Have You Started to Save for University?

A recent survey by TD Canada Trust found that a staggering 45% of parents who have children eligible to start post-secondary education this fall have not started to save. A third of the parent surveyed say they'll only be able to cover less than 10 per cent of the cost. Another TD survey suggests that 58% of post-secondary students feel anxious or stressed when they think about how they're going to finance their education.

Remember that tuition has increased 8% in 2 years and according to a 2010 Statistics Canada report, the average student owes over $18,800. TD states the total cost of school for students living away from home at $80,000.

"If tuition fees and other compulsory fees are adjusted for inflation, Ontario students have witnessed a 244 per cent real tuition fee increase between 1990 and 2011," said the report entitled Under Pressure: The impact of rising tuition fees on Ontario families.

Full Newspaper Story Here

Should you Pick a Small University?

Here’s another report of how students are suffering from poor undergraduate education. Again, we read that the quality of undergraduate education is suffering because of a focus on research. Vice-president Academic of the University of Prince Edward Island, Jim Randall said that doesn't mean undergraduate education is deteriorating. He believes the report is mainly concerned with larger universities.

So is a smaller university a better option? Or more specifically one that is less research oriented and more focused on undergraduate education. One of the advantages of Maclean’s ranking is that there is a separate category for primarily undergraduate universities so you can easily narrow your choices down given this study.

Maybe good things really do come in small packages!

Read the CBC article here.

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Undergraduate Programs the New High Schools?

In Canada, as in the U.S., undergraduate programs have become the new high schools. Elementary and high schools simply have to do more to lay essential educational groundwork.

Once respected classical disciplines such as English, philosophy and history have become so specialized, they often serve no other purpose than to perpetuate the niche specializations of individual professors.

Read more: http://www.thestarphoenix.com/Lament+demise+humanities/5433691/story.html#ixzz1Ycyo48wQ

Unfortunately, I don't see any solution to this issue. As stated more and more faculty members are getting their PhDs in very narrow subject areas and will never be in a position to teach a broad undergraduate course.

Furthermore, will these poorly uneducated students ever learn the basics and thus be able to teach it if they continue in academia? Probably not, unless there is truly a committment to change undergraduate education.

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Women Reaping Higher Return on Investment in University Degree

Canadians with a university degree earn, on average, about 40% more than workers with only high school diplomas. However, this wage premium varies greatly depending on sex and age. Young men with degrees realize much smaller earnings advantages over other young men with lower levels of qualifications than highly education young women do over their less-educated peers.

Are the men aware of this variance? Could this explain why there are more women doing undergraduate degrees?

At University of Toronto, Canada's largest university, the male to female ratio is 44 to 56. Similiar ratios can be found at most Canadian universities. The notable exceptions are: Carleton University and Saint Mary's University both with a 50 to 50 ratio. The Royal Military College has a 78 to 22 male to female ratio (perhaps as expected) and the University of Ontario Institute of Technology reported a 59 to 41 ratio. Another outlier is Mount St. Vincent in Nova Scotia with a 22 to 78 ratio.

In a few years will universities attempt to admit a more gender-balanced incoming class? Only time will tell!

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Financing your University Education

Last week the university tuition fee report was released by Statistics Canada and as expected tuition fees have increased. There was an overall increase of 4.3% in tuition in 2011 following a similar increase in 2010. By comparison, inflation was only 2.7% between July 2010 and July 2011. Will tuition continue to increase at a similar rate? If you or your child will start university in 2012, here’s what you might expect to pay for a four year degree:

·       2012      $5581

·       2013      $5804

·       2014      $6036

·       2015      $6277

Note, however, there are provincial differences. Ontario and New Brunswick have the highest tuition; while Quebec and Newfoundland & Labrador have the lowest. Also, Quebec and Nova Scotia charge higher tuition for out of province students. A third consideration is that some programs, like Bachelor of Commerce and Bachelor of Business Administration degrees have higher tuition than other undergraduate degrees at the same university.

Remember that tuition is only one part of university expenses. You need to include:

·       Textbooks (approximately $1500-2000 per year)

·       Transportation (daily transportation/parking cost if living off campus and/or trips home if off campus)

·       Residence (roughly $5000).Dormitory fees are not correlated to the real estate market the university is located in. Living off campus is sometimes a cheaper option, but I don’t recommend it in first year.

·       Meals (don’t assume that your child who is living at home won’t need money for meals on campus). Meal plans are not what you expect. It’s essentially money that’s deposited upfront that the student can then use at all the various eateries on campus (who sell food at regular prices) and in some cases at local restaurants. It would be helpful if you can and are willing to cook. Note today’s other post about the increase number of Food Banks on college and universities campuses.

