Here’s a little known fact about me. I’m rich.
Okay, not really. But over the past year I have managed to save a lot more money than I ever expected to save. Over $10,000 (Canadian) to be more precise. It actually wasn’t that hard: I know plenty of people who have managed to save even more than that. It all boils down to a few simple lifestyle tips and changes that you can easily get used to and work into your routine. So, ready to pay off those pesky student loans or credit card debts? Want to save money for grad school? Here’s my short guide to saving (and making!) money while teaching English abroad.
A little note: I’ve been teaching in China for the past year, so my money-saving guide is tailored towards China. However, this advice can apply to many different countries around the world, and I’ve heard you can save even more money teaching elsewhere, like South Korea, or in the rich oil-producing countries of the Middle East (Saudi Arabia, Kuwait, the UAE, or Qatar).
Tip #1: Don’t accept anything less than $1400 USD per month salary
For a first time English teacher with little experience, $1400 USD a month is about average for Asia, and there are certainly jobs out there that pay more. But if you’re looking to save a good portion of your earnings, accept no less than this. If you do nothing else to earn income other than your English teaching job, then that will give you at least $4000 (US) spending money for the year out of the $14000 (US) you will earn in total, if the goal is $10000. But there are other ways to make money that will make saving a lot easier. My current job pays me nearly $1500 (US) a month before taxes, which provides enough for me to finance my lifestyle and save money.
Tip #2: Find a company or school who will provide free housing or a housing allowance
Rent is going up in most major cities in the world, and can take a big chunk out of your monthly salary. The average rent for a normal one-bedroom apartment in my city (Shenzhen, China) can be around 3000-4000 RMB ($450-$600 US) and can be over 1000 RMB more ($150 US more) in expensive business districts. If you want to save money, paying that much for rent can be a HUGE setback. Fortunately, there are companies and schools who provide free housing or a housing allowance to cover your rent. Make sure to ask them before you accept any offer. The quality of free housing isn’t always the greatest, but you won’t be living in a cave. Plus, you’ll have handfuls of extra spending money!
Tip #3: Eat local food as much as possible
This simple tip will save you a ton of money down the road. Yes, every once in a while we absolutely need to splurge on a good burger or other Western foods at a decent restaurant, but on most days you only need to spend around $3-4 US for dinner at a local family run restaurant. Plus, the local food is good. Additionally, most schools will also provide you with free breakfast and lunch, so sometimes I would only need to spend $3-4 the entire day!
Tip #4: Use public transportation
I recently got into a bad habit of being lazy and taking cabs, even when it wasn’t necessary. Though it is convenient to hop into a cab and go, taking the bus or metro will end up saving you a bunch of money in the long run. Public transportation systems in large Asian cities are insanely cheap, and can take you nearly anywhere you need to go.
Now, even if you follow all the above tips perfectly, you’ll still find yourself budgeting and squeezing every last penny to save that $10000. To save money, you must make money. The next few tips will tell you how to make money.
Tip #5: Get tutoring jobs
I made tutoring my main secondary source of income. Tutoring English to children, usually only for an hour or two at a time, can net you a lot of extra cash. The average tutoring pay is about 200-250 RMB per hour in China ($30-40 US) which goes quite far considering cost of living. I tutored just five hours per week, with pay ranging from 200-250 RMB per hour, and made about $160 US a week, $640 extra a month. It easily covered my food expenses, enough that I could leave most of my paycheck in the bank. Many of my colleagues were tutoring twice as much as me and were making twice the money. I cannot stress how important it is to secure tutoring jobs. Ask colleagues, ask local friends, or walk in the street speaking English loudly, anything to help you tutor more children.
Tip #6: Take advantage of the exchange rate
2015-2016 was a tumultuous year for the global economy, which saw the precipitous fall of my beloved Canadian dollar. But luckily, the Chinese RMB also took a big hit. The only currency that seemed to be doing well was the US dollar!
I had a few options with my money. I could wait until I had gathered enough and exchange it into cash all at once to take home. Or I could watch the exchange rates and exchange money when it was most worth it. So that’s exactly what I did. I set up two PayPal accounts, one linked to my Chinese bank, the other linked to my Canadian bank. Every month, I would wait for the RMB to dip, then exchange money through PayPal. Sometimes it would dip even further and I would curse myself, but then I reminded myself it could have been worse. By doing this, I could make an extra $20-25 a month, which made me nearly $250 extra over 10 months.
Here’s an example:
On day 1, the exchange rate is 5.10 RMB to $1 CAD. If I exchanged 6000 RMB, I would get $1176 CAD.
But on day 7, the exchange rate is now 5.01 RMB to $1 CAD. If I exchanged 6000 RMB, I would get $1198 CAD. That’s a difference of $22. It doesn’t sound like much but again, it adds up.
Tip #7: Put your money into investments
My last piece of advice would be to invest aggressively. I took advantage of my bank’s mutual funds which allowed me to increase my money by doing almost nothing. Every month, when I sent money to my Canadian bank, I immediately invested a large portion of it (nearly 80% of it) into mutual funds. The rate of return on these funds can vary from year to year, but will usually average around 5-10%. I got lucky this year and had nearly a 10% return on investment, which, with some compound interest, made me a substantial amount of money.
These are just a few tips that helped me save over $10000 teaching English abroad for 10 months, though you could easily save more money. My personal goal for next year is $15000. If you have any more tips, feel free to share in the comments! I’d love to hear from you. Till next time!