Saving so your child can go to college or university can be one of the best things you do for them. The extra education can really pay off because:
- College and university graduates are more likely to get jobs than people with less education.
- They are more likely to keep their jobs when times are tough.
- They also earn more.
But the costs of getting an education keep going up. Over the past decade, tuition fees and other student costs have more than doubled — and they have been rising faster than family income. A year in a university arts or science program can now cost several thousand dollars.
Students face other costs if they go to school away from home. A year of living on campus can easily cost $10,000 or more. Fifteen to 20 years from now, total costs to send your child to school for four years could add up to more than $75,000!
That’s why more and more families are looking ahead. They start saving early for their children’s education. Even small savings each year can add up to big savings later.
Did you know?
About two out of three new jobs today require more education than high school. People need more skills before they can start to build solid careers. For instance, they have to know how to work with technology on the shop floor and in the office.
That is why almost a million Canadians are full-time students in universities, colleges, vocational and technical institutes, and CEGEPs (Collèges d’enseignement général et professional, a term used in Quebec). Another 430,000 Canadians are part-time students. Canada has the biggest share of its 18- to 21-year olds in post-secondary education of all industrialized countries.
Getting started: How to save more for your child’s education
Many parents wonder how much to save. They also wonder how soon they should start. The answer is simple: Save as much as you can afford. Start today.
Use this calculator to create or fine tune your plans to save for your children’s education savings. You’ll be surprised how fast money in a Registered Education Saving Plan (RESP) can grow when you start early. The government will also help you save through the Canada Education Savings Grant (CESG) and the Canada Learning Bond (CLB).
Visit the following sites of the federal government to learn more about The Canada Education Savings Grant and The Canada Learning Bond:
See how saving just a few dollars each month can make a big difference:
- Maria and Gregor had a baby girl, named Hayley, on January 1, 2005. They want to start saving for her education right away. Their family income is about $35,000 each year and they get the National Child Benefit Supplement each month.See how Maria and Gregor saved $15,000 for Hayley’s education.
- Gini and Bindu have a three-year old named Bina. Gini takes care of their child and home, while Bindu earns $75,000 each year.See how they saved more than $19,000 in 15 years.
Saving for your children’s education takes planning. And, like saving for retirement, the earlier you start the better.
Tip: If an RESP isn’t for you — or if you want to save more than the plan allows — there are other ways to save. Some people use life insurance. Others open some kind of trust account. Or they use a regular investment account. Just remember, you won’t get any government grants with these options.