How to Involve Grandparents in the BTS Process: Debt ReliefJul 05, 2018
There is a lot of talk about how student debt can affect students for up to a decade after they graduate, delaying major milestones and causing financial stress. We also know that many students are forced to move home after they graduate so they can reduce their debt in order to move on to the next step. What’s often overlooked is the positive role that grandparents can play in the lives of their post-secondary grandchildren. Their role can give them a good head start towards their future.
Multigenerational support and why it’s important
Raising a child is hard enough and if you’re fortunate enough to have your parents involved in the process, they can offer a lot of help during those early years and beyond. A report from CNBC found that parents save an average of almost $15,000 per year because of the support grandparents’ offer, such as helping with childcare, homework help, transportation and after-school activities.
How grandparents can support their grandchildren in more ways than financial
Since more and more Canadian retirees are taking on debt to assist their adult children or simply combat higher costs of living, their budgets may be stretched. As most demographics are struggling with their own financial issues, it’s important to find ways to involve grandparents in their grandkids’ lives that doesn’t necessarily involve money. Here are some ideas:
- Pass on some financial literacy knowledge. Have your parents speak to your kids about the importance of balancing a budget, saving for a rainy day and setting financial goals. Also, go over topics like the ins and outs of debt relief and why taking on too much student debt or consumer debt now can hinder them in the future. Even better, make it a family financial meeting and involve everyone.
- Offer your post-secondary child a place to stay while they attend school. The GTA is host to many amazing post-secondary schools and living on the outskirts has its benefits. If they’re able, ask your parents if they would consider offering room and board in exchange for basic chores and help around the home. This can drastically decrease the amount they will need to borrow in personal loans or student loans in order to afford housing. Bonus: you’ll know exactly where they are and that they’re being cared for while away.
- RESP Contributions. Instead of traditional gifts during the holidays, birthdays or graduation, recommend they contribute to your grandchildren’s RESP instead. This can allow you to take part in their educational future and help them offset student debt.
When to start the discussion
Your parents want the best for you, just like you want the best for your kids. Involving your parents in your own parenting process can give your kids a valuable perspective based on their years of experience. During summer break, take the time to discuss some of these ideas as a family. If your child is gearing up for post-secondary school in the fall, talk about the possibility of staying with grandparents to cut costs. And, if your children are still young and you’re thinking ahead, consider talking to friends and relatives about gifting a small RESP contribution instead of the traditional gifts during birthdays and holidays, providing they are comfortable with the concept.