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By Jeff Suderman
Paying for college or university isn’t typically
considered an exciting topic of discussion around the dinner table, yet it
is a critical one most families will have to deal with more than once in
their lifetime, as one in two high school graduates will pursue post
secondary education soon after graduation. 1
Education is a purchase which differs from most you
have made in your lifetime. As children, we are taught to put our quarters
in our savings jar, until we have enough to buy our desired item. As
prudent as this is, this line of thinking poses a problem when it comes
saving the $63,000 we may need to pay for university or college education.
Education is a unique investment which requires you to
shift your financing perspective. Instead of picturing your educational
funds as a jar that needs to be full, imagine it is a pie which needs to be
sliced several ways. Each piece of the pie represents a different funding
source; some of these sources will rely on your savings jar; but a
surprising amount come from other places. For example, one funding source
is your personal savings. Others include your parents’ or
grandparents’ contribution, student aid available from the college or
university, student loans, Registered Educational Savings Plans (RESPs),
etc. By using a wide variety of resources, the costs of education are
slowly met. So what are some of the resources available?
The first place to look for free resources is at the
institution you are applying to. Most universities will discount their
tuition through the use of various academic, participation (fine arts,
athletics) or need-based awards. It is in your best interest to apply for
these awards – as they are free for the taking and are there to
assist you in affording the cost of attending that institution.
Institutional awards can range anywhere from $50 all the way up to the full
cost of tuition, depending on the level of need, academic ability,
leadership ability or performance abilitY that you have. Apply as early as
you can; and be aware of any deadlines – especially the closing
dates.
Another resource you can use, to find scholarships and
grants to assist with the cost of post secondary education, is the web.
Many websites are available (www.studentawards.com) which offer a multitude
of awards, depending upon a wide range of criteria the applicant must meet.
They are not usually affiliated with a specific post secondary institution,
but are more often supported by businesses, banks and other organizations
which contribute funds towards these awards. You need to be discerning
regarding which websites you use as resources, since some sites are used to
discover email addresses for spamming purposes.
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Most post-secondary institutions will list legitimate
outside scholarship website links on their own website, to save you some
time in determining which websites are worth researching and which are not.
Keep in mind that this process will take time and effort, since many
applications require essays and sometimes even references. It will take you
some time to wade through the various awards available, to determine if you
are even eligible.
Provincial and federal student loans are also
available through the province in which you are a resident. An excellent
resource for loans and other financial information is www.canlearn.ca.
Besides the formal government loan program, it is not uncommon for parents
or students to take out small personal loans to cover some of the costs of
education. Another option is to borrow from Registered Retirement Savings
Plans (RRSPs) to cover educational costs; this opportunity was recently
introduced by the government, and is similar to the use of RRSP monies to
purchase a home.
There are some who question the wisdom of taking out
loans for education. Make careful considerations before using loans, but
realize there are times when the long term investment makes short term
borrowing a good decision. For example, most people are willing to take out
loans for the purpose of purchasing a home. For many, education is a
similar long term investment – which provides stronger future
employment possibilities and returns; the important thing is to ensure you
have set limits to how much borrowing is responsible, based upon your own
personal circumstances.
Finally, since you are the primary beneficiary of
receiving a post secondary education, your personal resources should be
looked at as a primary source to fund the cost. Most governments and
institutions expect you to look to your own resources first in paying for
post secondary education. You should work hard during summers and use
employment income, savings and any investments that you have – or
your parents have started for you – to pay for schooling.
Post-secondary education is far more than just a rite
of passage. The skills that are acquired during these four years will net
considerable returns on your investment in both salary and breadth of job
opportunities. University graduates earn $1 million more over their
lifetime than those who have not completed any post-secondary education. 2
The investment we make in education pays itself off
many times over. As Christians, we know that learning is far more than just
a good financial decision. It is a way to honour our Creator, as we seek to
develop and use the unique gifts he has equipped us with.
1 Statistics Canada
2 2004-2005 Guide to University Costs in Canada. USC
Education Savings Plans Inc., 2004. www.usc.ca
Options Fall 2008
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