Removing barriers to post-secondary education for children on low income

25 September 2017
Higher education is a valuable opportunity for all Canadians. Not only can it increase income earning potential for many who pursue it, but post-secondary education can also be a route out of poverty for many people living on low incomes. However, the reality is that only 30 per cent of students from the lowest income quintile end up attending post-secondary education. Even among those students with A+ averages, students from low-income families are 10 per cent less likely to attend post-secondary education than higher income students. For many families living on low incomes the financial cost of pursuing higher education is often a barrier.
 
Research has shown that having savings set aside for post-secondary education helps children perceive it to be within their reach. In fact, a person with access to financial assets including education savings, is more likely to graduate from post-secondary education, even if that savings is only $500.
 
This is why education savings tools like the Registered Education Savings Plan (RESP) and the Canada Learning Bond (CLB) are so important, to help families living on low incomes build education savings for their children. This has motivated the not-for-profit agency Family Services of Greater Vancouver (FSGV) to increase the up-take of the RESP in British Columbia.
 
FSGV develops and provides a broad range of quality services that are responsive to diverse community needs. Some of the services they provide include counselling, intensive family support, adoption services, employment services, financial literacy programs, and community education and development services.
 
Mark Letchumanan, Manager of Financial Empowerment at FSGV, explained how increasing RESP up-take helps the families they serve. “We work with vulnerable populations like immigrants, single mothers, people in recovery, and youth raised in care who face challenges that prevent them from accessing further education,” he said. “The process of opening an RESP account can be complicated, especially for a family that encounters extra barriers. We’re working to remove these barriers as much as possible and help families throughout the entire RESP sign up process.”
 
To increase their impact in this area, FSGV partnered with Prosper Canada funded in part by the Government of Canada’s Social Development Partnerships Program as one of five national Financial Empowerment Champions (FECs) through the Financial Empowerment Champions project. Together the FECs have a collective goal to open 8,000 RESP accounts by 2020 and to help meet that goal, FSGV hired Rocio Vasquez as a full-time RESP community support worker. “We’ve never been able to take a one-on-one approach before,” Mark said. “Many of the people we serve know about RESPs, but it can feel like an overwhelming process. It’s important to meet with individuals on a personalized basis to share knowledge and information that helps them to take action and feel positive about their children’s future.” 
 
Rocio thinks of herself as a coach when she works with her clients. “I’m there to educate and empower them to create an action plan so they can go to their bank appointment informed,” Rocio explained. While helping her clients through the RESP registration process, she sometimes draws on her own personal experience growing up in a low-income household. “My family didn’t talk about post-secondary education growing up, so when I received a $500 bursary knowing I had those savings motivated me to go to school,” she said. “I tell my clients that I’ve been in the same situation, so it helps them to know I understand where they are at.” 
 
Opening the RESP account at a financial institution is often one of the largest hurdles families living on low incomes encounter in the set-up process. “We have found that some financial advisors at financial institutions don’t know that it’s not necessary to make a contribution to an RESP account, so we often have to educate them on what can or can’t be done with that account,” Mark said. “This is especially important for families living on a low income who are eligible to receive the Canada Learning Bond once they register for an RESP.” 
 
There are various other barriers that people living on a low income encounter as they go through the process of opening an RESP account. Some of these barriers include lack of proper government identification or SIN numbers, low literacy levels, and life circumstances that are more immediate. 
 
Rocio provides her clients with all the RESP account information from the government so they go into their appointment with the financial advisor informed. “One client said she was so happy I talked to her because she could be confident and advocate for herself in the appointment with the financial advisor.” Rocio said. 
 
FSGV is pursuing other initiatives to educate financial advisors about RESP accounts. They hope to implement a recognition program that awards financial advisors at participating financial institutions who open the most RESPs without any contributions made. 
 
FSGV has also partnered with The City of New Westminster Community Poverty Reduction Initiative to strategize how they can help increase the uptake of RESPs in New Westminster, BC. Together they are meeting with financial institutions to explore how to motivate financial advisors to increase their RESP signups for families on low incomes. 
 
FSGV has found one-on-one support to be the most successful RESP up-take method. From April to June 2017, they helped open 41 RESP accounts compared to no RESP accounts opened from October to December 2016 when they first implemented this approach. “All of the other RESP take-up strategies involve large-scale education, but I think for our population you need a micro strategy,” Mark said. “For individuals to sign up, there needs to be a lot of guidance and support because we’ve found there are so many areas where the process can fall apart.” 
 
“Sometimes the hurdles my clients have to overcome seem insurmountable but I find that follow up calls help keep the process moving forward.,” Rocio said. “I remember a single mom of three who I followed up with and ended up helping her prepare for a bank appointment. Having that personal connection with someone is very effective.”
 
Learn more
 
Family Services of Greater Vancouver is a not for profit agency that works to inspire and support those in their community who need help to reach their full potential. Since 1928, Family Services of Greater Vancouver has been helping families through challenging times.
 
Learn more about opening an RESP account at: