Saving Money in Korea

This morning, I received an email from a Southerner Abroad reader with the following question:

“I will be earning an average ESL teacher salary and was wondering if you have any tips on how to maximize my savings.”

This is a common question for those planning to teach abroad. Many people want to know how to save money and how much they can save each year. The answer is – it depends. There are many factors at play here. Your income, where you live, how much you plan to travel, and how much you like to party will all affect your ability to save.

I’ll assume that you live in one a medium or large city (Seoul, Busan, Daegu, Incheon, Dajeon, Etc) and that you have access to the same businesses I do in Daegu. Let’s also assume that “average ESL teacher salary” means roughly $2,000 per month (2-2.5 mil won).

In the past two years, these are the areas that have most significantly affected my bank account.

Food

Ajumma working in kimbap shop

If you like Korean food, and can do without comfort food from home, you’re already ahead. Western food, especially from restaurants, is quite expensive. I usually eat one or two western meals per month, so this is a minor expense for me.

Every neighborhood will have at least one kimbap restaurant, which is like the Korean version of a diner in the US. The food is cheap and service is usually friendly. This is where I buy about half of my meals. You can get a lot of food for $3-$5. A small meal will only run you $1.50.

My first few months here, I bought into the myth that eating out is cheaper than cooking your own food in Korea. This is just not true. The trick is avoiding Costco and E-Mart when you buy groceries. There are plenty of bulk food stores (the kind that sell food and supplies to local restaurants) that have decent prices.

Alcohol

This one is simple – the less you drink, the more you will be able to save. Fortunately, it’s easy to drink on the cheap here. Soju, Korea’s most popular alcoholic drink, is ridiculously cheap. You can literally kill yourself (with soju) for about $5.

Bottle of soju on a table

Photo source – a great blog post about soju.

I am not a fan of soju, so the way I drink without spending too much is by pre-gaming at home and buying drinks from convenience stores. Many stores set up tables and chairs outside for their customers. I actually enjoy this style of drinking more than in bar during the warm months.

Transportation

This one is simple – ride the bus. For some reason, I was nervous about taking buses my first year. I only used the subway and taxis. I was worried about getting on the wrong bus or missing my stop. Once someone introduced me to a smart phone app (Daegu Bus) that shows all the bus routes and tracks your current location, I started riding the bus often.

The savings were immediate. Instead of $3-$10 for a taxi ride, I could pay about $1 for a bus ride anywhere in the city. Most cities even offer discounts if you transfer from one bus to another (or from a bus to the subway) within 30 minutes. After a few weeks, I didn’t even need the app. I know all of the local bus routes by heart.

Travel

This is my big financial downfall. I spend a lot of time travelling around Korea, which can get expensive quickly. Fortunately, there are some ways to save money.

KTX (Korea’s express train) is fast and convenient, but it’s not the cheapest option. You can save 20-50% on transportation costs by taking a slower train or  an inter-city bus.

If you stay overnight, look for a guesthouse. Korean guesthouses (or hostels) are generally much nicer than what you find in Europe. It’s a relatively new trend here, so most are new. You can get a shared room for $15-$30 per night or a private room for as low as $45.

There are plenty of other ways to save money in Korea, but they’re all basically the same as any western country. Depending on where you live and how frugal you can be, it’s possible to save upwards of $8,000 each year. I send $700 (or more) home each month to pay off loans and I still live comfortably.

If you’re from the US, Canada or Australia, you receive a 100% refund on your government pension. If your employer contributes to your national pension account, this means an extra $2,000+ per year (but you can’t access it until you leave).

I hope this helps. If you have any other questions, feel free to shoot me a message via the questions page.

Until next time.

-Taft

Tagged , , , , , , , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: