Credits: JORDAN THOMPSON/QMI Agency
More than half of Canadian parents have opened a Registered Education Savings Plan (RESP) for their children, a survey by the Bank of Montreal (BMO) has found.
And 70% believe it is best to set up an RESP after a child is born.
"The costs associated with a post-secondary education can be daunting, so it's encouraging to see that a majority of Canadian parents appreciate the importance of planning and saving for post-secondary education," Robert Armstrong, a spokesman with BMO, said in a statement. "Getting a head start on saving by opening an RESP when your child is born will help. A little goes a long way, with compounded return and government grants yielding considerable savings by the time a child's 17 years old."
The study, which was released Saturday, revealed there are still many parents who are not taking advantage of RESPs, with the biggest barriers being a lack of money and awareness. It showed that 60% of parents believe they cannot afford to contribute to an RESP
and 93% are not aware of the range of investments they can hold within an RESP.
Armstrong says parents who find it hard to contribute to an RESP should consider making regular, small payments and encourage relatives and friends to make contributions as part of a child's birthday.
According to recent statistics, a four-year university degree can cost upwards of $60,000. For a child born in 2012, the costs of a four-year university degree could reach $140,000.