Student Loans and Education Financing updated 2013

1.  What student loan options do I have?

There are 2 main government student loan options (National and Provincial) and there are Education Loans from Financial Institutions like Credit Unions and banks.

2.  Which is best for me?

 I would recommend starting with the Provincial and National student loan programs.  You apply for both on the same application.  With these government student loans you do not pay or accumulate interest while you are going to school, there are some payment relief programs in place after graduation, and the interest paid on government student loans is tax deductible.  There are also some scholarships or grants that may decrease what you owe for government student loans.

More information can be found at http://alis.alberta.ca/ec/fo/pay/loans-grants.html

3.  So why would I use a credit union or bank education loan?  

Money Lessons My Kids Taught Me

My family reserves one night a week for just us.  We try not to book anything else so that we can do an activity together, like swimming, playing board games, and sometimes holding a family council.

This past week I was taught an important lesson concerning how to teach my kids. It came in 2 parts.

Part 1:  For our family night my wife and I decided to help teach our children about budgeting and saving money.  We went through a brief discussion about separating their allowance (based on chores done properly) into spending, savings, and long-term savings.  We used lots of examples of things they could save for that would take a few months to do (iPod Touch, horse riding lessons...).  We tried to emphasize that by saving some of the spending money they would achieve their goals more quickly. We then decorated 3 boxes for each child, giving them a place to store their money as they saved it for the 3 different purposes.  I though it went pretty well, until we were starting to clean up and the 3 oldest immediately asked if they could go to 7-11 to buy a slush.  It was a "slap my forehead in frustration" moment.

Kids Learn about $ from Parents

I've written articles about teaching youth about finances before.  I wrote about using games like Monopoly or the Game of Life to teach youth about budgets and incomes.

Rocky Credit Union goes into schools (those that let us in) to teach a class about needs vs. wants, online banking, debit cards, credit cards, and student loans.  In these classes I often ask the students "How do you learn about controlling your money?"   The usual response is from parents, friends or their job.  A few students have responded that they don't ask their parents because they are always in debt and can't teach them anything about handling money, and a few others have said they really haven't learned anything about money from anyone.  This is scary considering most of these students are grade 10 or 11 and half of them already have part time jobs.

There are 2 key things parents do to teach kids about money:  1. Teach by example, and 2. Talk to kids about money.