With Albertans focusing on retirement savings, paying down debt, and saving for vacations, the important goal of saving for a child or grandchild’s education is often overlooked, according to a recent study by Edmonton-based ATB Financial.
The quarterly survey revealed that only 19% of Albertans are saving for a child or grandchild’s education and only half believe they’ll be able to save enough to cover the total education expense.
Furthermore, only 10% of Albertans are saving for their own education, with half of current students or recent graduates relying on student loans or lines of credit to cover education costs.
“Albertans may want to consider education savings a priority early on to avoid saddling their children with an enormous amount of debt when they graduate,” says Chris Turchansky, president of ATB Investor Services, in a statement. “By starting a savings plan early, even before their child begins elementary school, parents can reduce the burden of debt to pay for higher education.”
Almost half of participants expect a four-year degree, while living away from home, to cost between $50,000 and $90,000. More than half of participants expect to incur $20,000 to $35,000 in student debt.
Other findings in the study include:
- Fewer Albertans are halting regular contributions to their savings and investments (34%) compared to last quarter (28%)
- Among participants who save for education, the most common way to do was is via RESPs followed by TFSAs
- Unstable markets have led to a 5% decline in optimism toward investing, especially within the stock market
The ATB Investor Beat survey was conducted by Ipsos from April 23 to May 3 and involved 1,002 participants.