Canadian Finance Blog

Finish College Without Student Loan Debt

Posted: 30 Aug 2010 02:00 AM PDT

With tuition prices increasing each year, going to college or university can be expensive. This can also be the same time that young adults move out on their own, increasing the costs even more. While getting a student loan can help pay for these expenses, with proper planning and saving money wherever possible, you can get through your higher education without student loan debt.

Canadian Government Programs

The best way to avoid student loan debt is likely with an Registered Education Savings Plan (RESP). Of course this is something that was hopefully set up by your parents, but if not you could set one up for yourself. You can contribute to an RESP up until the age of 21, though the grant money stops the year after the beneficiary turns 17. So if you turned 17 this year, you can make a contribution and get a 20% Canada Education Savings Grant. Even if you missed out on the grant time frame, you could take advantage of the tax free growth, especially if you plan to work for a couple years before going to college.

If you’ve been contributing to an RRSP, another option is to withdraw up to $20,000 under the Lifelong Learning Plan. You do have to pay back this money that you’ve borrowed from your RRSP, but you don’t incur any interest, just the lost opportunity for gains in your RRSP.

Textbooks and School Supplies

You can buy used textbooks through posting on school boards and through sites like craigslist and kijiji. When it comes to saving money on school supplies, take advantage of flyer deals and have a look at Costco and dollar stores for some great prices.

Food Expenses

Reduce your food expense by staying away from restaurants and going to the grocery store instead. Not only is this cheaper, but it is likely healthier as well. Save money on groceries by shopping the weekly sales and buying the store brans as often as possible.

Utility Bills

Check with your providers as they may have special student plans and rates. If previously listed 10 ways each to save money on electricity bills, water bills, heating bills and cable TV bills.

Clothing

While you should try to avoid the expensive name brand clothing, though you can often get some good prices on top brands through outlet stores and warehouse clubs. You can also make your clothes last longer by washing less often, using cold water and hanging your clothes to dry.

By saving in advance and living frugally during school, you can definitely finish college without student loan debt!

This article is part of the Education and Wealth group writing project put together by GoBankingRates.com. You can help Canadian Finance Blog win by voting for #15 in the comments section of the Education and Wealth voting page!

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Monday, August 30, 2010