I think most parents would agree that it can be quite daunting to find extra money in our budgets to save for the far-off costs of our kids’ education.
Trying to imagine what our children will want or need so many years into the future is like gazing into a hazy crystal ball: how do we plan for the costs of future education? Ideally, we know the sooner you start saving, the better off your family will be when it comes to higher education. Admittedly, it’s not always easy, but even students say it’s worth it in the long run.
Reality check: hidden costs of future education.
Inflation is tricky to predict and plan for, but we know that the costs of post-secondary education have been rising.
CST Consultants Inc. estimates that to send your child to university for four years by the year 2035, you’ll need about $88,000 in total for tuition at a local or home-based university, and more than $150,000 overall to cover tuition, room and board for a school farther away.
So where does a family on a budget find the extra savings necessary to meet these kinds of education costs and still afford to live a little?
Using all or a combination of the tips and ideas below are ways to save hundreds of dollars each month for your child’s education:
Open an RESP
You’re going to need a good place to put all the money you’re planning to trim from your budget, and the best place to put education savings is a Registered Education Savings Plan or RESP. There are many benefits to using an RESP to save, including the growth of income on a tax-deferred basis, the flexibility to use the savings for a wide spectrum of post-secondary education or training programs, and the access it gives you to government grants for your RESPs.
Low-cost ideas for holiday fun
Parenting shifts your perspective on fun, and in the majority of cases, the simplest, no- and low-cost vacation activities are often the most rich and rewarding for families:
- Explore your options for summer fun in the sun in your own neighbourhood
- Take advantage of long weekends with your kids to find opportunities to enjoy low-cost, high-impact cultural and artistic events around town
- Find ways to travel on a budget with your kids over Spring Break
- Save money while funding a month-long adventure to an exotic destination
DIY for bigger savings
Brushing up on your DIY skills can save you money on special occasions without sacrificing the fun:
- Make your own Valentines, Halloween costumes, and homemade presents for your loved ones
- Save money on birthday parties with DIY decorations, loot bags and cakes
- Tackle large-scale events like home renovations with lower-cost, DIY approaches that make room for growing families and their savings goals
Trim out the extras
Give your budget a good clean by sweeping out any unnecessary expenses on your everyday activities:
- Trim your grocery bill with savvy shopping strategies
- Get the whole family involved in packing and eating healthy, homemade lunches versus pricier pre-made and take out meals
- Explore your options for affordable extracurricular activities to keep your kids active and engaged
Indulge in occasional avocado toast
While some sacrifice and discipline is certainly required to be able to save money and live a full family life, a little well-deserved spending on self-care now and again won’t break the bank. It’s always worth noting that taking time for yourself, within your budget, is a key part of real parenting success.
Overall, with a balanced approach to budgeting you’ll be gaining great peace of mind from knowing the saving you’re doing now will give your kids the financial freedom to pursue post-secondary education if they choose it, while also spreading the cost of that education across many years of savings versus one big expense down the road.
Ultimately, building a realistic budget that accounts for wise spending and saving are key parts to creating and living a rich family life.