.25 dollars
It may take a few days to get used to the new currency. You will learn, for
example, that $1 is a reasonable price for a can of cola out of a vending
machine; two dollars for the same item is expensive. Five dollars for a pizza is
inexpensive, while twelve dollars is expensive.
Paper currency, all printed in green and white, is most often circulated in the
amounts of $1, $5, $10, $20, $50 or $100. The slang term for a dollar bill is a
"buck,” so $50 may be referred to as "fifty bucks."
Most banks and some major airports and hotels will exchange foreign paper
currency for a service fee; very few, however, exchange foreign coinage. Pay
attention to drastic fluctuations in the exchange rates between your home
country’s currency and U.S. currency. If your home currency is decreasing in
value, you may wish to conduct all transactions (like student loans) in U.S.
currency.
Bank Accounts
Within the first few days of your arrival, you may want to open a checking
account with a bank on or near campus. You may directly deposit traveler’s
checks for free in most cases, or arrange for a wire transfer from your home
bank for a fee of about $35. Typically, you may make an unlimited number of
additional deposits or withdrawals thereafter. Be sure to always have sufficient
funds in your account to cover all outstanding checks; if you "overdraw," the
bank may impose expensive fees. Also be aware that there is usually a waiting
period of a few days before you may withdraw the money you deposit, as a way for
the bank to protect itself from fraud.
You will most likely need some form of identification to open a checking
account. The bank representative may ask you for your Social Security Number. If
you do not have one, fill out an IRS Form W-8, which the bank can supply.
Most banks offer a number of different types of checking accounts. One might
bear interest if you maintain a minimum balance; another might provide a limited
number of free checks. Learn about all options before deciding which type of
account is best for you.
Many college students appreciate the convenience of a MAC (Money Access Card) or
ATM (Automatic Teller Machine) card. The card allows account holders to make
deposits, withdrawals and other transactions at any time—24 hours a day—through
machines located throughout campus and shopping districts. If you have an ATM
card from a bank in your home country, ask whether the U.S. bank will honor it;
some Personal Identification Numbers (PINs) cross national borders, while others
do not. As a safety precaution, most ATMs limit the daily withdrawal amount to
$300. If you happen to lose your ATM or MAC card, report it immediately to your
local bank office.
Writing a check is simple. The dollar amount is written twice: once using
numerals ($67.32 for example) and once using words (sixty-seven dollars and
32/100). Draw one horizontal line through any unused space after the words, to
prevent someone from adding extra digits.
Once a month, the bank typically mails the account holder a statement of all
transactions. It is important to make sure that their records match your records
to ensure that no errors were made by them or by you. If you have a question
about your account, contact your local bank office.
Generally, retail stores accept checks only if they are drawn on an in-state
bank. Be prepared to show some form of photo identification, such as a driver’s
license, student I.D., or passport (though you may not want to carry such an
important document with you all the time).
Credit and Debit Cards
One payment option accepted nationwide is the credit card. As a matter of fact,
you may find it difficult to make certain purchases without a credit card. You
need one to place an order by phone, to rent a car, or buy airline tickets in
most instances. A credit card is also a good idea if you want to maintain good
financial records, as your monthly statement will serve as a reminder of how you
are spending money.
A credit card may turn into a very expensive payment option if you are not able
to pay the balance on the account within the specified grace period—typically
between 20 and 30 days. Be careful to read all of the details of the credit card
offer before committing to it; some companies offer a special low introductory
interest rate (perhaps 2.9%), but then increase it dramatically (to about 18.9%)
after that introductory period. Also know the structure of the credit card
company’s annual fees, such as how much and when they charge it to your card. As
always, learn all you can so that you can make an informed decision.
Some companies are reluctant to issue credit cards to international students, as
they do not have an established credit history in the United States. If you
already have a major credit card from your home country (like Eurocard, Access,
Chargex, Barclaycard, Carte Bleue, American Express, Visa or MasterCard), bring
it with you; after the U.S. bank reviews your credit limit on the foreign card,
they may be more likely to offer you a credit card. Banks with which you have
accounts are also more likely to accept your request for a credit card.
Debit Cards (also referred to as “bank cards”) are another option. When you open
an account, you will most likely get a bank card which you can use to withdraw
money from an ATM. You can also use it like a credit card to make purchases.
Unlike credit cards, the money is instantly taken from your account, so if the
money is not there it will be rejected.
For students new to the USA, the debit card is a great way to pay for things
until you can establish credit.
( Source:
http://www.internationalstudent.com/study_usa/way-of-life/money-matters.shtml )
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