Almost three-quarters of Canadian students believe they will have to supplement post-secondary education with additional training or certification, adding more expenses and potential debt, according a new poll from Toronto-based Canadian Imperial Bank of Commerce (CIBC).
In fact, 74% of current or part-time adults enrolled in a post-secondary institution say they will likely require more training, despite paying $14,000 a year and accumulating $30,000 of debt by graduation, on average, the report states.
Although Canadian students are concerned about this new economic reality, 41% still don't have any savings while 67% don't have a registered education savings plan (RESP) to rely on.
Now that the school year is approaching, it's a good time for financial advisors to speak with client families about post-secondary savings and RESPs.
"The big advantage to an RESP is the tax-free accumulation of savings combined with the added benefit of government grants," says David Nicholson, vice president with CIBC Imperial Service, in a statement. "It's a powerful combination, and every little bit can add up to a significant amount over time to help with your child's education."
In addition to opening an RESP, CIBC recommends the following tips for client families to ease the burden of tuition costs:
> Begin saving money early and consistently. Even small contributions are helpful.
> Create a clear estimate of the total bill. For example, break down how much money is required for tuition, books, meals and accommodation.
> Research ways to reduce the overall education bill, such as scholarships, bursaries, grants and special student offers.
> Define a probable career path in advance by understanding what extra education and experience may be required.
> Speak with a financial expert regularly about how best to manage savings and debt.
For more suggestions to share with clients, click on the link below to watch a slideshow.
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