·       Entertainment expenses ($1000) but depends on some your entertainment preferences. There are lots of free and cheap fun options on campus.

·       Miscellaneous expenses. My son paid $300 for intramural hockey and $70 for his residence social fee.

I would recommend that you estimate at least $9,500 per year for a student living at home and approximately $17,000 each year for one living on campus or away from home.

So how does one finance a post-secondary education? The most obvious options are:

·       Personal resources from your years of savings. Don’t worry if you haven’t started yet, it’s never too late and every bit helps. Monetary birthday and Christmas gifts from family would be helpful; gently get the word out.

·       Provincial and Canada student loans (see websites to your right). You may be able to get an estimate of the value of the loan you qualify for, if any.

·       Student Line of credit with a bank (see websites on your right). Shop around and read the fine print.

·       Scholarships – Many are offered without an application and are sometimes offered simply as a result of achieving a minimum high school average.  There are also a number which you must submit an application. Do take the time to research the various types of scholarships available, often the number of applications is lower than you expect so apply even if you think that you don’t have a chance. Pay attention to the wording of the scholarship. Some are only offered in first year, while others are renewal automatically or with some conditions. This becomes important when comparing offers from different universities. Your best friend should be the university financial aid officer.

·       Bursaries are usually offered based on financial needs not on academic merit. Generally, you will have to demonstrate financial need by applying for a provincial student loan. Sometimes the application forms are a bit daunting but it’s worth it if you need additional funds. Many students who qualify don’t apply, so often there’s more money than demand.  Again, your best friend is your university’s financial aid officer.

·       Work Study Programs. These programs offer jobs on campus for a certain number of hours to students who have unmet financial needs.  Again, financial need is usually based on your provincial loan application. Many of these jobs are not filled do should consider applying.

·       Be creative; think outside the box of other ways to finance your education. My son had a garage sale and sold items on craigslist and Kijiji.

In summary, a university education is a sound investment in your future. While you need to focus on the cost, you’ll likely need multiple sources of funding to cover the cost. Financial help is available you just need to find and apply for it!

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Location, Location, Location

Some university students living in residence are about to spent their third weekend on campus and some parents are approaching weekend number 3 without their son or daughter at home.

My son is at a university four hours from home and during the research process I wish I knew then what I know now.

Here’s what I know now:

·        Distance is important
During the university research, I felt that away from home is away from home. Distance was less important. I now feel differently. An 8 hour return trip requires more premeditation than a 2 hour drive. My skewed sample of friends show that it’s a lot easy for parents to make to quick, spontaneous trip to campus when the missing-you pain is too great.

·        Nothing replaces in person communication
I believed there were so many fast, free, cheap, efficient ways to communicate (i.e., cell phone, text messaging, BBM, Skype, email, facebook, twitter, etc.) that as a parent there may even be more communication than having a teenager at home. My experience may not be typical, but if you have a student who made a great transition to university finding time to communicate with the parents is not a priority. So much for the BlackBerry upgrade!

·        Nothing can prepare you for this
I could not have been more prepared and I knew I was going to miss him terribly, but it’s much, much harder that words can describe. The drive home after we helped him move in residence was filled with buckets of silent tears.

On the positive side we will see him next weekend! Countdown officially begins today!

Is University in your Future?

Most parents I know really do want their children to go to university and if you’re looking for evidence to support your dream for your child here’s a summary of recently published data:

·       TD economists Craig Alexander and Shahrzad Mobasher Fard College report that 10% is the average rate of return on an undergraduate degree. The range is from 11 – 14%. Furthermore, investment in education remains the single best investment that a person can make.

·       Statistics Canada and the 2006 Census report that university graduates are more employable and spend less time unemployed when they lose their jobs.

·       Organization for Economic Co-Operation and Development (OECD) found more than 80 per cent of university and college graduates between the ages of 25 and 64 are employed, compared to a little more than 50 per cent of high school graduates.

·       The Council of Ontario Universities state that two out of three new jobs require postsecondary education and from 2004 to 2010, employment growth for university graduates outpaced all other levels of education.

·       The Council of Ontario Universities also reported that 93% of Ontario university students find jobs within six months of graduation, but 85% of those employed full-time two years after graduation say their job is related to their education.

·       Ontario university graduates also earn more than twice as much annually (53%) as high school graduates, an average of $1.6 million more over the course of their careers according to the Council of Ontario Universities.

As a high school student reading this I hope you don’t need additional unbiased opinions on the value of a university education.

The underlying assumption of all of these reports is that the students are covering all of their university education (now or repaying loans later). However, as a parent who just paid her son’s first year tuition I’m still waiting for the data which shows the parents’ return on their investment! But I guess my reward is that I’m doing my best to ensure that he will be a contributing member of society.