First you were putting on their diapers. Then you walked them to their kindergarten classroom. You helped them with their math homework. You listened to their loud music through the walls. Are you ready for what comes next?
Post-secondary education tuition can cost over $6,000 per year.1 If you have multiple children, you are looking at a lot of money if you are planning on helping them out. How can you make this process easier?
A Registered Education Savings Plan (RESP) is one option. Contributions to these accounts receive a 20% match from the Canadian Education Savings Grant up to $2,500 per year, which is $500 of free money. If your income is low, you can receive a 30-40% match on the first $500. Setting up a trust account is another option to help pay for college.
Saving for Post-secondary education can appear daunting, but it doesn’t have to be. Your financial advisor can help create a road map so you can make progress in steps. Before you know it, your child will be out of Post-secondary education, and you’ll be putting on diapers again – on your grandchildren.
RESPs are Registered Education Savings Plans that grow tax-free until the child is ready for university, college or a vocational institute. The student usually pays little or no tax on those funds when they are withdrawn at the student's lower...
The TFSA is a registered savings account that allows taxpayers to earn investment income tax-free inside the account. Contributions to the account are not deductible for tax purposes, and withdrawals of contributions and earnings from the account are not taxable.