Previous calculations of the polarizabilities of the nucleon within the framework of heavy baryon chiral perturbation theory have included the contribution of the Δ(1232) only in its effects on various contact terms or have been performed in chiral SU(3) where systematic errors are difficult to control. Herein, we perform a corresponding calculation in chiral SU(2) wherein Δ(1232) is treated as an explicit degree of freedom and the expansion is taken to third order in soft momenta, the pion mass, and the quantity MΔ-MN, collectively denoted ε. We present the results of a systematic O(ε3) calculation of forward Compton scattering off the nucleon, extract the electric polarizability α̅ E, the magnetic polarizability β̅ M, and the spin polarizability γ, and compare with available information from experiments and from previous calculations. Concluding with a critical discussion of our results, we point out the necessity of a future O(ε4) calculation.