Ways to Save for College or University

For many, education is an investment in oneself. And while the future payoff in terms of earning potential is proven, young professionals are more likely than ever to cross the stage and receive their degree or diploma with debt. According to the Canadian Federation of Students, the average debt for university graduates is close to $30,000 with 77% of students reporting having regrets about student debt. It’s no surprise that parents, grandparents and extended family members want to help. This month, instead of talking about learning to save, we're sharing some tips for saving to learn:

• Start saving, even if you start small: An everyday non-registered savings account, such as CUA's mySavings Account, can be both flexible and effective at placing funds where you need them, for when you need them most. A Tax-Free Savings Account is also a great option if you want the option of withdrawing funds, when required, without paying taxes (which would be required if you withdrew from a registered savings account or plan). 

• Consider a Registered Education Savings Plan (RESP): This dedicated savings plan will help you save for the future by putting money away periodically. RESPs also offer a big advantage in the form of a Canada Education Savings Grant from the Government of Canada, meaning RESPs can receive top-up payments up to a maximum lifetime amount of $7,200 per child. The longer you have to save, the most 'free' money you can receive.

• Maximize Government credits: Canada's provincial and Federal Governments support education in a number of ways. When your child is born, you can apply for the Canada Child Benefit, a tax-free monthly payment made to eligible families to help with everyday costs. The Canada Revenue Agency (CRA) uses information from your income tax returns to determine how much your monthly payment will be. Throughout the year, save your receipts as there may be opportunities for other tax credits available to your family. Making the most of everyday cash flow can help to find a small amount to put away for your child's future.  

• Explore post-secondary options: While many students choose to go to one of the province's 10 universities to earn a degree that can lead to a rewarding and well-paid career, that's not always the case for everyone. Nova Scotia Community College (NSCC), for example, offers more than 120 programs at 13 campuses throughout the province. These programs are typically faster and less costly than university programs, and with 88% of NSCC graduates employed, it provides a great post-secondary option for students. Apprenticeship programs are another great option, and offer extensive, supervised, on-the-job experience and technical training. Like university programs, government grants, bursaries and scholarships can help to reduce community college costs, as can great savings habits!

Don't wait to talk about money. No matter their age, you can start teaching your kids about saving (and spending) money. Encourage them to watch CUA's It's A Money Thing videos to learn about basic banking, budgeting and the importance of credit history. Talk about scholarships and bursaries, and the impact of good grades, community involvement and student leadership. Open up a free CUA Youth Banking account, and let them know we’re here to help answer their questions - and yours! When you pay bills or plan your meals, make it a game and talk about budgeting. Learning about money matters early on can have a huge impact on your child’s financial future. There is no better time to start saving.

If you would like to speak to a member of the CUA team about saving for education, give us a call at 902.492.6500.

Revised Jul. 16, 2021

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