Q: I’m thinking about going back to school. Our kids are almost done elementary school and my husband faced a critical illness a few years ago. If he were to get ill again and I were to be the sole breadwinner for our family, I have no idea how we’d survive. But school is expensive; the tuition alone for the program I’m looking at is around $13,500. That’s more than we can afford right now. Have you got any tips about how we can finance my education? ~Emily
A: I’m glad that your husband is well again. An illness in the family and the sense that your stability may be in jeopardy is unsettling. It is wise of you to plan for a worst-case scenario while hoping for the best.
Investing in yourself and your family’s wellbeing is always worth it; however, up-front costs can make it feel almost impossible to go back to school. It can be easy to focus on the cost of a program but be realistic about all of the costs as you consider your options, e.g. books, supplies, transportation, decreased earnings and extra child care/activities. Before you go back to school, test drive your budget by living on the revised version to see what it will be like. By trying it out ahead of time you’ll either be better prepared for the changes you’ll face, or you’ll have enough time to come up with an alternate plan.
If you discover that you need specific prerequisites, check into free upgrading courses through your local school district. Many school districts offer courses at no charge for graduated or mature students. If the courses you need aren’t available through the school district, you may need to take adult education courses at a public post-secondary institution. There you will need to pay tuition but some upgrading courses might be available at a reduced rate.
If you already have credentials, experience or a degree, consider upgrading your education in a related field, rather than starting over. With a busy family life, saving time and money is valuable. Some post-secondary programs will give you credit for past education and/or experience. Adding to your education also allows you to draw on your experiences and take advantage of what interests you, which will make going back to school easier.
If you’re currently working in a field you’d rather not pursue further, don’t discount it entirely. Your knowledge is transferable and could provide you with opportunities for a blended new career that you didn’t know existed!
Financial Mistakes to Avoid at University
3. Benefits through your employer
Many employers offer some benefits to help with the costs of going back to school. Check into your extended benefits package or talk to your HR department to see if you have benefits available and/or if you qualify for them. While some employers will stipulate that courses must be related to your work, others won’t.
4. You may not need all of the money up front
Depending on what you want to go back to school for, some programs won’t require full payment up front, and even for those that do, payment arrangements might be possible. As you consider how you want to further your education, look at when payments are due. Contact the financial aid and awards department at the institutions to see what help they can provide. Options for mature students are often slightly different than for students fresh out of high school.
5. Scholarships and bursaries – non-repayable funds
Apply for any and all scholarships and bursaries/grants that you even remotely qualify for. Many go unclaimed each year because no one applied for the money. Funding is important for all students, not just first–year students, and many mature students don’t realize that they too can apply for awards. This is money you do not have to repay at the end of your studies, so it’s well worth investing the time to apply.
Student loans, regardless of the source, with few exceptions must be repaid. There are two types of student loans: government (provincial and federal) and private (funding from elsewhere, e.g. your financial institution). If you qualify for government student loans, they do not require payments while you’re in school and when it comes to repayment, the term can be 10 years or more and the interest is tax deductible.
Student loans or lines of credit through your bank or credit union typically require interest-only payments while you’re in school, and to qualify, you may need a co-signer or collateral. Repayment terms tend to be stricter and interest is not tax deductible.
To find out more about student loans, visit your post-secondary institution of choice. They will be able to give you the most up-to-date information. They will also be able to give you information about loans that do not need to be repaid. There are a limited number of arrangements where working in the field can reduce your loan amount, and these change based on demand and economic factors. If you are a student with a disability, there may be some special considerations available to you as well.
If you have savings in a tax-free savings account (TFSA) or registered retirement savings plan (RRSP), you may want to consider using some of the money to help pay for your education. The Lifelong Learning Plan (LLP) allows you to withdraw money from your RRSP to finance full-time training or education for yourself or your spouse.
When withdrawing money from long-term savings, consider all of your options and any requirements for/conditions of repayment carefully. While your intention might be to replace the funds once you complete your education, even the best-laid plans can run into problems that don’t allow you to fulfil your goals.
If you have parents with some means, and if they are planning to leave you a legacy by way of an inheritance, could they afford to part with some of the money now when you need it (without jeopardizing their own ne and wellbeing)? Estate planning conversations can be tricky, so you might want to start by being candid about your plans. Finding a way to help you support yourself and your kids, should something happen to your spouse, is likely something your parents have already thought about. If you’re not sure how to start the conversation, show them this article. It will hopefully open the door and make it easier.
When looking at the financial hurdle of going back to school, the long-term benefits of furthering your education might feel like the distant light at the end of the tunnel. However, beyond the financial benefits are the psychological and emotional. Knowing that you are able to provide for your family and your children’s future is powerful. Furthermore, anecdotal evidence from parents who go back to school while their kids are still in school suggests that grades tend to increase when everyone is doing homework. Within your bigger goals, I would encourage you to plan in short-term increments. It will make heading back to class feel less ominous, and more doable.
How to Pay for University Without Getting Into Major Debt
Scott Hannah is president of the Credit Counselling Society, a non-profit organization. For more information about managing your money or debt, contact Scott by email, check www.nomoredebts.org or call 1-888-527-8999.