Beyond RESPs: How to handle the high cost of education

I just dropped my daughter off for her first day of kindergarten – and while it was a HUGE milestone for her (and me – sniff) it didn’t cost much to get her there. Armed with a backpack, lunch and a new pair of kicks, she was off to a great start. But in another 14 years, it’s going to be a completely different story. The cost of a university or college education in Canada has skyrocketed. Statistics Canada shows tuition fees rising well above inflation – the average undergraduate shelled out $5,581 in tuition fees last year versus $5,313 a year earlier. And of course that doesn’t even cover the cost of books, food, transportation and residence.

So how are students (or parents) expected to cover the costs? While many families opt to save early through a Registered Education Savings Plan (RESP), it’s not in the cards for everyone. Luckily, Canada has some solid options. Whether it’s grants or loans or a mix of both, Canadian students can find the money to cover their education – they just have to do some research beforehand. Here are just a few key places to look:

The Ontario Student Assistance Program (OSAP) – OSAP gives you access to two kinds of money – grants (which you don’t have to pay back) and loans (which need to be repaid). This is the number one stop for students looking for help funding their post-secondary education. How much could you get? If you’re a student at a public college or university in Ontario, you can get up to $360 a week – or $560 if you have a spouse or you’re a sole support parent. OSAP also has grants for students in unique or special circumstances – for example, if you’re the first person in your family to go on to a post-secondary education or if you end up having to commute 80 kilometres or more.

Canada Student Grants – It’s money you don’t have to pay back – and it’s easy to apply. Just put in an application for student financial assistance through your school of choice and you’ll automatically be assessed for eligibility. Grants are given to students from low- or middle-income families, students with dependants and those with permanent disabilities. How much you get depends on your situation and level of need.

Apprenticeship Incentive Grant (AIG) – Want to learn on the job? The government has money for you. The AIG applies to anyone learning a certified “red seal” trade such as a baker, cook, carpenter or industrial mechanic. It’s a taxable cash grant of $1,000 per year, up to a maximum of $2,000 per person.

Scholarships – You don’t have to be a genius to get a scholarship. Depending on what source you check, there is up to $15 million in unclaimed scholarship money floating around year after year – and scholarship resource site provides information on more than $167,644,471 worth of scholarships. Some grant you as little as $50 and others are much, much larger. You can also check to find out what’s available. Go ahead and apply – it can’t hurt to try. After all, it could be free money!

File a tax return – It’s not all about grants and loans. Tax deductions for some education costs can help reduce the costs of your education and put extra money in the bank to boot. For example, if you’re 19 or over, you’re eligible for the GST/HST tax credit and, if you worked last summer and had tax taken off your cheque, you can probably get it all back. Learn more with this money guide for students.

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