Parents often worry about the future as their children get closer to university age. What kind of career will they have? What post-secondary institution will they go to? How will they pay for the cost of higher education?
The costs of pursuing education beyond high school can add up, especially for those students who don’t live at home while they study. According to Macleans Magazine, university students who live away from home can expect to pay upwards of $20,000 per year. Those who choose to live at home pay about half of that.
Most Canadian parents do expect to help cover the bills when it comes time to pay for their child’s education, according to a TD Canada Trust Education and Finances survey. The results revealed that 87 percent of Canadian parents expect that they will pay for their child’s post-secondary education, but there is a gap between what parents want to do and what they can afford. 26 percent of parents surveyed say they have yet to start saving and another 15 percent have no idea how they will finance it.
Despite this knowledge, the same Macleans report says that about two-thirds of today’s students are without a Registered Education Savings Plan (RESP), which means that in past years, more parents should have taken advantage of this important vehicle for saving for post-secondary education. These tax-sheltered savings vehicles can offset a child’s future education costs. Anyone can open an RESP for a child: parents, grandparents, guardians, relatives and even friends.
The gift of an education is one of the greatest investments a parent can provide for their child. Committing to a sound savings plan now, like an RESP distributed by CST Consultants Inc., can help eliminate financial stress in the future. Students, with the help from their parents, can also apply for the many awards, grants and bursaries offered by The CST Foundation.
One of the most attractive things about RESPs is that the federal government contributes to the plan via the Canada Education Savings Grant (CESG) and the Canada Learning Bond (CLB). There are also some education savings grants offered by provincial governments.
In addition to benefiting from government grants, flexibility is also built into saving for higher education through an RESP. Parents can set their financial goals and make payments that work within their budgets. When it comes to preparing your child for a debt-free future, even a little saving can go a long way.
CST RESP Real Stories
Comments coming directly from students whose parents invested in RESPs demonstrate the value of saving for higher education through these saving vehicles.
Take a look at some of the positive feedback from the CST Graduate Award recipients who benefitted from having a CST RESP.
Natasha Goncharenko, for example, who is embarking on a Master’s Degree in Clinical Science in Speech Language Pathology, says her parent’s perseverance to save set her up with a bright future.
“Having this RESP and the income from that has really helped me to focus on my schooling, as well as all the training that’s required to compete at the sport that I love. So without these funds it would be impossible to achieve.”
Other CST Graduate Award recipients agree that their parents’ sacrifice and their choice to set up a CST RESP helped relieve the financial stress coming from post-secondary studies.
“My parents fled a war to come to Canada. The fact that they gave everything to me and that I can now use that to go and create change back home for them, it just means everything to me,” Ruth Lebel-Almaw said, another student benefitting from a CST RESP.
Touching on a similar point, student Zion Lee said: “It’s been a journey just to continue to support one another and continue to emphasize the importance of education, considering our financial circumstances.”
Student debt can be a heavy burden to carry at the beginning of a young adult’s working life. But, with some forethought and careful planning, parents can lighten the financial load for their children—and themselves.
Canadian Scholarship Trust Plan, distributed by C.S.T. Consultants Inc., is only sold by Prospectus.