Young people are in a more precarious situation than their elders
While it is believed that they are freer than their elders, on the contrary, they seem more "chained" and confronted with economic uncertainties. According to a study by the Collège étudiant du Québec (FECQ), 34% of students say they cannot meet their needs. The study, released in 2022, focuses on a panel consulted in 2021. With inflation rising in 2022 and remaining a significant concern in 2023, the FECQ rings the alarm. Food insecurity is affecting more and more young people and is accompanied by other challenges (access to healthcare, decent housing, cost of education, etc.). Financial difficulties impact the lives of young people; and some isolated young expatriates are even more severely affected.
Health crisis, economic crisis, rising tuition fees, and student precarity are significant issues
Covid indeed had catastrophic consequences on the finances of many young international students and aspiring expats. According to a study by the Belgian Financial Sector Federation (Febelfin), 6 out of 10 young people faced financial difficulties in 2021, mainly due to Covid. School closures deprived them of income. Stuck in their student rooms, unable to study properly and/or save money, these young people saw their purchasing power drastically reduced. The opening of borders has undoubtedly allowed the resumption of student mobility. But international mobility remains financially difficult for many young people because the crisis continues and is hitting all spheres of life. While it is not a result of the health crisis, it is worsening as the cost of education increases. This is particularly true for international students, who are considered a major financial resource for countries and are faced with ever-increasing tuition fees. This practice has been criticized by student associations and is deemed by some experts to be counterproductive. British universities, with Brexit, and Australian universities, with the health crisis, have suffered the consequences of their high fee strategy for international students. Despite their setbacks, France has also committed to increasing university fees for foreign students through its "Bienvenue en France" program.
Is it a generational problem?
From a macroeconomic perspective, seniors seem to fare better. For these "baby boomers," traveling and retiring abroad are more feasible. Over time, they have accumulated more wealth than younger generations and often own their homes. However, the real estate crisis has driven up property prices over the past years. The debt-to-income ratio of seniors is also lower than that of younger generations. These seniors have finished repaying their loans or are close to doing so. On the other hand, the younger generation is increasingly embarking on lengthier studies, delaying their entry into the workforce. They also face additional expenses, including a lifetime investment in the form of homeownership. However, the advantage of the "boomers" must be put into perspective, given the wide disparities. It is difficult to compare the situation in the 1950s and 1960s, coming out of the war without the existing social protections and advancements, with the current situation. Hence, we are very far from a "young vs. old" war.
High student debt
Is living abroad becoming an option only for privileged young people? Although it has not yet reached an open fracture, the prolonged crisis deprives millions of young people of living abroad plans. Those who stay in their home countries are not necessarily better off and face ever-increasing living costs. Some of the leading issues are funding for education, increasingly relying on credit, which is essential but burdensome. Let's take a closer look at the situation in some countries.
United States
In the United States, student debt is part of a heavy burden for millions of students. Precisely 43 million students have federal loans to repay, amounting to more than 1.8 trillion dollars (Data Education Initiative figures). Students borrow, on average, nearly $40,000, with peaks at $134,000 for law students and $208,000 for medical students. The situation, critical for years, has worsened with the crisis. So much so that Joe Biden proposed canceling part of the debt. A chasm, a burden, an abyss—all terms have been used to describe what makes life more difficult for millions of young people, caught between increasingly expensive and lengthy studies and the desire to live, quite simply. The weight of debt delays all other plans, including living abroad plans. 70% of Americans borrow for their studies, and 60% manage to repay their loans between 40 and 50 years old. Thus, they spend nearly a lifetime repaying their debt.
South Africa
In South Africa, the situation is becoming explosive. The cost of education increases yearly, while students' finances are reduced as the economic crisis persists. This year, South African students will have to pay an average of $3,000 to study, which many can no longer afford. And the universities' response only exacerbates their anger. Some universities exclude students who are unable to pay their tuition fees or refuse to issue their diplomas. In March, students at the University of Witwatersrand blocked the campus to protest. In 2021, 100,000 students were already deprived of diplomas because they had not paid their tuition fees. Since 2010, student debt has risen to over $500 million. Unlike the US, freezing the debt is, according to the universities, "unthinkable" if they want to continue functioning.
The universities acknowledge the "cruelty" of their sanction but claim that they are also stuck. They call for a national reflection on this problem, which deprives millions of students of prospects, both in the country and abroad. In April 2021, France Television reported the testimony of Telefo Mabuya, who was denied a diploma in hotel management because he had not fully repaid his debt (€3,500). This diploma retention deprived him of two internships abroad and a job on a cruise ship. Many other students in this situation are seeking measures to alleviate their debt. While the government provides scholarships, these are only available to the most precarious students. Therefore, the middle class bears the brunt of the tuition fee increases and their repercussions. Young talents who were promised opportunities abroad find themselves in great difficulty without a recognized degree. In 2019, President Ramaphosa promised free education, but it only applies to the first year.
Japan
We could say that Prime Minister Fumio Kishida wanted to "kill two birds with one stone." However, some proposals are better left unshared. Concerning the reduction of student debt, Kishida's attempt is not well-received. It could even be described as a scandal. In March, the government proposed reducing student debt for people who commit to having children. At the beginning of the year, it had planned surprising measures to boost the birth rate. Still, 2022 was another catastrophic year, with 800,000 fewer births—an unprecedented decline since 1899, when the first statistics were obtained.
Critics immediately began, both in the political sphere and among the population. The protestors are outraged by a measure that would treat Japanese people like "cattle." Conservatives are trying to defend their idea. For example, Deputy Masahiko Shibayama supports a measure to "financially support families." Senator Noriko Ishigaki, on the other hand, contests that "demanding a child in exchange for a reduction in student debt isn't an appropriate measure to tackle the low birth rate." Kishida remained rather discreet, letting the debate continue. Student debt remains a significant problem in Japan. In 2020, a survey by the National Institute for Science and Technology of the Japanese Ministry of Education revealed that 35.9% of graduates had to borrow to study. Half of them owed more than 3 million yen ($21,166).
Can you move abroad on a tight budget?
While the financial aspect of moving abroad is crucial, it should not dictate the choice of the country. "Smart relocation" by choosing countries with a low cost of living is a risk that does not take into account the possibility of finding work, career prospects, the actual cost of living once there (including the moral cost, possible returns to the home country, etc.).
To begin with, the project must be well-defined. Is it a short, medium, or long-term project? Do you want to live abroad for a few months or several years? To study, look for work, or work? Do you already have specific countries in mind? Do you want to go to a neighboring country or to the other side of the world? Will you need a visa?
Once you have outlined your project (it can be modified at any time), you can establish your budget. How much do you need to travel? What resources are available? Have you taken out a loan? When will it end? Do not hesitate to consult your banker. Experts point out that young people often lack information about finances and managing their money. These gaps could deprive them of rights (assistance, advantageous financial transactions, investments, etc.). Next, it's time to look for funding. Your options are state, regional, university, or private scholarships. These scholarships (excluding university scholarships) are not always reserved for students. Since procedures take time, it is better to start early.
Postponing the project for a few years to build up capital and/or revising the project to implement it better are options to consider. When it comes to relocating abroad, there is no magic formula but rather small adjustments that, taken together, allow you to make your dream come true.
