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Matt Benoit

Our fictitious student Chuck Brown will begin a bachelor's degree in general arts and sciences at the University of National Averages in 2020. The Globe
and Mail spoke to experts and crunched the numbers to help Chuck plan his annual finances.

Prediction: Tuition will rise faster than inflation, but the rate is difficult to predict.

Back in the 1990s when tuition rose significantly, newspapers predicted it could cost up to $200,000 in a decade. That, of course, didn't turn out to be true. But Chuck should be prepared to pay somewhat more in tuition when he begins university in 2020.

"The main driver of cost increases is tuition. Look down the road at the economic environment: governments are facing this fiscally restrained environment and they don't have the ability to provide as much funding as they have had previously. A large portion of universities' income is coming from tuition." – Francis Wong, economist, TD Economics

"Tuition will increase. The spread between costs in provinces is getting bigger. This reflects part ideology and part ability to pay. Newfoundland is among the cheapest provinces to go to university in, but its budget is based on oil prices at $120 per barrel. If the price of oil significantly declines, that could change. If Europe collapses dramatically or a crash [occurs] in China and B.C. can't sell its wood, maybe there will be big changes. A serious second recession could have impact." – Alex Usher, president, Higher Education Strategy Associates

Prediction: Textbooks are getting better, and that costs more.

"Generally the change from print to digital will make books more expensive. They will be better products with more features, but that will cost more." – Alex Usher

Prediction: Technology costs will rise.

"There is an extra category of costs because of technology. Having a computer is now almost as important as having a calculator used to be." – Elena Jara, director of education,
Credit Canada

Prediction: Nationally, rent will rise at the rate of inflation, but it's the local market that matters  – campus areas aren't cheap.

Between 1993 and 2010, the national average cost to rent a one-bedroom apartment rose by 11 per cent. But a closer look reveals that Chuck ought to pay attention to rental costs in his own local market. For instance, rent in Windsor fell 13 per cent while in Saskatoon it rose 40 per cent. "Where you have a hot housing market, it's going to be high." – Alex Usher

Prediction: Food costs will rise faster than inflation

While the cost of most of Chuck's necessities will rise at the rate of inflation (1.3 per cent annually), the cost of food is expected to increase by 3 per cent a year.

Prediction: Student loans will be more restricted.

"If the economy is not doing well, more graduates will default on their student loans. I can see this leading to more restrictions on student loans. Some students may not qualify. They may have to turn to parents or private sources and borrow at potentially higher rates." – Elena Jara

Prediction: Interest could have an impact.

If Chuck needs a line of credit or credit card, he'll have to make interest payments during his studies.

"Don't take the current interest rate as what you can expect to pay in the future. The prime rate is at a historical low. In a normal economic environment you can expect the rate to rise by two points at the very minimum." – Francis Wong


The bottom line: It is about more than tuition

"You need to look at more than just the headline tuition number when considering costs. Student aid is always vulnerable. Where you're more likely to see costs trickle down is with tax credits. That was suggested as a solution in the Quebec conflict. They proposed to give the students a partial win on tuition then make up the money by rolling back tax credits. Net costs for parents might go up that way." – Alex Usher

The bottom line: Despite weakness in the youth labour market, higher education is still worth it

"Postsecondary education is about much more than the first four or five years after graduation. It's a long-term investment. You need a postsecondary education even to be on a competing level in the labour market. You're not just competing with your peers, you're competing with everyone. You need that competitive edge. If you obtain that education it sets you on a good path for your entire career." – Francis Wong


Current national tuition, compulsory fee averages: StatsCan, 2012
Projected annual growth rate of tuition, books, supplies, food, other: TD Economics 2009 & 2011 and

Housing costs and projected rates: Higher Education Strategy Associates, 2010