How to Help Your Grandkid’s Debt by Being a LandlordAug 15, 2018
Though university is in the rear-view mirror, grandparents can have a lot to offer in how their grandkids experience post-secondary school. Often, there’s a desire to help financially — to help their grandkids avoid student debt and get a head start in their career. If this is difficult due to tightening budgets, though, helping can also be as easy as opening your front door.
How room and board might be of better use
According to a Maclean’s study from April of this year, the average cost of post-secondary education in Canada is just shy of $20,000 a year. This includes everything — from tuition to food on campus, travelling home to extracurriculars. What might be surprising is that 40 per cent of this $20,000 alone is spent on rent.
It’s really that simple: when university students have a cheap-to-free place to live, they reduce debt and have an easier time affording school. The Maclean’s survey also found that student debt increases by year of study, with those in their fifth year or higher holding an average of $28,858.
This is where grandparents can step in. If you live in a different city than your grandkid and their immediate family, you can offer a school in your area as an opportunity. This especially goes for any graduate studies program.
Just by offering up room and board, grandparents can save their grandkids $8,000 a year. This money can go back toward existing student debt, into a savings account, or toward a first apartment or home. It opens up opportunities for your grandkid’s career and is a really efficient way for grandparents to help students in Canada get out of debt quicker.
Want to learn more about helping financially during the back to school season? Listen to this BDO podcast, which includes advice from BDO Licensed Insolvency Trustees (LITs) for both parents and grandparents.