You’ve done it! After months of hard work, you’re holding a Confirmation of Enrolment (CoE) from your dream Australian university. The excitement is real. But now, you face what many students consider the final, most stressful boss level of the study abroad journey: proving your financial capacity.
The number one reason for Australian student visa (subclass 500) rejections isn’t academics or English scores; it’s often related to finances. The rules can seem confusing, the numbers look huge, and a single mistake in your documents can lead to a heartbreaking refusal.
But don’t let this intimidate you. This is not a guesswork game. The Australian Department of Home Affairs provides an explicit formula for calculating the amount you need to show.
This ultimate guide will demystify the entire process. We will give you the exact formula, provide a step-by-step calculation, detail the acceptable sources of funds, and show you the common mistakes to avoid. By the end of this article, you will know precisely how much bank balance is required and how to present it for a successful visa approval in 2026.
The Golden Formula: Calculating Your “Show Money” for 2026
The Australian government needs to be sure that you can comfortably support yourself financially during your studies without facing hardship. To do this, they require you to show that you have access to sufficient funds to cover your expenses for the first 12 months of your stay.
The formula is simple and has four main parts:
Total Funds Required = (1 Year of Tuition Fees) + (1 Year of Living Costs) + (Travel Costs) + (OSHC)
Let’s break down each component.
Component 1: Your First Year’s Tuition Fees
This is the easiest part. The exact amount for your first year of tuition will be mentioned on your Confirmation of Enrolment (CoE) document provided by your university.
Component 2: One Year of Living Costs (The Official Figure)
The Australian Government sets a standard figure for the minimum cost of living for a student for one year. As of late 2023, this amount was increased to AUD $24,505. This figure is reviewed periodically, but you should use this as the basis for your 2026 planning. This amount is meant to cover your accommodation, food, transport, and other personal expenses.
- In Indian Rupees: AUD 24,505 is approximately ₹13.5 Lakhs (assuming an exchange rate of 1 AUD = 55 INR).
Component 3: Your Travel Costs
You need to account for your flight tickets to and from Australia. A standard amount is usually considered for this.
- For applicants outside Australia (like from India): A general estimate of AUD $2,500 (approx. ₹1.4 Lakhs) is sufficient.
Component 4: Overseas Student Health Cover (OSHC)
All international students in Australia must have health insurance, known as OSHC. The cost of your OSHC for the entire duration of your course must be paid up front before you apply for your visa. The price will be mentioned on your university’s offer letter.
Let’s Do the Math: A Sample Calculation
Let’s imagine a student named Priya from Bangalore who is going for a Master of Data Science at a university in Melbourne.
- 1 Year Tuition Fee (from CoE): AUD $40,000
- 1 Year Living Costs: AUD $24,505
- Travel Costs: AUD $2,500
- OSHC (for 2 years): AUD $1,200
Total Funds Priya Needs to Show: $40,000 + $24,505 + $2,500 + $1,200 = AUD $68,205
In Indian Rupees, Priya would need to show approximately ₹37.5 Lakhs.
Where Can the Money Come From? Acceptable Sources of Funds
Knowing how much to show is only half the battle. Knowing where the money can come from is just as important. The funds must be from legitimate and verifiable sources.
Also Read: How to Apply for an Education Loan for Studying Abroad?
Option 1: Education Loans from Approved Banks
This is one of the most common and accepted methods. You can show a loan sanction letter from a recognised bank (Public, Private, or approved NBFCs). The letter must be in your name or your sponsor’s name and should clearly state the total loan amount.
Option 2: Personal Savings & Fixed Deposits
You or your sponsor can show funds from savings accounts or Fixed Deposits (FDs).
- The “3-Month Rule”: Crucially, these funds should generally be at least 3 months old. This is to prove that the money is genuinely available and not just borrowed and deposited for the sake of the visa application.
Option 3: Sponsorship from Parents/Spouse/Grandparents
Your parents, spouse, or, in some cases, grandparents can sponsor your education. They will need to provide:
- Proof of their relationship to you (e.g., birth certificate).
- Evidence of their income (IT Returns for the last 2-3 years, salary slips, etc.).
