Different ways to fund your child’s post-secondary education

Different ways to fund your child’s post-secondary education

Preparing to send you son or daughter to college or university is an exciting time – it can also be costly. The rising cost of post-secondary education means, your son or daughter could graduate with a big chunk of student debt without adequate financial planning years in advance. Thankfully there are ways to fund your child’s education besides debt to give him or her a brighter future. Let’s take a look at some of the best ways.


The RESP, short for Registered Education Savings Plan, is  specifically designed to save towards your son or daughter’s post-secondary education. The main benefit of RESPs is the 20 per cent government grant. By contributing $2,500 every year to an RESP, your child could be entitled to receive the full $500 Canada Education Savings Grant (CESG) from the federal government.
Don’t get RESPs confused with RRSPs (Registered Retirement Savings Plans). Unlike an RRSP, you don’t get a tax deduction for contributing to your child’s RESP, although when your son or daughter withdraws the money for the purposes of funding his or her post-secondary education, it’s taxed in his or her hands at a lower tax rate.To ensure your child has enough money, you’ll want the funds you invest in for your child’s RESP to grow. By investing in funds like the Heritage Plan, you can help ensure your son or daughter has a brighter future.

Money that your child doesn’t have to repay
Even with a well-funded RESP, due to the rising cost of post-secondary education, it may not be enough. That’s where money that your child doesn’t have to repay comes in handy. While your child can always take out a student loan, debt needs to be repaid – this money doesn’t. Keep your eyes out for scholarships, grants and bursaries. The federal and provincial governments, as well as private organizations offer them.
Here are some ways besides debt for your adult child to finance their education.
ScholarshipsContrary to popular belief, you don’t have to be a straight A student to qualify for a scholarship. There are scholarships for students from all different walks of life. Scholarships not only reward academic achievement, they also reward perseverance. Scholarships are offered by all sorts of organizations (your company may even offer a scholarship).

Keep your eyes open for scholarships during the school year, not just around the fall. They’re typically offered throughout the year.
When applying for a student loan from the government, your adult child is automatically considered for government grants. Similar to scholarships, government grants are offered based on academic achievement, financial need and athletic performance.
Bursaries offer students financial assistance by taking both their academic achievement and financial need into account. Many colleges and universities offer students bursaries. They often have tight deadlines, so be sure your son or daughter applies by the deadline, otherwise he or she could miss out on free money.
Student loans
As a last resort, your son or daughter can take out a student loan to pay for his or her post-secondary education. With a student loan, your son or daughter most likely won’t have to start repaying the money until after graduation. There’s also often a grace period upon graduation until the student loan needs to be repaid. This hopefully gives your adult child enough  time to land a decent full-time job. The terms of student loans vary by province, so be sure to go over the fine print with your child to make sure you both understand how interest is accrued and the other important terms and conditions.
*Originally published November 13, 2017