Have you considered a private school education for your children? If so, you are part of a nation-wide trend. In nearly every province, private school enrollment is on the rise. Over the past few years, private school enrollment in Canada has risen by almost 17% while public school enrollment has decreased by 8%.
While you’re debating whether or not to send your kids to a private school, here are a few things you should know – especially when it comes to saving for their private school education. Know the cost The cost of private school varies based on factors like the type of school and program. Boarding programs, where tuition covers room and board, are the most expensive.
According to the Council of Ministers of Education, Canada (CMEC), private school tuition and boarding fees range from $30,000 to $60,000 per year, with schools in large cities at the higher end of the price range. Generally, faith-based schools have the lowest fees and you’ll also likely pay less while your child is in the lower grades.
Keep in mind that tuition can increase annually and doesn’t always include such necessities as laptops, books, transportation, lunches and uniforms.
Many private schools offer programs to ease the financial burden, and be sure to find out if your child is eligible for a merit-based scholarship or a needs-based bursary. If you enroll more than one child, the school may offer a discount.
Know how to pay for it The best way to pay private school tuition is to plan ahead and save. A Tax-Free Savings Account (TFSA) is an excellent choice since any income earned isn’t taxed and there are no withdrawal restrictions – you can take out as much as you need, at any time, without tax or repayment requirements. But to make the most of it, you must start early, even while your child is in diapers, and contribute the yearly maximum amount – that way, you’ll have much longer to save and get the biggest benefit from compound growth. It’s good to know you can also use financial gifts from family members – perhaps that wedding gift from your
grandparents – as TFSA contributions.
There are plenty of options when it comes to selecting a TFSA investment type, including cash, mutual funds, individual securities, guaranteed investment certificates (GICs), bonds and even certain shares of small business corporations. So, to make sure you get the most from your TFSA investments and other savings options – whether they are for your kids’ private school education or for achieving your other financial and life goals – the first place to start is with a
tutorial from your professional advisor.
This column, written and published by Investors Group Financial Services Inc.(in Québec - a Financial Services Firm), presents general information only and is not a solicitation to buy or sell any investments. Contact your own advisor for specific advice about your circumstances. For more information on this topic please contact your Investors Group Consultant. Insurance products and services are distributed by I.G. Insurance Services Inc. (in Québec - a Financial Services Firm). Insurance licence sponsored by The Great-West Life Assurance Company outside of Québec.