Studying Abroad and Financing - The Parent Dimension

Thinking about your child’s future and financing their college or university education?  You’re probably automatically wondering how expensive is it going to be and whether you can afford it.
 
Can you relate to any of the scenarios below?

1.     We would like our child/children to study abroad but we do not have 
        any money put away for them to study. 
 
2.     We were able to finance one child’s study abroad but we are not sure 
        we would be able to finance the other child or children 
 
3.     We have an educational fund but the money is not enough to fully 
        cover our child’s education
 
4.      The programme my child wants to study is not offered locally but I am 
         not sure I can afford sending them abroad. 

In an ideal world, parents would have secured enough savings to finance the higher education studies of their children.  We would have saved diligently, without fail, to ensure we can adequately meet all costs when the time comes. However, for many parents this is often not the case; in fact, most persons usually start considering financing options very close to the time college/university preparation begins. 
 
Parents often find themselves being pulled by various emotions: often caught between wanting to fulfil the dreams of their children and wanting to make financially sound decisions.  Despite the challenges, many parents are finding creative ways to finance education.
 
Over the years, I have observed a variety of financing options that are considered for financing higher education. Here are some of the options being utilised, which often comprise a combination of sources:

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1.  Financing the first year out of pocket and then financing via a loan from
     the bank/credit union or a Government student loan to fund the
     remaining years.

2.  Acquiring a line of credit to cover the first year’s expenses, while making
     repayments during the year of study to help finance some of the second
     and/or third year expenses. This is usually combined with financing
     certain expenses out of pocket or a loan.

3.  Having a loan to cover tuition costs while funding all personal expenses
​     out of pocket or via a line of credit.

The financing option selected is often based on the study pathway being pursued. The pathway selected would determine how much financing is required. For example, persons may opt for a college to university transfer pathway, where the first two or three years are spent in a college level program before transferring into a degree program for the final one or two years. This pathway is becoming increasingly popular due to the cost-saving factor.  Two or three-year college programs typically cost less than a four-year degree program.  Additionally, this financing and study pathway is determined by other factors such as study destination, program of choice and academic qualifications etc. 
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Therefore, it is equally important that parents work to help their child figure out their study interests, possible career goals/dreams and what pathways are available to make achievable.
 
 
Written By
Sheena Alleyne M.A
Lead College and University Advisor
The Student Centre