Should Your Child Move Out For University? Can You Afford It?
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| There are three things you can count on in life- death, taxes, and the
fact that university tuition will never go down. Soaring tuition fees
today will mean astronomical fees by the time your toddlers are ready for
university. But don’t waste the years of childhood joy fretting about the
future. Do something. |
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| First, whether or not your child lives at home will obviously depend
on where he studies. Secondly, you’ll want to consider the broader meaning
of education: learning how to survive on one’s own, work to pay bills,
budget, cook, and clean will be valuable lessons. Those lessons may or may
not be best applied at the same time as studying. Thirdly, if your child
leans toward fine art studies or linguistics or history or archeology, she
might have the most valuable experience studying abroad. The tuition for
foreign studies can be terrifying, but the price of opting out of one’s
true calling may be worse. Living expenses in many foreign countries may
be economical, offsetting the ridiculous tuition. Then again, in some
countries, it will be much higher than home. Fourthly, while it is often a
parent’s desire to see a child make low risk choices, the reality is
simple: many families can’t afford to even ask this kind of question.
There is simply no money for school, whether or not the child lives at
home, and so the child will have to take out a student loan and go to work
like everyone else. |
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| There will be tough choices all along the way. At sweet sixteen, you
might skip buying your son a car, and save the money for school. Then
again, your son may not be going on to study medicine or law, no matter
how much you want that. He may have better aptitude for building or
mechanics. In that case, the car will help him become independent and make
it easier to find work in areas like landscaping, delivery, and so on,
which will give him valuable experience and contacts. Or maybe your
daughter will be struggling with self-esteem issues and take longer to
finish high school than you would like, costing you unexpected expenses in
therapy and medical treatment. You may want your daughter to study at
home, but by the time she’s eighteen, she may rather move in with her
boyfriend while studying. Whether or not you like it, you may not have a
choice. |
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| When we plan ahead, we have to remember that we don’t always know
exactly what we are planning for. The dream and hope we have for our child
will not play out exactly as we wish. We’ll be spending the next few
decades getting to know our child, as he or she grows into adulthood.
Being flexible and realistic is our very best defense against an unknown
future. Don’t panic if things don’t go exactly as planned- because they
won’t. |
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| That said, a little insurance in the form of savings and a backup plan
will go a long way to easing your mind and making the transition from home
to “out there” smooth for your child. Keep your options open, and
carefully consider the pros and cons of all possibilities. Prepare in
advance and save wisely, but allow for the unexpected. |
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| You don’t have to worry in advance, but do begin planning. How? |
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| You’ll want to take action now, investing in education funds and
keeping your debts minimal. Work hard to stick to a budget that uses less
of your income, not more, and wisely funnel your RRSP rebates into RESPs. |
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| Meet with an RESP expert and discuss strategies for your personal
situation and budget. |
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| Meet with other financial consultants and get a range of advice on
your budget, mortgage and real estate decisions, taxes and so on. |
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| Remember that it’s never too late to start planning. Even if your
affairs are a terrible jumble, decide to face reality. We’re not all
billionaires with flawless accounting records. Decide today to take steps
to sort it all out, and seek help to do so. |
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| Get your children involved in planning. Make it a non-negotiable rule
that they begin working early on, delivering papers or working part time
at the mall. From the early days of allowance through to teenage retail
jobs, see to it that they are in the habit of saving. Even if you are
struggling financially or the paper route doesn’t pay much, keep the habit
of saving a few quarters or toonies. A penny saved is more than a penny
earned. |
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| Consider all of the possibilities ahead of time. Your son may decide,
against your will, that he hates school. Your daughter may decide she
wants a pricey Ph.D. in philosophy, and you won’t find that very
practical. You may not be able to afford for her to move out but she
doesn’t want to be at home. So guess what? The options will include
student loan, her working at the same time as studying, living at Aunt
Pam’s, or all of the above. |
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| Remember that college is a valid choice. Practical learning is often
more beneficial than university studies. Sure, it may seem like many jobs
require twelve degrees before the resume will even be looked at. But trade
jobs are always available, and apprenticeships and co-ops help pay the
tuition bills. |
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| Make use of school guidance offices, from elementary through final
years of high school. Don’t let your kid flounder around, trying to fill
out forms or look for his own aptitudes. Book regular meetings with
guidance counselors to look through catalogues, talk about your child’s
strengths and weaknesses, and to learn what kind of programs and jobs are
out there. |
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| Keep track of scholarship possibilities over the years, so that when
the time comes, you will already know what’s out there. Apply for anything
remotely related. It can’t hurt. |
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| If you have a spare room, consider hosting exchange students. You can
be paid several hundred dollars a month for this experience, which
generally last a few weeks to a few months. Usually, you provide meals and
bring your new charge along on family events. The extra money can be put
aside for future learning experiences, or used to reduce debt. |
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| Remember- it is never too late to get on track. Today is the day to
talk about your plan, and then begin implementing it. |
