Financing 101

By Jaclyn Law

SMART SAVING
Stash the savings from your part-time and summer jobs in higher interest accounts and investments. For example, CIBC offers a Bonus
Savings account that currently pays 3% interest on balances of $5,000 or more—instead of the skimpy 0.1% you get from their other savings account. There is a $5 fee to transfer or withdraw money, but no cost for deposits. Park your cash and don’t touch it until you’re headed to school!

GICs (Guaranteed Investment Certificates) are also a smart, risk-free way to save. You invest a sum of money for a specific period of time—ranging from 30 days to five years, depending on the product. At the end of the term, you get your money back, plus interest! Talk to a personal banker for more info on these and other options.

If you still have a couple of years before you go to college or university, talk to your parents about a Registered Education Savings Plan (RESP). Since 1998, the government of Canada has paid 20% of the first $2,000 in contributions made into an RESP each year on behalf of a child. This grant is called a Canada Education Savings Grant (CESG). For more info, visit www.hrsdc.gc.ca (click “Youth and Students” then “Registered Education Savings Plan”).

Vervegirl Tip: CIBC Everyday Chequing Account with Advantage for Students Benefits: Students get 50% off transaction fees and the monthly fee is waived if they maintain a minimum monthly balance of $1,000. *Maclean’s, Sept. 11th 2006

**Never, ever use credit cards to finance your education! Compound interest is not something you want to deal with on top of borrowed funds

SCHOLARSHIPS AND BURSARIES
The best thing about scholarships and bursaries is that you don’t have to pay them back! Be sure to check with the schools and academic programs you’re interested in to find out what they offer, and refer to our RESOURCES for websites that will show you hundreds more. And keep an eye on deadlines! You will likely have to do some legwork for applications—such as writing essays and obtaining reference letters and transcripts of your grades—so don’t wait until the last minute.

Vervegirl has compiled some of the major programs:
Canada Millennium Scholarship Foundation
www.millenniumscholarships.ca
Created by the federal government, the Foundation provides bursaries, awards and scholarships to improve access to Canadian post-secondary education and reduce student debt. Since 1998, it has distributed more than $1.6 billion to more than half a million students. It administers these scholarships: Millennium Bursary Program, Millennium Excellence Award Program, and World Petroleum Congresses Millennium Scholarship Program.

Canadian Merit Scholarship Foundation National Awards
www.cmsf.ca
CMSF is Canada’s largest independent granting; organization of awards for post-secondary undergraduate study; granting up to 35 awards each year—each worth up to $75,000 over four years. It supports students who combine academic excellence with strong leadership potential, entrepreneurial skill and a commitment to community service. Read about this and other awards at the CMSF website.

RBC Royal Bank
Financial Lifeskills Scholarships
These are awarded to students in any stream, pursuing studies in any field. Applicants require a minimum grade average of 65% and acceptance into a Canadian college or university (CEGEP in Quebec) for full-time study in the Fall/Winter session. Ten awards of $2,006 will be distributed. For info on this and other RBC scholarships, visit www.rbc.com/community/resources/scholarships/index.html. Check with other financial institutions to see what they offer.

Toyota Earth Day Scholarship Program
www.earthday.ca/scholarship
Who’s eligible? Young Canadians who demonstrate outstanding commitment and service to environmental issues via volunteer activities in their schools and communities. The program is once again offering 15 regional scholarships of $5000 each for environmentally-minded students across Canada. The deadline for applications is January 31, 2007

Black Business Professional Association Scholarships
www.bbpa.org/Scholarships/Scholarships.htm
Each year, the BBPA awards six Harry Jerome Scholarships of $2,000. Plus several other scholarships ranging from $1,000 to $7,000.

Queen Elizabeth II Aiming for the Top Scholarship (Ontario only)
osap.gov.on.ca/eng/not_secure/a4t.htm
These scholarships, worth up to $3,500 per year, recognize Ontario high-school students who have shown academic excellence and have financial need. Students who maintain good grades can receive the scholarship for up to four years.

Brescia College Entrance Scholarships
Brescia College, at the University of Western Ontario in London, is Canada’s only university-level women’s college. Brescia is known for fostering women’s leadership, social justice and interactive learning geared toward female students. In addition to bursaries of up to $2,000 for students who demonstrate financial need, Brescia awards entrance scholarships of up to $3,500 for four years to students with high academic standing. The three women with the highest entrance average receive full academic tuition. For more info about these and other scholarships, visit www.brescia.uwo.ca.

LOAN LOWDOWN
CANADA STUDENT LOANS
Government student loans are awarded based on demonstrated financial need, and you must meet the criteria in order to qualify for assistance. The government pays the interest on your behalf while you’re a student, and recipients must start repaying the loan six months after  completing their studies.

Note: Not available in Québec, the Northwest Territories and Nunavut—which have other government-sponsored student assistance programs. For full details about other government-sponsored education grants, visit www.sdc.gc.ca.

BANK LOANS AND LINES OF CREDIT
Not eligible for government assistance, student loans or a line of credit from a bank? Trust companies and credit unions may be your best option. What is the difference between a loan and a line of credit? When you take out a loan, you must start paying interest on the entire amount borrowed immediately. A credit line is more flexible. The bank gives you a limit, you withdraw only what you need, then pay the monthly interest  on that amount.

Figure out how much money you’ll need each year BEFORE going to the bank. Take into consideration the savings you already have, job income, money from your parents, etc. The bank might require a parent to co-sign for your loan. The amount you can borrow is usually $5,000 to $6,000 per year, up to a maximum of about $20,000.

HAVE YOU THOUGHT OF
Looking for scholarships and bursaries through family, friends or your employer?
Many corporations, professional organizations and unions offer scholarships and bursaries to employees’ kids, so ask your parents to check. Veterans’ groups and community service organizations (such as Kiwanis) also offer scholarships. Many scholarships are designated specifically for female students, students with disabilities and Aboriginal students. What you can get might even influence your choice of program or school.

In 2006, 56 per cent of Canadian undergrads received financial help from their families—approximately $6500 each.  Family contributions are the most common source of educational funding, though tree-quarters of all students rely on a combination of government student loans, scholarships, their own savings and bank loans.  
2006 Canadian Undergraduate Survey Consortium

WORKING IT OUT
Co-op programs, in which students learn while doing unpaid work placements,
have existed for years. But only recently have schools flexed the rules and awarded credit to students for working at paying jobs. Talk to your guidance counselor if staying in school, balancing school and work, or saving for higher education is becoming a major challenge for you.

RESOURCES
Do Your Homework!
Your guidance counselor is a great resource for scholarship info, and can help you find out about opportunities at the schools of your choice.

CanLearn
www.canlearn.ca
This is a very helpful government info hub that helps you save, plan and pay for post-secondary education. Includes a scholarship search tool, education savings calculator and other resources.

ScholarshipsCanada.com
www.scholarshipscanada.com
This excellent online database is crammed with 60,000 scholarships, bursaries and cash awards for post-secondary education from over 300 organizations.

StudentAwards.com
www.studentawards.com
This site offers a scholarship matching tool, plus info about competitions and bursaries.

National Educational Association of Disabled Students (NEADS)
www.neads.ca
Students with any kind of disability should check out the Financial Aid Directory and job matching service on the NEADS website.

Canadian Federation of Students
www.cfsontario.ca
This 25-year-old student union advocates for university and college students. Read about special offers—like discount cards and cell phone plans—that save you money.

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