How to Balance Debt and Helping a Child Pay For SchoolJul 31, 2018
The positive and negative impacts that post-secondary education holds for children are well-documented, but as a parent dealing with debt, when is it appropriate to say no to paying tuition?
Some of our Licensed Insolvency Trustees (LIT’s) came together to discuss in our podcast this topic and more, including:
- How parents can support a University or #CollegeBound child.
- What parents should know about student lines-of-credit and bank loans.
- Steps parents can take to help make sure their child is financially ready for university.
As a parent, what do you need to know about dealing with your own consumer debt and supporting a child’s post-secondary aspirations?
It starts with an open and honest line of communication about your own financial situation with your child. Don’t set yourself up for failure by committing to something you can’t afford. Being transparent and honest about your inability to contribute financially; with debt levels reaching new highs, it’s not uncommon for parents to have to say no to paying tuition. That doesn’t mean you can’t help them in other ways:
- Help them research and apply for available grants and scholarship including OSAP, which has recently begun to give full grants on the provincial portion of the student loans.
- Allow them to live at home if they are attending a post-secondary school nearby. That can help save them thousands of dollars a year.
- Be open and supportive during their time in school and encourage them to work part-time during the school year to help reduce their debt load.
Also, being honest with yourself about your debt situation is an important part of the process. If your debt load is overwhelming and affecting your ability to financially support your child’s education, or other financial goals, there are debt options available to help you leave your debt behind. The freedom you’ll gain from taking action to reduce your own debt will provide you with the ability to save more and potentially contribute to your child’s education later or as they enter the workforce.
Make sure to listen to our podcast for even more tips and advice on how you can balance your debt load responsibilities and your child’s post-secondary education.