RESP Statistics

A knowledgeable and educated public contributes to Canada's ability to meet the innovative and competitive demands of the labour market.The majority (67%) of Canadian parents have educational aspirations for their children that include a university degree. An additional 15% identified CEGEP or college completion, 2% a trade certificate and 9% stated either private, other or an unknown level of postsecondary education as their educational aspiration for their child.

Parents' educational plans for their children varied slightly according to the sex of the child. A slightly larger proportion of male children were expected to go no further than high school relative to female children (8% compared to 5%). At the same time more consideration was given to the trades for male children (3.5%) than for female children (1%*)3. On the other hand, a higher proportion of female children had parents who expressed the hope that they would complete a university degree (71%) than did male children (64%). Parental aspirations were similar for CEGEP/ college completions regardless of the sex of the child.

Parental hopes varied greatly according to parents' own level of educational experience. As parental levels of education increased so too did their educational aspirations for their children. Parents' educational aspirations for their children were also mitigated by the child's age.

Eight in ten children had parents report that their child's grades were 70% or higher in 2002 (14% at 90 or above, 32% between 80 and 89, 36% between 70 and 79). Nine in ten children were perceived by parents to either like school (73%) or were neutral about school (16%) mirroring the overall positive attitudes parents had towards their children's continued education, as discussed earlier. Only 11% of children seemed to dislike school according to parents. Parental school performance expectations were high. The parents of only about half the children (53%) believed that their children were working to their full potential at school.

All public postsecondary institutions – colleges and institutes as well as universities and degree-granting institutions - offer continuing education programs aimed at adults either for general interest or to develop specific job skills. Such programs vary in length from a few days to three years.

Savings behaviours

The proportion of children with savings for postsecondary
increased from 41% to 50% in three years.

Parental beliefs about education linked to saving behaviours.

About half of the children whose parents believed an education after high school was important already had savings put aside for them in 2002. An additional 31% expected to save in the future. Only 19% of children whose parents believed that an education after high school was very important or important had parents who were non-savers. This contrasts with children whose parents believed that an education after high school was only somewhat or not important. In this group 35% had savings set aside for them by parents, while 28% had parents who intended to save in the future. More than a third (37%) of the children from this group had parents who were non-savers.

Parental savings behaviours strongly tied to the child's age.

In general, parents' saving status was similar for male and female children, with one exception. When the educational aspiration for male children was high school completion, about 32% of parents were already saving and about 39% did not have current savings, nor did they plan to save in the future (non-savers). On the other hand, under the same conditions for female children, 26% had parents who were currently saving and 45% had parents who were non-savers.

Children who were performing well in school were more likely to have savings.

The proportion of children with parents who were current savers declined both as the child's grades dropped and as the child's attitudes towards school became more negative. Almost six in ten children whose reported grades were 90% or higher had parents who were already saving for their postsecondary education. This compares to three in ten for children whose grades were below 60%. This pattern is repeated when examining parents' saving status by children's attitudes to school. More than half (52%) of the children who liked school had parents who were current savers, while only 37% of the children who disliked school had parents who were saving.

Savings behaviours vary on a number of demographic and family characteristics.

Parents' savings status varied across provinces. Saskatchewan and Manitoba had the highest proportion of children whose parents were current savers (59% and 56%, relative to 50% for Canada overall). Quebec had the lowest proportion of children with parents who were saving (40%), perhaps related to the relatively lower costs of attending CEGEP schools in Quebec. Prince Edward Island was also below the Canadian average in proportion of current savers (45%), and had the highest proportion of non-savers (24%) outside of Quebec.
Higher income groups had the highest share of current savers. Almost 7 in ten children (68%) living in households with incomes of $85,000 or more were currently being saved for at the time of the survey. This dropped steadily as income levels decreased. Nevertheless, more than a quarter (26%) of children living in households where the household income was less than $25,000 had parents who were current savers. And almost half the children in this lowest income group (45%) had parents who intended to start saving in the future.
With income levels tied closely to levels of educational attainment it is not surprising to find that children in households where at least one parent was university educated had the highest proportion of parents who were currently saving (63%). However, 37% of children whose parents had only a high school education also had savings already set aside for them.

The number of parents working seemed to matter more to the ability to save than whether the child was from a single parent or a two parent family. Children in two parent families where both parents were working were the most likely to have savings set aside (58%). Children from two parent families with only one parent working, and single parent working families, were below the Canadian average of parents who were current savers, at 47% and 41% respectively. Children between the ages of 0 and 18 in non-standard living arrangements (parent(s) not working or older children living on their own) were well below the Canadian average in proportion with parents who were saving (30%).About 80% of children aged 0 to 18 had parents who were either already saving or were intending to start saving in the future.

There were considerable levels of anticpated use of financial resources outside the family as well. About a third of this 13 to 18 year old group (29%) was expected to receive grants or bursaries based on financial need. Four in ten children were expected to receive scholarships or awards based on academic performance. Government student loans were expected to be used by 30% of 13-18 year olds who continued on to postsecondary and about 11% were expected to take out repayable loans from financial institutions or family and friends.

Post-secondary Education Participation Survey, 2002 (PEPS)

Survey of Approaches to Educational Planning (SAEP) 2002

Results from the Post-secondary Education Participation Survey, 2002 (PEPS), allow one to see how reasonable these parental financing expectations may be. PEPS asked full-time postsecondary students aged 18 to 24 to provide information on what sources they were using to fund their current academic year. Just over three-quarters of the PEPS population had worked before starting postsecondary and were using savings from past earnings to fund their current studies. About two-thirds (64%) were, in fact, working during their current academic year. Just over one-quarter of PEPS (26%) had received a government student loan for the current year. These figures were very close to Survey of Approaches to Educational Planning (SAEP) 2002 figures for each of these funding sources, although it must be remembered that SAEP looks at financing strategies over an entire problem of postsecondary studies while PEPS looks at strategies used for a current academic year only. The use of particular financial resources may vary across the postsecondary program years. (Figure 3 below).

The financing strategies used by PEPS respondents to fund their current academic year were substantially differant from those expected to be used by children in SAEP in three important areas. Only 15% of PEPS respondents had received grants or bursaries based on financial need (or about half of the 29% figure in SAEP). About the same proportion of PEPS respondents had received scholarships or awards based on academic performance, compared to the expected 40% in SAEP. The only identified financing strategy that had a lower expected usage in SAEP than was being experienced by current students in PEPS, was in the area of repayable loans from family, friends or financial institutions (11% and 27% respectively).

Not surprisingly, children whose parents had identified high school as the educational goal for their children had the lowest median dollars saved to date at $2,990. Median savings were highest when the parental educational hopes for the child included a university degree at $4,960. Interesting patterns were evident in the other savings preferences according to educational aspirations. About 93% of children expected to complete high school only had savings outside of RESPs, while about 76% of those expected to complete university had savings outside of RESPs. On the other hand, only 26% of children expected to complete high school had RESP savings, while 58% of those expected to complete university had RESP savings.

Household income was linked to the amount of money saved to date by current savers, the savings strategies used, and the contributions to savings made in 2001. Children in households where the income was less than $25,000 had a median amount of $2,400 saved to date by 2002. This almost tripled for the highest income group where the median amount saved to date was $7,000. A much higher proportion of children living in high income households had parents who were using RESP plans to save, (61%) relative to children living in low income households (42%). The median amount contributed in 2001 was almost three times higher for households in the highest income bracket relative to those in the lowest income bracket. Parent savers in households with incomes of less than $25,000 made a median contribution of $590 in 2001, while those living in households with $85,000 or more in income contributed about $1,400.

Amounts expected to have saved for postsecondary education

As noted earlier, income was related to both the likelyhood that parents intended to save any money for their children's education and whether or not they were currently saving. It is not surprising, therefore, that income was also related to the amount that parents expected to have saved by the time their children became eligible for postsecondary enrolment.

Figure 4 (below) compares several distibrutions describing how much money parents who were currently saving expected to save for their children's postsecondary education. Each of the five differant lines represents a differant group of household income. Although the majority of the values Iindicated by the high peaks) were between $5000 and $25,000, the distributions indicate a great deal of variability in the expectations of parents.

For all income groups except the two highest, parents were most likely to expect around $10,000 in educational savings. Using education costs estimated from the Post-secondary Education Participation Survey, 2002 (PEPS), this equates to approximately 1 year of postsecondary education. However, very few parents in the lowest income category expected to save more than this amount. The steepness of the single peak for this group indicates that the parents in the lowest income group tended to be very similar in their expectations of savings.

Not surprisingly, as household income increased, parents expected to save increasingly higher amounts. While parents of children in the next two income groups ($25,000-$64,999) also tended to be concentrated around $10,000, about one in four children had parents who expected to save around $20,000, or the equivalent of two years of postsecondary education.
However, the differences in savings expectations were not proportional to the increases in income across the three lowest income groups. Although the maximum household income level shifted by $40,000 for these three income groups, parents were still most likely to expect around $10,000 in savings. Few parents in any of the three lowest household income groups expected to save more than around $20,000.
Children from the two highest income groups also had many parents expecting savings around $10,000. Nonetheless, the most likely savings for children living at the higher income levels was around $20,000.
There was a greater tendency for parents of children living at the highest income level to expect savings around $30,000. However, even at the highest income level, parents of two-thirds of the children still expected to save less than $30,000. It appears that parents who were saving, even those at the highest income levels, did not expect to save much more than the equivalent of two years of postsecondary costs.

Interestingly, in each of the five income groups, there was a noticeable percentage of parents who expected to save around $50,000. The percentage ranged from approximately 2% to 7% between income groups and, except for the two highest income groups, was larger than the percentage expecting to save around $40,000. The presence of this small sub-population implies that, regardless of income, there are some parents who expect to have sufficient savings to pay for the equivalent of at least an undergraduate university degree.

The Above is a Summary of a Statistics Canada Report:
"A Survey of Approaches to Educational Planning (SAEP) 2002".

"Statistics Canada information is used with the permission of the Minister of Industry, as Minister responsible for Statistics Canada.
Information on the availability of the wide range of data from Statistics Canada can be obtained from Statistics Canada's Regional Offices,
its World Wide Web site at http://www.statcan.ca and its toll free access number 1-800-263-1136."
http://www.statcan.gc.ca

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