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What is a stipend and its purposes? by Article Rocket

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What is a stipend and its purposes? by
Article Posted: 03/26/2018
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What is a stipend and its purposes?

What is the definition of a stipend? It's important to know both what this term means and its purpose if you're an intern who will receive one. A fixed sum of money paid periodically to cover expenses is stipend. With this short article, you can learn more about stipends and how they vary from wages.

Reasons Companies Offer Stipends - Stipends aren’t performance-based or hours based. A lot of corporations that are not able to afford to pay their interns on an hourly basis offer stipends to help students cover expenses that typically occur during the course of an internship, including costs related to food, travel, housing, and entertainment.

Companies should include that information on the advertisement for the internship and reiterate it during the interview if they plan to offer interns a stipend as a substitute of an hourly wage. Most students are not able to afford to work for a stipend alone and require paying internships to make ends meet.

Ask the employer if you can sign a work agreement acknowledging the stipend and when it will be paid in case you can afford to receive a stipend rather than an hourly wage. Weekly, bi-weekly or monthly basis stipends are paid by the majority of employers; however, some employers wait until the last day of the internship to distribute stipends. It is important to know how this process will work, so that you can plan when to pay your expenses. If there are any reasons the stipend would not be paid, you should know what they are before starting the internship.

Expenses Students Incur During Internships - A student commonly received a $100 stipend for an 8 to 12-week internship. They pay for the cost of bus tickets, Ubers or taxis, train tickets to get to and from the internship. The expenses on travel could range from zero dollars (if they walk to work) to thirty dollars per day or nearly $1800 over the course of an internship.

The expenses on food really depend on the students' situations and the area where they are living. They might have access to a kitchen if they stay with a friend or a relative, and they are able to buy groceries, or they might need to eat almost every meal out. They might pay additional to be on the college dorm's housing meal plan.

The cost of housing for an internship is also different. In most cities, students might be paying close to $400 per week to live in college dorms. Anyway, the cost of living could be nothing if an intern lives in the city or with a family member over the summer. Out-of-area students may need as much as $5,000 for living expenses over the summer.

If the employer is able to cover the cost of food (while at the internship), that’s certainly a respected and common gesture. Over the course of a 12-week period, if interns are budgeting wisely and spending $10 per day on food, that’s nearly $1,000 in food costs.

Students will spend a minimum of almost $1,000 to cover their food over the course of an internship based on these estimates. They could be spending upwards of $7,000 for their internship in case they also have travel and food costs to incur. Keep in mind these figures don't account for the several students who pay extra to be enrolled in school over the summer, so they can get credit for their internships.

The above figures also exclude entertainment costs, which typically vary. Companies are not expected to cover the expenses associated with an intern's social life.

How Much Companies Should Pay? Internship stipends are usually given out in increments of $250. Some companies offer $250, $500 or even $1,000 per month. In general, the best thing an employer can do is try to apprehend the expenses students face and come up with a stipend that will adequately cover them.

What is a stipend and its purposes has been conveyed in this short writing, and we hope you can understand in deep and manage it wisely for your period of internship.

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