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How are you going to cover tuition?

By Annette Bourdeau

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Think you can't afford private school? You may want to look again. Canadian independent schools are becoming increasingly accessible as more of them beef up their financial aid and scholarship programs in an effort to attract the best and brightest, regardless of financial background.

Chantal Kenny, executive director of admission at Toronto-based boys' school Upper Canada College (UCC), urges families to investigate what's possible before ruling out private school altogether. "A lot of families simply assume it's out of their reach, but in fact schools such as ours do offer wonderful financial aid," she says.

Financial assistance has changed over the past 10 years, according to Kathy LaBranche, director of admissions at Trinity College School (TCS) in Port Hope, Ont. "It's becoming more and more important," she says.

In fact, TCS offers $2.2 million in financial assistance each year. Moreover, Kenny says that UCC expects to quadruple its assistance over the next five years, so that the percentage of UCC students receiving some form of financial aid will jump from six per cent to 20 per cent.

"The movies would have you believe private school is just for the elite, but the face is changing," LaBranche says.

Making independent schools more accessible is a win-win scenario for all students, even those who aren't on the receiving end of financial support. "Diversity enriches campus life in countless ways," says Graham Brown, administrative director at Dwight International School in Shawnigan Lake, B.C. "You're bringing in students who are really motivated, and a lot of diversity is useful in the classroom."

If you think independent school is right for you but you're not sure if you can afford it, consult these tips from financial experts and the schools themselves to help you navigate the process and find ways to save on tuition. After all, as LaBranche puts it, "It's your kid's education. You can't not look."

1. Make no assumptions. "Don't close the door before you start to look because you decide you can't afford it," LaBranche says. Even if you think your income is too high to qualify for financial assistance, it doesn't hurt to investigate what's available. Large established schools most likely have more financial aid options than smaller and newer ones. Schools often offer several scholarships, and families may be restricted to applying only to one. Scholarships tend to be merit-based, not needs-based. The criteria can range from broad requirements, such as outstanding academic performance, to quite granular specifications. For instance, some schools offer scholarships for a student from a single-parent home, a student from the Cayman Islands, a student from Saskatchewan or a student with exceptional arts skills. Bursaries are the most common form of needs-based financial assistance. They can range from partial relief to a full ride.

2. Shop around. "Don't get discouraged if the first school you call has a really high tuition rate," says Michael Thomas, director of the Fraser Institute's Children First financial assistance program, which is no longer accepting applications in its final year of operation. In some cases, tuition can be fully funded by the government or other sources and cost nothing, or it can be as high as tens of thousands of dollars a year. You may be able to find an independent school that meets your criteria that costs a fraction of what the first school you looked into does.

3. Consider the extras you'll save money on. Many private schools include services and benefits in the cost of tuition, such as extracurricular fees, meals and tutoring. "Think, ‘If my kid were here, what costs wouldn't I have?'" LaBranche says. For instance, you could save as much as $8,000 a year on hockey-related expenses since programs like sports are included in many independent school packages. LaBranche says other potential savings lie in gas expenses, as well as food and living expenses for boarding students. "It's a big ‘aha' moment for a lot of parents," she says.

4. Remember to budget for fees. "Make sure you have money set aside for extras," Thomas says. "There may be things like transportation costs and uniform fees that you wouldn't have to deal with at a public school."

5. Start researching about bursaries or scholarships as soon as possible. Many schools have a bursary application fee of up to $65, so find out first if your child has a good chance of receiving aid by visiting websites or calling schools.

6. Apply for financial assistance early. Most schools have a rolling deadline, but as with anything, it's best to apply sooner rather than later since the application process can sometimes be lengthy. While entrance scholarships don't require a formal application, awards targeting academic ability, artistic or athletic skill, and community service achievements often do. "We've had students I would have liked to have taken on, but we had already used up our allotment," says Brown, who advises getting applications to Dwight in before April 1.

7. Be prepared to lay all your cards on the table. "People get stressed and embarrassed when talking about finances," LaBranche says. "Put your pride aside and be open and honest." Applying for financial aid won't affect your child's chances of being accepted to private school since acceptance is based on whether the student is a fit and meets the school's academic and extracurricular criteria.

The application process can be taxing, as you will likely be asked to provide income statements, tax forms and lists of assets. Make sure to mention any special circumstances that aren't reflected on your basic income statement, Brown recommends.

8. Ask if the school will accommodate a flexible payment plan. "Most schools do offer payment plans," Thomas says. "It doesn't hurt to ask. All they can say is no."

Dr. Howard Bernstein, psychologist and executive director of the Chisholm Centre, which offers special education services, says its school in Oakville, Ont., accommodates flexible payment plans when it can and has even allowed parents to spread out payments for two years of school over a four-year period. "We find different ways to help," he says.

9. Investigate multiple-child discounts. "Many schools do have a family rate, and that can shave off hundreds of dollars a year," Thomas says. This is particularly common at faith-based schools, where discounts can start at 10 per cent off the tuition for each sibling. Multiple-child discounts vary at each school but are often applied to the third sibling who enrols.

