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A 547% INCREASE?

October 27, 2025

On the Rising Cost of Education

If you’ve eaten fast food recently, you may be surprised by the bill. Thirty years ago, a Big Mac hamburger cost around $2. Today, it is almost four times the price. Over the same period, average family income has risen by 162 percent, while the Consumer Price Index (CPI), the official measure of inflation, increased by 140 percent. Yet, among the items compared below (chart), one cost has far outpaced everything else: university tuition.

With the school year now underway, it is a timely reminder to consider education funding. Ensuring our families have the financial means to support higher education is more important than ever, given the rising costs. An investment program is also a great way for parents, grandparents and other family members to leave a legacy.

Changes in (Nominal) Prices of Select Items: 1987 & 2025¹

Registered Education Savings Plan (RESP) — The most common tool, the RESP offers tax-deferred investment growth, Canada Education Savings Grants (CESGs) of up to $7,200 per beneficiary and potential income splitting when funds are withdrawn and taxed in a beneficiary’s hands.

Formal Trust — Unlike RESPs, there are no contribution limits (RESPs have a $50,000 per beneficiary limit), tax deferral or CESG benefits. However, earnings on trust assets may be taxed in the hands of the trust beneficiary if properly structured so attribution rules do not apply. Be aware that once funds are paid to the beneficiary, they can be used for any purpose, not just education.

Life Insurance — Participating whole life insurance can be structured to accumulate cash value to help cover future education costs. The cash value grows in a tax-advantaged way, and the policy also provides life insurance protection for the beneficiary.

Do You Have a Student in the Family?
If you have a student attending post-secondary school, keeping good records is important to take full advantage of tax benefits. Two tips:

Tuition Tax Credit — This federal non-refundable credit has been reduced to 14 percent of tuition fees (July 2025), with provincial credits available. After applying the tuition credit to their own taxes, any remaining credit can be transferred to one of the following individuals: spouse/partner, parent or grandparent to a maximum of $5,000 less the amount used by the student. Unused amounts can also be carried forward for use by the student in a future year.
Moving Expenses — Certain moving costs may be deductible. For example, if a student attends a post-secondary program at least 40 km from home and returns in the summer for a job, these expenses may be deductible for the student on a tax return.

The information contained herein has been provided for information purposes only. The information has been drawn from sources believed to be reliable. Graphs, charts and other numbers are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual’s objectives and risk tolerance. This does not constitute a recommendation or solicitation to buy or sell securities of any kind. Market conditions may change which may impact the information contained in this document. Wellington-Altus Financial Inc. (Wellington-Altus) is the parent company to Wellington-Altus Private Wealth Inc. (WAPW), Wellington-Altus Private Counsel Inc. (WAPC), Wellington-Altus Insurance Inc. (WAII), Wellington-Altus Group Solutions Inc. (WAGS), and Wellington-Altus USA Inc. Wellington-Altus (WA) does not guarantee the accuracy or completeness of the information contained herein, nor does WA assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Before acting on any of the above, please contact your financial advisor..

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The opinions contained herein are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Wellington-Altus Private Wealth. Assumptions, opinions and information constitute the author’s judgement as of the date this material and subject to change without notice. We do not warrant the completeness or accuracy of this material, and it should not be relied upon as such. Before acting on any recommendation, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Graphs and charts are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual’s objectives and risk tolerance. All third party products and services referred to or advertised in this presentation are sold by the company or organization named. While these products or services may serve as valuable aids to the independent investor, WAPW does not specifically endorse any of these products or services. The third party products and services referred to, or advertised in this presentation, are available as a convenience to its customers only, and WAPW is not liable for any claims, losses or damages however arising out of any purchase or use of third party products or services. All insurance products and services are offered by life licensed advisors of Wellington-Altus. Wellington-Altus Private Wealth Inc. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. All trademarks are the property of their respective owners.