Education Savings Plan Canada | RESP Guide for Parents

Building Futures, One Property at a Time: Investing in Real Estate for Your Child’s Education Journey.

From the early days of diapers and formula to the whirlwind of extracurricular activities, kids’ expenses seem to sneak up faster than we can say “university tuition.” And oh, that looming giant of a cost when they’re finally ready for higher education it’s enough to make any parent take a deep breath.

The Reality of Ballooning Education Costs

If you thought music lessons were a financial hurdle, brace yourself for the eye-watering reality of today’s university tuition costs, which soared past $7,000 per year nationwide in 2024. According to an RBC study, the current cost of a one-year university, including residence and miscellaneous expenses, is a whopping $17,359/year.

For our little ones still mastering the art of tying their shoelaces, we will be looking at a six-figure price tag by the time they finally toss their graduation caps. According to Statistics Canada, the total cost of a four-year degree for a child born in 2021 and starting university in 2039 is approximately $131,768, including living in residence!

Sending our kids into the world of student debt at 18 isn’t the dream scenario. We’ve all heard the tales of graduates wrestling with colossal repayments well into their 30s; surely that can’t be the only path?

RESPs vs. Education Investment Plan: What’s the Right Solution?

Enter the million-dollar question "How do ordinary families balance supporting their kids’ dreams and safeguarding their finances when tuition costs skyrocket, and average incomes struggle to keep pace?" Hoping for scholarships or an unexpected inheritance can feel like a gamble. But one strategic education savings plan has quietly built wealth for generations: rental properties.

While traditional investment accounts may have their limitations, investing in rental properties opens the door to a world where your money can grow with the market. It’s not just about reliable cash flow from rent checks; it’s also about leveraging appreciation to accelerate your education fund growth.

Even in slower markets, properties generally appreciate by about 3-5% annually in the long run. That compounds dramatically over the 15+ years before your little one heads to post-secondary school. Appreciation helps rental investors in two ways: forced savings as you pay down mortgage principal, and growing equity as property values rise.

This means your asset and education investment plan can grow consistently, allowing you to cash out at a profit down the road. With wise timing, selling or refinancing your appreciated rental property to fund tuition can yield a windfall that simply would not have been possible if you’d saved the same monthly amount in an RESP.

Appreciation also provides a buffer against inflation eroding the value of cash savings, because it’s a hard asset; your property value rises along with inflation. RESPs can’t provide this.

To maximize time and compounding to supercharge your education investment plan, consider tapping into real estate’s appreciation upside. With an upfront investment now, you can make your child’s future goals the beneficiary and set them up for success, no matter what path they choose.

Let’s talk if you’re unsure if the upfront investment needed for this strategy will work for you. You might be surprised to find that the appreciation in your current home has already enabled you to create an education savings plan that will get you further ahead.

Book a 30-minute strategy call, and let’s talk about a plan.

The financial reality of raising children in Canada touches almost every aspect of a family’s mortgage and housing decisions, from the size of home you need to the timeline you are working with to the income strain that comes with parental leave and childcare costs.

Colin is a father who has lived this firsthand, and he brings that perspective to every conversation with clients who are planning for a growing family. A mortgage that fits your life today needs to be structured to flex with where your family is going next.

Colin Ballantyne is a Mortgage Agent Level 2

Licenced with BRX Mortgage (FSRAO Licence 13463, Licence ID M22000539), serving clients across Oakville, Burlington, Milton, Mississauga, and Ontario-wide. Please feel free to book a time in his calendar that works for you.