Molly Miller completed her undergraduate studies with dual bachelor’s degrees and is now contemplating pursuing a graduate degree. Reflecting on the financial aspect, she expressed, “A master’s wouldn’t be possible if I owed a lot of money.” Growing up in Fredericton, she envisioned attending a university away from home but eventually decided to stay close due to the substantial costs associated with out-of-province education. Miller, who will soon graduate with degrees in psychology and leadership from the University of New Brunswick, financed her education through a combination of scholarships and Registered Education Savings Plans (RESPs).
The average annual tuition fees for Canadian undergraduates have increased to $7,076, more than double the amount paid by the previous generation in 1990. Miller’s decision to prioritize financial prudence has allowed her to graduate without debt or regrets. She exemplifies the benefits of early financial planning for education, as her parents and grandparents contributed to her RESP from a young age, ensuring a solid foundation for her academic journey.
RESPs have become a popular choice for families to save for post-secondary education, with government grants matching contributions up to a certain limit. However, research indicates that RESP participation tends to favor wealthier households, highlighting disparities in access to educational funding. Anne Arbour from the Credit Counselling Society emphasizes the importance of early savings for education, acknowledging the challenges faced by families with limited financial resources in the current economic climate.
For students like Kameela Nash, whose parents started contributing to an RESP when she was young, the accumulated funds provided crucial support for her journalism and business administration studies. Strategic planning for RESP withdrawals, including understanding the tax implications of Education Assistance Payments (EAPs) and capital withdrawals, can optimize the use of these savings. Additionally, initiatives like the Canada Learning Bond (CLB) aim to assist low-income families in kick-starting their post-secondary savings, albeit with varying levels of awareness and uptake.
Student loans and grants offer another avenue for funding higher education, with flexible repayment options and interest-free federal loans. Scholarships, totaling nearly $250 million in Canada, present additional opportunities for financial support based on various criteria beyond academic performance. Working while studying, as exemplified by students like Josh Elias, can help cover expenses not met by other funding sources, providing valuable work experience and income.
Ultimately, exploring diverse funding options, such as strategic RESP withdrawals, government grants, scholarships, and student employment, can alleviate the financial burden of post-secondary education. By considering cost-effective choices like living at home and maximizing available resources, students can navigate the financial challenges of pursuing higher education without compromising their academic goals or accruing excessive debt.