CIBC Poll: Canadian parents willing to pay for two-thirds of their children's post-secondary education costs
Investing early and minimizing fees key to growing a long term education fund; CIBC Investor's Edge waives account admin fees to help parents get a head start
TORONTO, Aug. 27, 2013 /CNW/ - A new CIBC (TSX: CM) (NYSE: CM) poll shows that Canadian parents, on average, are willing to pay for two-thirds of their children's post-secondary education costs. However, 30 per cent of these parents do not have a plan to cover the tab for their kids' schooling which will likely cost them tens of thousands of dollars.
Key findings of the poll include:
- On average, Canadian parents with children under 25 said they are willing to pay for 66 per cent of their children's education costs
- However, within this average there is a wide range of intentions among parents:
- 21 per cent say they will pay for the entire cost of their children's education costs
- 39 per cent say they will cover at least half
- Only 6 per cent say they won't fund any of the cost
"It's clear that parents have the best of intentions to help their children get an education and support them financially in doing so," said Marybeth Jordan, Managing Director and Head, CIBC Investor Services Inc. "However, with the significant cost of a post-secondary education, parents need to start saving early to help their education investments grow over time."
Many parents not confronting the cost realities of post-secondary education
The survey also found that nearly a third of parents (30 per cent) did not know if they would be helping to pay for their children's post-secondary education, a finding that concerns Ms. Jordan.
"If you haven't taken the time to think about how much you are going to put towards your children's education, you may be less likely to take action, and that can make it more challenging later to come up with the money," says Ms. Jordan. "The earlier you make the decision to start saving, the easier it will be to make regular contributions each month."
Regionally, parents in Quebec were willing to cover among the highest percentage of their children's education costs (75 per cent) compared to the national average of 66 per cent, while parents in BC said they would only cover 58 per cent of the costs, on average.
Among Canadian parents surveyed with children under the age of 25, the following represents the amount of education they have paid for or are planning to pay for by region:
Contributing to an RESP and minimizing fees keys to success
Ms. Jordan stresses the importance of managing contributions to the plan while minimizing fees in order for parents to reach their goals.
"To help ease the financial burden for parents financing a child's education, CIBC Investor's Edge is the first major Canadian bank-owned online brokerage to remove administration fees from all self-directed RESP accounts", says Ms. Jordan. "This gives self-directed investors an opportunity to start small and build their portfolio as their children grow, without paying annual fees that can have a real impact on returns in the early years of the plan."
Under the new RESP account offer there are no minimum balance requirements for CIBC Investor's Edge clients to qualify for the fee waiver. All current RESP clients will be automatically enrolled in the offer, and new clients can open a no-fee RESP account by calling CIBC Investor's Edge today. Additionally, clients can qualify for CIBC Investor's Edge Loyalty Pricing of $6.95 per equity trade with a household member1 maintaining a $100,000 balance in CIBC accounts or products2.
Results are based on a CIBC poll conducted online by Leger, which surveyed 1,000 Canadians with children under 25. The associated margin of error for a probabilistic sample of the same size is +/-3.1%, 19 times out of 20. Polling was conducted between June 9 and 12, 2013.
1 Household is defined as clients living at the same address.
2 Accounts and balances held with President's Choice Financial are not eligible for Loyalty Pricing.
CIBC Investor's Edge provides its clients with exceptional service, support and value. Clients benefit from online and telephone access to their accounts, and can trade on-the-go with the CIBC Mobile Brokerage App. CIBC Investor's Edge offers clients a wide range of accounts and investments, including stocks, ETFs, fixed income instruments, options, GICs and over 2,000 mutual funds, as well as online planning tools, and robust research and education resources.
CIBC is a leading North American financial institution with nearly 11 million personal banking and business clients. CIBC offers a full range of products and services through its comprehensive electronic banking network, branches and offices across Canada, and has offices in the United States and around the world. You can find other news releases and information about CIBC in our Press Centre on our corporate website at www.cibc.com.
SOURCE CIBCFor further information:
Kevin Dove, Head of External Communications, CIBC, 416-980-8835, firstname.lastname@example.org