Is Post-Secondary Education Worth the Cost?
By: Iris Peña
Career and Income Benefits of Higher Education
An individual with higher education is more likely to earn a higher income throughout their lifetime and enjoy greater career stability. Research also shows that post-secondary education offers some protection against economic downturns. While it doesn’t guarantee security, it often acts as a buffer during challenging times.
Health and Social Benefits of Higher Education
Beyond financial benefits, higher education contributes to shaping critical aspects of life. “When you look at the body of evidence, you can see that having a higher education produces better health outcomes, produces longer lifespans, produces individuals who are more civically engaged,” Peter Lewis, President and CEO of CST, said.
University graduates typically live up to eight years longer compared to those who didn’t finish high school. Although this isn’t universal, graduates are more likely to make healthier lifestyle choices, such as being less likely to smoke. From a social perspective, they are also more involved in their communities and more active in charitable giving.
The Hidden Weight of Student Debt in Canada
The average student debt for a university graduate is about $28,000 for a bachelor’s degree. For community college graduates, the average is closer to $15,000. This debt can heavily impact the start of adult life.
Financial and Mental Health Strain
“I would say that the most concerning trend we’ve seen is that sort of persistently, stubbornly high rate of debt for students who are graduating out of university at the moment,” Lewis explained.
According to the report, high debt levels are tied to multiple concerns, including mental health challenges. The study refers to this as a “bandwidth tax,” which contributes to higher levels of anxiety and depression.
Life Milestones Delayed
Debt also forces many young adults to postpone important milestones.
For instance:
- 29% delay buying a home
- 20% delay starting a business
- 15% delay having children
Anabelle Hsiao, a fourth-year computer science student, says she feels pressure to pursue a higher-paying job because of her financial situation. “Once I graduate, I would need to give a third of my monthly income towards the debt, a third towards my rent, and a third towards my daily costs,” Hsiao said. “Essentially, there would be no savings in the first two years.”
Limited Career Choices
Lewis explains that this pressure is immediate and constant. “There is a certain pressure on them to just go out and get a job today because I’ve got to pay my debt today, and I’ve got to make that choice fast,” Lewis said. “They don’t have the luxury of time to be able to say, how do I really find the career that best suits my passion for what I want to do in life?”
Lewis added that these challenges highlight the importance of parents planning early to help reduce the financial burden on their children.
Saving Early: The Best Defence Against Debt
The report emphasizes that many students graduate with overwhelming debt, which reduces the long-term benefits of their education.
CST recommends that parents prepare by saving early, saving consistently, and staying within a structured savings plan until their child begins school.
Lewis stresses that it’s never too late to start. Even parents who begin saving when their child is 10 or 12 can still benefit from compound growth. Compound growth requires both money and time, and the sooner parents start, the more it works in their favour—rather than against them through debt in the future.
“The key message for me that I try to convey to parents with children of any age is that the best time to start saving is to start saving today. And the best way to do that is with an organization like CST or your own financial advisor,” said Lewis.
RESP Benefits
CST offers a registered education savings plan (RESP) for families. Every contribution—big or small—counts toward reducing future costs.
“Every dollar that you set aside today is a dollar you’re not going to be having to find at some point down the road,” Lewis stated. “None of us know exactly what’s going to happen in the future, but we have certainty that when we put money aside today, that money is going to be there, which will create options, create opportunities.”
What Parents Can Do to Reduce Education Costs
Parents are encouraged to explore organizations like CST, which can help set their child up for a successful future.
Since 1960, CST has helped over 700,000 families save for education. Their mission is to make education savings simple and stress-free through low-risk RESP solutions.
“I like to call it our partnership with parents. We provide an education savings plan, we provide a tailored savings program to help parents set it up and then they don’t have to worry about it,” said Lewis.
CST also assists families in accessing federal government matching grants that can increase savings.
Guidance for Families Who Haven’t Saved
If your teen is heading to post-secondary soon and you haven’t saved, Lewis advises there are still meaningful ways to help.
“Helping your child navigate the process of looking for any available scholarship funding, going through the process of securing their student debt – preferably through government student debt programs, student aid programs, those will still provide benefits,” Lewis said.
Building Awareness in Children
Parents can also support their children in non-financial ways. Lewis encourages parents to talk to their children about savings and make them aware that the family is preparing for their education.
“There’s a power in aligning a child’s expectations around something. Children often will fulfill the expectations that are established for them as they’re growing up,” said Lewis. “If you have a child who’s young, you’re letting them know that you’re setting aside money, not for if they go to higher education, but for when they go to higher education.”
Some families also encourage older children to work part-time and put part of their earnings toward savings programs, such as an RESP. This way, children actively participate in the saving process and feel invested in their future.
Encouraging Exploration
Helping children explore their interests early is one of the most valuable roles parents can play. Talk with them about passions and potential career paths. Although the process may feel overwhelming, encourage them to take small steps toward discovering their options.
“We know the world is changing dramatically right now, and the more that we can prepare our kids to be resilient and able to adapt to whatever comes down the road, the better prepared they will be for lifelong success,” Lewis concluded.