While many students and their parents are already struggling
to pay for a university education, it is expected to get much more expensive in
the coming years.
Part-time jobs are already scarce for young people trying to
pay for their education, and many parents are wishing they had started saving
earlier. But the situation could get worse.`
More than 40% of Canadian parents are worried about how
their children will be able to afford post-secondary education, a new study
says.
And they have good reason to, considering that a four-year
university degree can cost more than $60,000 today and could rise to more than
$140,000 for a child born this year.
According to the study conducted for BMO Bank of Montreal,
83% of parents anticipate that they will pay for their child's post-secondary
education, while 44% say their child will pay for at least some of it
themselves.
Interestingly, the report revealed that more than 35% of
parents are not aware of key benefits of the Registered Education Savings Plan
(RESP), including the federal government's contribution matching program.
"Parents should educate themselves on the various
options available to help them save for their children's post-secondary
education," said Robert Armstrong, a spokesman for BMO Investments Inc.
"Taking advantage of the RESP government matching program is a great way
to grow your child's education fund. After all, if you can get free money from
the government to send your child to school, why not take advantage of
it?"
If parents open a RESP and make regular contributions,
government grants and compounded interest can add significantly to total
savings, Armstrong says.
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