10. Inquire about tax breaks and insurance coverage. The Canada Revenue Agency has a long-standing policy of allowing a certain portion of amounts paid to attend certain private schools to be available as a charitable donation. The schools must be registered as Canadian charities that provide religious education, says Jennifer Horner, senior tax manager at BDO Canada LLP. The school must determine the amount and issue a donation receipt.

If your child has special needs, you may qualify for a medical tax break on tuition at eligible schools with specialized staff. Bernstein says many extended insurance plans will also cover initial psychological assessments at specialized schools like Chisholm, which can cost about $1,750.

Moreover, a portion of the fees can be an eligible child-care expense for private schools that offer programs for preschool-age children or after-school care for students up to age 15, including boarding schools, Horner says. The schools will usually determine this cost. The Income Tax Act imposes a limit of $100 per week for child care at a boarding school for children aged seven or older, or $175 per week for younger children. If the child is disabled, parents can obtain more generous support.

11. Lean on grandparents or other relatives if possible. "We see a lot more grandparents involved," LaBranche says. Thomas agrees that support from relatives is increasingly common. "Often a grandparent will say, 'Let us take care of the tuition, and you take care of the other expenses,'" Thomas says.

12. Explore potential resources in your community. Do your research by asking around and checking the Yellow Pages and other listings. "There are many other organizations that may offer scholarships, like sports groups, community groups and religious groups," says Nancy Edmison, a certified financial planner with the Investors Group in Mississauga, Ont. "Explore all of your avenues. It can be really worthwhile to look."

Brown of Dwight International School says it's not uncommon for small communities to help pay to send local students to private school, particularly if their own educational options are limited. Brown has also seen students receive support from fundraisers organized by groups like the Rotary Club.

Another example is the Prosser Charitable Foundation's Parent's Choice Bursary, which supports 50 per cent of tuition costs up to $3,500 per year for each student from a low-income family to attend a private or independent school not funded by any regional school board in the Calgary area. Families can begin to apply in January 2012 through their qualifying independent school for available bursaries for the 2012–2013 school year.

13. Research government support. "We urge families to find out if there's additional support for families in their situation, such as single-parent homes or immigrants," Thomas says. "Things always change at the government level, so check into it."

Some programs to investigate are the Newcomer Settlement Program for new immigrants, the Ontario Child Benefit for low-income families, the Canada Child Tax Benefit for families with children under 18 years of age, and the Child Care Expenses Deduction.

The Nova Scotia Department of Education offers tuition support funding for students with special needs in a special-education private school such as Landmark East School. Students who have been approved for funding may also be eligible for a tuition support supplement grant.

14. Ask lots of questions. Be upfront about your financial situation, and ask the school for recommendations on how to afford it. Sometimes creative solutions are available. "The amount of goodwill I've seen among schools is remarkable," Thomas says. For instance, he has heard of a school allowing a father to work night shifts as a custodian as a way to earn extra money to finance his child's tuition and gain access to a staff discount.

"One should always ask about ways to make it work. Schools are always looking for strong students," Brown says. "We're all educators. We want to help students."

As Bernstein advises, "If you don't ask, you won't get anything."

15. Prioritize your expenses. "Families have ways of reducing their cost of living so they can put more income toward tuition," Thomas says. "For instance, I have known of families that have moved in with grandparents."

While that may be an extreme example, there are other ways to trim your budget to prioritize education. "What might you be willing to give up or postpone? Retirement? Family vacations? Newer vehicles?" asks Ryan Challis, a certified financial planner at Winnipeg-based Nakamun Financial Solutions. Sacrificing extras like vacations, cable or a family cottage may be tough at times, so Challis recommends making a list of all the reasons you want to send your child to private school. "Keep that list as a working document to refer back to in the years to come," he says. "There will be times throughout the child's school life when the parents question their decision to sacrifice things to send them there. Keep in mind the end goal for the child."

16. Start saving early. Edmison says the Tax-Free Savings Account (TFSA) is a great tool to accumulate savings on a tax-free basis for private school. If both parents max out their $5,000 TFSA contributions each year beginning when their child is born, by the time the child is six years old, they will have $60,000 in their private education fund. Having that kind of capital can help parents snag tuition discounts at some schools that shave off as much as 10 per cent for families that pay the entire year's tuition up front rather than in instalments.

17. Automate parallel university savings through vehicles such as life insurance. With so much energy dedicated to funding private school, it can be easy to forget about saving for university at the same time. Edmison recommends taking out a life insurance policy for your child when he or she is very young, and including an investment component. For instance, if you can spare $100 per month, you could hypothetically put about $30 toward permanent insurance, while the other $70 can be automatically invested. "You can then transfer the ownership of the insurance to the child when he turns 18, and he can make withdrawals to pay for university," Edmison says. As an added bonus, your child is insurable even if he or she develops a health problem down the road.

18. Apply for corporate scholarships and enter contests. Contact the human resources department of your employer to see if any corporate-sponsored scholarships are offered. While many corporate scholarships are intended for post-secondary schools, some companies offer scholarships for K–12 private school. For instance, the Investors Group has teamed up with the Knights of Columbus in Mississauga to sponsor an essay contest called Leaders of Tomorrow, with a private school scholarship as the prize.

—With files from Shaundra Selvaggi, Janice Bradbeer and Caroline Maga

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