The Elephant in the Room
Are you prepared for graduation day?
Every parent wants their children to have the benefit of a college or university education, and as a same sex couple, I am sure that your partner and yourself want the same thing for your children.
Many of my clients who are same sex couples have recently adopted or are looking at adopting a child (adoption by same sex couples is something my good friend and fellow blogger Lisa Feldstein can assist you with) and like all parents, want their children to benefit from post secondary education. There is no shortage of projections and reports suggesting that in another 10 to 15 years the cost of post secondary education including tuition, books, meals, room and board etc could easily hit $100,000
I have no desire to speculate on what the cost will be 10 to 15 or even 20 years from now, nor do I intend to participate in fear mongering. The truth is nobody knows for sure what the cost will be. What I do know, as I am sure many reading this also know, is that the actions you take today will determine if your child or children will be able to attend college or university when they leave high school, and graduate with minimal or no debt.
The question therefore is ” Are you prepared to commit to a plan today, to save for your children’s education tomorrow?”
If you have made the decision to commit to your children’s graduation here are some useful tools that can help you put your commitment into action:
Take out a Universal Life Insurance Policy for your child – You can deposit money into the policy and the cash values grow tax deferred. Recently one of my clients in his 30’s told me that he withdrew the deposit for his home from a policy that his parents purchased for him when he was a baby.
Contribute to a Registered Education Plan (RESP) – Canadian resident children 17 or younger are eligible for the Canadian Education Savings Grant (CESG). The first $2,500 or your annual RESP contribution qualifies for CESG of $500 which the Canadian government pays into the plan, and this money grows tax deferred along with what you put into the plan. Its free money from the government – take it!
Your child may qualify for the Canada Learning Bond – If your child was born after 2004, you currently earn $37,885 or less and you’re receiving the National Child Benefit Supplement to the Canada Child Tax Benefit, then your child may qualify for the CLB, which will pay $500 for the first year of eligibility into the RESP and $100 per year to a maximum of 15 years. That’s a potential $2,000 into your child’s RESP courtesy of the government. If you qualify, take it!
Take advantage of scholarships– Look into the various scholarships that are offered by various schools and organizations. One of the insurance companies with which I do business offers scholarships every single year in Canada and every single policyholder’s children are eligible to apply
Look at savings as bill you must pay – Instead of using your entire tax refund to go on a vacation, save some of that money for your children’s education. One of my clients paid off his car loan of $380 per month over 10 years ago and he continued to view the extra $380 per month as a must pay bill and the result was he had over $45,000 to deposit on his condo. I am not suggesting that you stop enjoying life, I am suggesting that you start making savings a top priority, so that life will be more enjoyable over the long term
The elephant in the room is failing to plan for tomorrow today
About the Author
Karl Marshall is President of lgbtinsurance.ca (a division of Marmac Financial Services Limited) and specializes in serving the insurance and financial needs of the LGBT Community. On Saturday nights he hosts The Party Mix on G98.7 FM in Toronto. You may reach him at 416-554-0892, www.lgbtinsurance.ca, @insurance4lgbt on Twitter or on Facebook.