- An official affidavit of support stating that they are sponsoring your education.
Also Read: Australia Visa Rejection? How to Get Approved in 2026
Acceptable vs. Unacceptable Funds: A Clear Guide
|
✅ Acceptable Sources of Funds |
❌ Unacceptable/Risky Sources of Funds |
|
Education Loan from a recognised Indian bank. |
Loans from friends, relatives (other than parents/spouse), or unofficial money lenders. |
|
Savings account or Fixed Deposit statements (held for 3+ months). |
“Funds Parking” – Large, unexplained cash deposits made just before the application. |
|
Parents’/Spouse’s Provident Fund (PF/GPF) statement with withdrawal eligibility. |
Funds from the sale of agricultural land are without a powerful and clear paper trail. |
|
Official scholarship letter from the university or government. |
Funds held in co-operative banks or credit societies are not fully regulated. |
The Art of Presentation: Your Financial Document Checklist
How you present your documents is critical. They must be clear, organised, and easy for the visa officer to understand.
For Education Loans:
- A detailed loan sanction letter from the bank on its official letterhead.
- It should mention the total loan amount, your name, the university’s name, and the terms of the loan.
For Personal/Sponsor Funds:
- Bank statements for the last 3-6 months.
- Fixed Deposit receipts (if applicable).
- Income Tax Returns for the sponsor for the last 2-3 years.
- An affidavit of support from your sponsor on stamp paper.
Common Mistakes That Lead to Rejection (And How to Avoid Them)
- The #1 Mistake: “Funds Parking” This is the most enormous red flag. If a large sum of money suddenly appears in your or your sponsor’s account a week before you apply for the visa, the officer will likely assume it has been borrowed temporarily just to meet the requirement. This can lead to an instant rejection. All funds must have a clear, documented history.
- Inconsistent Information: Ensure the name and address on your bank statements match your passport and other application documents perfectly.
- Not Providing a “Money Trail” If you recently sold a property or matured an FD to gather the funds, provide the legal sale deed or the FD maturity certificate to show a clear paper trail of where the money came from.
- Submitting Documents in a Regional Language: All documents must be in English. If your property deeds or bank statements are in a regional language, you must get them officially translated by a certified translator.
Your Path to Visa Success Starts with Preparation
Proving your financial capacity for an Australian student visa is a detailed and meticulous process, but it is not impossible. It is a test of your organisation, transparency, and genuine intent. By understanding the formula, gathering funds from acceptable sources, and presenting your documents perfectly, you are showing the visa officer that you are a serious, well-prepared, and genuine student.
The new, stricter rules mean there is no room for error. Every document must be perfect.
Feeling overwhelmed by the numbers and paperwork?
Don’t risk your future on a simple mistake. As Bangalore’s leading study abroad consultants, GlocalED offers a free document checklist review and expert guidance through the entire financial proof and visa application process. Let’s get it right the first time.
Frequently Asked Questions (FAQs)
Do I need to show funds if I have a full (100%) scholarship?
If your scholarship covers all your tuition fees and provides a stipend for living costs that is equal to or greater than AUD $24,505 per year, you may not need to show additional personal funds. However, you must provide the official scholarship letter as evidence. It’s always wise to have some buffer funds available.
How old should the funds in my bank account be?
It is a standard and highly recommended practice that funds shown from savings or FDs should be at least three months old. This demonstrates to the visa officer that the money is genuinely yours or your family’s and has been stable over time.
Can I show funds from a PF/GPF (Provident Fund) account?
Yes, you can show your parents’ PF/GPF as a source of funds. You will need to submit the official PF/GPF statement and a letter from their employer stating the withdrawal eligibility.
What if the value of my property is very high? Can I use that as proof of funds?
No, you cannot show the property itself as direct proof of funds. The Australian government requires you to show liquid funds—money that is readily available to be spent. While you can take a loan against a property (a secured loan), the property’s valuation report alone is not accepted as financial proof.
How much living costs do I need to show for my dependents (spouse/child)?
If you are taking your family with you, you must show additional funds. The current requirement is AUD $8,574 for your spouse/partner and AUD $3,670 for each child.