Rising living costs and education expenses have left many Canadian parents struggling to save, with the cost of a four-year university education projected to exceed $100,000 in 2025.
Embark, Canada’s education savings and planning company, revealed in a new report that 54% of parents feel off-track with general savings, while 49% are falling behind specifically on education savings. Over half graded themselves a “C” or worse for their 2024 savings efforts, with 22% giving themselves an “F.”
Parents reported a $12,880 increase in average household spending in 2024, with groceries, transportation, housing, and debt cited as top financial pressures. These rising costs forced 43% of parents to pause education savings, while 29% used education savings to cover other expenses.
Embark forecasts that the average cost of a four-year university education will reach $101,319 in 2025 and rise to $137,490 by 2042 for children born in 2024. Students in Nova Scotia, New Brunswick, and Ontario are expected to face the highest costs, while those in Newfoundland, British Columbia, and Quebec will see the lowest.
Despite these challenges, nearly half of parents still prioritize education savings over other goals, such as retirement and mortgage payments. Sixty-six percent expressed confidence in meeting their education savings goals by the time their children reach university.
Andrew Lo, CEO of Embark, noted the importance of prioritizing education savings despite financial strain: “With the cost of education exceeding $100,000 in many provinces, parents are doing all they can to ensure their children can prepare for the real world without taking on serious debt.”
Lo emphasized the benefits of government support through RESP grants and called for raising the RESP contribution limit and exploring additional incentives to help families save.
As inflation and rising expenses weigh on Canadian households, long-term planning and systemic support remain crucial for families aiming to manage education costs.
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