The majority of Canadian parents do not take full advantage of opportunities when it comes to saving for their children’s post-secondary education, says a new Ipsos poll conducted for Knowledge First Financial.
The poll found that 56 per cent of parents have not taken advantage of grants available within a Registered Education Savings Plan (RESP), and 31 per cent have not started any saving for their children’s education.
Many have regrets
Two thirds of respondents with children aged 14-22 said they would change how they saved for their children’s education, with 36 per cent saying they would have saved more monthly and 30 per cent saying they would have started saving earlier.
"Education costs are going in one direction; up,” said Lesley-Anne Scorgie, personal finance expert and author. “If parents can make room in their budgets today to start saving for their child's future education, it will lighten the financial load for the entire family when it's time to register the child in a post-secondary program."
Forty per cent of respondents said they would turn to government student loans as an alternative source of funding, 15 per cent said they would turn to loans and credit lines from a bank or credit union, 11 per cent said they would use a home equity line of credit, while 7 per cent would borrow from family or a friend. Twenty-seven per cent said they would not need any additional funding for their children’s education. "No parent wants to see their child carry massive student debt after graduation,” said Scorgie. “I'm a big fan of using RESPs to save in advance because the best part about this tool is the government grants available to parents."
"We've heard from parents over and over again that they wished they started saving sooner or saved more each month. We wanted to conduct this survey to know more and validate what parents were sharing with us," said George Hopkinson, president and CEO, Knowledge First Financial Inc. "We were definitely surprised by the extent of the results. Contributing early and often to an RESP is the best action a parent can take to prepare for the rising cost of post-secondary education."