Education costs: strategies for better planning

Don’t let the dream of a degree become a source of anxiety: instead, turn it into a springboard to the future! How? By anticipating the costs of your children’s education and implementing a sound savings strategy starting now. This will save you a lot of surprises when you see them take this important step as young adults.

However, you still need to know how much to set aside, even before you know your children’s future choices.

In this article:

• Why plan early for post-secondary education
• Estimate how much to save for education
• The tangible benefits of education savings
• Other sources of financing to consider
• A financial strategy tailored to your family
• FAQ on financial planning for post-secondary education

When you consider the cost of post-secondary education, saving as early as possible remains the best way to ensure you don’t lose your shirt—or your child’s ambition—along the way.   

How time strengthens your savings 

In savings, time is your best ally. Investing sooner rather than later and contributing regularly—even if the amounts are small—will help you generate returns over the long term, as well as take advantage of available government education savings grants as soon as possible. 

Anticipate uncertainty 

While you don’t yet know what the future holds, several factors can guide your savings strategy. Down the road, when your child develops an interest in a particular field, you can simply revise your goal in anticipation of the type of studies (vocational, college or university) needed to pursue their career plans.  

Reduce financial pressure  

Spreading a savings goal over 15 years will be much gentler on your family finances than trying to reach it in just 5 years, for example. Moreover, just the act of saving can reduce your financial stress. Knowing that money won’t be an obstacle to your child’s ambitions is priceless!

It’s difficult—if not impossible!—to predict the choices your baby will make when they reach age 17. So, when you start planning for their education, you need to look at other considerations, such as the following:  

• Just by growing up in an environment where education is valued (for example, if you yourself have a post-secondary education), your child is more likely to see you as a role model and choose the same path. 
• According to the probabilities established by the Ministère de l’Éducation and the Ministère de l’Enseignement supérieur, nearly one in two Quebec students¹ are likely to obtain a bachelor’s degree, and two out of three¹ are likely to obtain a CEGEP—whether in a pre-university or technical program. 
• Due to inflation, the anticipated cost of post-secondary education will be different in 5, 10 or 15 years—in other words, when your child should be on the point of taking that step in their educational journey. 
• If you live in a remote area, your child may have to move away for school, which will considerably increase your budget. 

The tangible benefits of education savings

When it comes to education savings, it’s important to know that parents are not alone. Governments also help finance post-secondary education by offering generous grants to families who contribute to a Registered Education Savings Plan (commonly known as an RESP).  

Government grants available  

This financial assistance can represent up to $12,800³ per child in Quebec. Now that’s a breath of fresh air for your savings goals! These grants are obtained in the form of a bonus on your investment: the Canada Education Savings Grant (CESG) adds at least 20% on your contributions, while the Quebec Education Savings Incentive (QESI) adds at least 10%. Depending on your situation or family income, this percentage could be as high as 60%⁴ if you qualify for the additional CESG and additional QESI.  

The Canada Learning Bond (CLB) can add up to $2,000 to your RESP, and you may not even need to contribute if your family is financially eligible. 

When the time comes, other financing options may complement the RESP for your child’s post-secondary education, such as loans and bursaries from student financial assistance, scholarships offered by various organizations and institutions, and money earned from a student job. These levers will lighten the overall bill and spread out the financial effort.  

On the other hand, certain strategies help to better control costs:  

• Choosing the right program or facility. 
• Implementing rigorous budget management. 
• Optimizing student lifestyle expenses. 

Together, these approaches will help make the educational savings goals more accessible, while limiting debt. 

Every family is unique, which is why it’s important to implement a savings strategy that’s aligned with your income and your reality. By taking into account your financial capacity and the number of children you have, you can adjust your contributions in a balanced and progressive way. This will allow you to make the most of the incentives available and support your children in their future plans, without compromising your family budget.  

University, technical programs, vocational training, trade schools: any path can lead to a successful career. And while the price of education can be daunting, it’s good to remember that education is still the surest way to get rich. Education should not be seen as a debt or an expense, but as an investment in your child’s future!