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The Children Are Our Future

OTTAWA - A new report contains a sticker shock warning for parents of newborns. By the time their babies are heading off to university in 18 years, the cost of a four-year degree will be in the six figures.

The study estimates the total price tag of an undergraduate degree at a whopping $137,013 for students living away from home and $101,426 for those staying at home.

The inflation-adjusted projections, released yesterday by the TD Bank Financial Group, represent a substantial increase over the $77,132 that a degree costs in today's dollars for students living away from home, and $51,763 for those remaining at home.

The report argues, however, the dollars promise to be money well spent, considering the higher earnings enjoyed by those with a bachelor's degree.

The 2006 census shows, for example, individuals with a bachelor's degree had median annual earnings of $56,048, or almost $19,000 more than the $37,403 for individuals with only a high school diploma.

The study also cites a recent report by the C.D. Howe Institute that found investing in an undergraduate degree provided male and female students with an annual rate of return in after-tax earnings of 11.4 and 14.1 per cent respectively.

Higher education also heightens the probability of finding jobs, reduces the odds of unemployment or at least tempers the duration of joblessness if unemployment happens, the report said.

The study estimates students starting university in 2027 will pay a total of $64,363 for tuition, books and academic fees over the four-year period they are undergrads.

The cost of rent, food, communications and other expenses for students not living at home was put at $72,650.

The calculations were based on an annual inflation-adjusted rate of 2.9% to 3.5% for a basket of goods and services reflecting the spending patterns of students living away from home, and one for those living at home.

The study assumed tuition fees and additional compulsory fees would rise at a rate of 5% over the projected period. It traced the upward pressure on the cost of education to lower university enrolments and a decreased ability of provincial governments to raise revenues to help finance post-secondary education as the Baby Boom generation retires


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