Saving for your children's education requires a long-term plan. And, like saving for retirement, the earlier you start your plan the better. Use this calculator to help develop or fine tune your education savings plan.

Age of children

Current age of your children. This calculator is based on each child beginning their college education at age 18. The difference between their current age and 18 is the number of years you have to save.

Annual tuition and books

Current estimated cost of one year of tuition and books. This amount should be per child and be specific to the school they may be interested in attending. For the purposes of this calculator all expenses are assumed to be due at the end of the year.

Living expenses

Current estimated cost of one year living expenses. Like tuition and books, this amount should be per child and specific to the school they may be interested in attending. For the purposes of this calculator all expenses are assumed to be due at the end of the year.

Education cost inflation

This is the percentage that you expect educational costs to increase per year.

Current savings

The total amount you currently have saved for your child's (or children's) education.

Monthly contribution

The amount you plan to save per month toward your child's (or children's) education. This calculator assumes that all contributions are made at the beginning of each month.

Registered Education Savings Plan (RESP)

Check this box if you wish to calculate your savings with a Registered Education Savings Plan (RESP). There are two advantages to using an RESP to save for your children's education. First, the money grows tax free until the child needs it for tuition, residence and other educational expenses. Second, you receive a Canada Education Savings Grant worth as much as $600 per year per child. The grant amounts are calculated as follows:

Income Range	Annual Grant Calculated As
$0 - $37,885*	$0.40 for each $1 for the first $500. $0.20 for each $1 for the next $1500. Maximum annual grant is $600
$37,886* - $75,769*	$0.30 for each $1 for the first $500. $0.20 for each $1 until you reach the maximum grant. Maximum annual grant is $550
over $75769*	$0.20 for each $1 for the first $2500. Maximum annual grant is $500

*These amounts are adjusted annually for inflation. For additional information you can visit http://www.hrsdc.gc.ca/en/learning/education_savings/public/cesg.shtml

Please note that for the purposes of this calculator, taxation is not factored into the results. This calculator assumes that 1/12 of your annual RESP grant is added to your savings each month along with your normal contribution.

You are limited to a total of $50,000 in contributions to an RESP per child, but there is no annual limit. You may contribute the entire $50,000 contribution in one year if you have the means or a windfall. Lifetime grants to an RESP are limited to $7200 per child. The grant amount you receive does not reduce your contribution limit to an RESP. For more information on RESPs please see: http://www.hrsdc.gc.ca/en/hip/lld/cesg/publicsection/glossary.shtml

Rate of return

The annual percentage rate you expect to earn on your educational savings. The actual rate of return is largely dependent on the type of investments you select. For example, for the last thirty years the average annual rate of return for the TSX is about 10%. Savings accounts at a bank or credit union may pay as little as 2% or less. It is important to remember that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. You may wish to use a more conservative rate of return if your child is within 10 years of enrolling in school. This calculator compounds all growth annually. For the purposes of this calculator taxation is not factored into the results. If you pay taxes on the interest, dividends or capital gains from these investments you may wish to enter your after tax rate of return.