Banks such as HSBC know that affluent/HNW clients look to them for advice about the financial aspects of such international education.

A growing number of parents in Asia give high priority to educating their children abroad, but they’re feeling the financial pain, a report from HSBC shows.

The HSBC Global Quality of Life Report 2024, based on interviews with 11,500 affluent people in 11 markets worldwide, highlights that a three- or four-year degree programme in certain countries – the US, the UK, Australia and Canada – can cost between $192,000 and $256,000 per child. Paying for it can use up to two thirds (66 per cent) of parents’ retirement savings in markets such as India and Indonesia and around 20 per cent in Hong Kong.

The markets surveyed include mainland China, Hong Kong, Taiwan, India, Singapore, Malaysia, Indonesia, the United Arab Emirates, the UK, the US and Mexico.

The willingness of parents in certain regions to send their offspring to schools/universities in countries such as the US, Switzerland or Australia, is partly driven by a desire to give them access to hoped-for "elite" education experiences, not least in countries where English is the dominant language, as well as giving them the opportunity to make friends with networks of people from similar backgrounds. The rise of such international education is to some extent a facet of globalisation. Also, when young adults return to their home countries, they can bring new – sometimes disruptive – ideas back with them. Banks such as HSBC know that affluent/HNW clients look to them for advice about the financial aspects of such international education.

The survey also shows that 55 per cent of affluent parents in Asia have an education saving plan – begging the question of what the remaining 45 per cent do to prepare, if at all. Nearly a third (31 per cent) expect their child to take on student loans, 45 per cent are hopeful for scholarships and 22 per cent would even consider selling assets to fund their child’s education.

There is increasing political controversy around the world about the cost of higher education, and the student debt amassed because of it, especially in countries such as the US and UK. Recent disorder in US university campuses over topics such as Israel/Gaza, concern about the loss of free speech, plagiarism and other issues, has prompted debate about the value of higher education more generally when set against other post-school options.

Varying costs

Source: HSBC

Financial concerns
In other findings from the HSBC report, it said that while parents have concerns about different aspects of their child’s wellbeing overseas, financial concerns (95 per cent) are high on their minds, compared with social or mental concerns (75 per cent) and physical or health concerns (71 per cent). 

The ability to set up essential banking services in their new location (41 per cent), keeping safe from financial scams (39 per cent), and maintaining an emergency fund for unexpected costs (38 per cent) are the top three financial concerns.

“Despite the rising cost of overseas education, over half of affluent families in Asia are planning or have already sent their children to study abroad,” Kai Zhang (pictured below), head of wealth and personal banking, South Asia, HSBC, said. “While China and India remain the biggest international student populations, an increasing number of young people in Southeast Asia are following suit. Beyond the West, Singapore and Australia are becoming top choices for international education among Asian affluent families." 

Kai Zhang