Back to School & Back to Education Savings


By Miles Clyne


It’s that time of year. both kids and parents are happy or anxious about the new school year.

But whatever you as the parent are thinking or feeling, another year has slipped by since the last time this happened.  Probably seems like no time at all and your kid(s) or grandkid(s) are another year older. If you are going to start saving for their education and are delaying, then it is time to get busy and decide how you are going to do it.

This link takes you to all the details that will be helpful in that regard. 

A significant factor with any saving program including education savings, is when you start.  There are typically three factors that determine how successful you are as an investor that they don’t teach in school but should: When you start, how much you contribute and the rate of return you get on your money. There is a fourth factor when it comes to education savings which is the option to use an RESP (Registered Education Savings Plan). Just by using an RESP and contributing up to $2500 annually you will be 20% further ahead through grants from the government. Be sure to understand the benefits of a Registered Education Savings Plan. The extra 20% that the government gives will go a long way in funding an education if it comes into the account in the year your child is born, and every year after. Waiting 15 years to start making contributions ends up being the more expensive option given the lost benefit of compounding returns on both the initial investment and the grants.

Striking the balance between the latest technology, clothes and education savings is something you should talk to your kids about early.  Engage them in the process so they can see what you are doing for them and they can even try to help.  Rather than the latest gadget or toy on a special occasion, maybe grandparents and friends would rather contribute to your children’s future. Teaching your children persistence and an understanding of how to make good investment choices cannot be a bad lesson, especially when it comes to their futures.

When your kids are grown, what do you want to look back on with fond memories? What will your children look back on? Our children are grown and we loved their university years, seeing them happy and excited about life is one of the greatest gifts we can give.  We often hear people express those years were some of the their greatest. 

And getting them through those years with little or no debt would be the icing on the cake.