Saving for college without breaking the bank
According to the Bank of Montreal, the cost of university or college education for a child born in 2011 will rise to as much as $140,000. That’s quite a bit of money, especially if you have more than one child.
There are many reasons you may feel the crunch when it comes to putting away money for the education of your child; however, like any savings or investments, it’s important to pay yourself (or your children) first.
Some of the ways that you can easily build the investment in your child’s future include:
Opening a Registered Education savings account can be done as soon as your child receives their social insurance number, available right after birth.
Beginning contributions to this account as soon after birth as possible increases the principal and compound interest, increasing the amount that is going to be available for the education of your child. Start early and get ahead.
Apply for education grants
There are multiple grants and programs that are available for Canadian parents. These grants will deposit up to five hundred dollars into every RESP that is opened for your child through a recognized institution, often automatically once it has been opened.
Anniversary deposits are also made into the account by the government, to boost the savings potential.
Use preauthorized transactions
Contacting a representative at your financial institution and setting up preauthorized debits from the account to the education fund means that the transactions are going to be debited automatically.
Every month, the amount will be transferred into the investment fund for your child. This is what we do, and is one less thing we have to worry about every month.
Make small sacrifices
Would you give up something small in your lifestyle for the sake of your child’s education?
Could you live without that daily latte? Could you give up the expensive movie channel package or even a couple of bagged lunches each week? Making these small changes can help to find the money in the budget to contribute to an education fund.
Skip the toys, go for the trust
Grandparents especially are known to spoil their grandchildren. Rather than buying a toy every month or so, it might be a good idea to explain that this money would be better spent on an education fund for your child. Grandparents can contribute annually, monthly, or with a one-time contribution.
Saving for your child’s future doesn’t have to be hard. Simply cut out a few indulgences in your life and put your extra cash away.
By following the tips above, you are sure to see a major increase in the amount of money you are able to set aside.