So, you have reservations about setting up an RESP for your child. You may believe it’s complicated to do, or doesn’t make sense for your family. You are not sure what happens to your money if your child chooses not to attend college or university, or think that if student loans worked for you, they will work for your child too…. If any of these happen to be your concerns, please see the eight reasons below to set up an RESP for your family, today.
1. Without an RESP your child is missing out on up to $7,200 worth of free government money in the form of a Canadian Education Savings Grant.
2. By setting up a family RESP you may be allowed to transfer your savings within your family. If one child chooses to not attend post-secondary education the money can be used for another sibling.
3. Your child does not have to attend university to use their RESP. The institutions which your child may attend and use their Education Assistant payments towards are varied – from a 3-week apprenticeship to a full-time medical residency. (source: http://www.esdc.gc.ca/en/resp/use.page?#h3)
4. If your child chooses NOT to attend post-secondary education you may be able to transfer up to $50,000 of earnings tax-free from the RESP to your RRSP. Meaning you do not have to choose between saving for your child's education and your retirement! (source: http://www.esdc.gc.ca/en/resp/use.page?#h3)
5. Your own contributions within the RESP can always be withdrawn TAX-FREE
6. If you currently receive the National Child Benefit Supplement for low-income families you can receive an additional $2,000 towards your child’s RESP without having to contribute any of your own money in the form of the Canada Learning Bond. (source: http://www.esdc.gc.ca/en/education_savings/clb.page)
7. An RESP has the ability to pay you interest (earn you money on your investment). If your child chooses to use student loans to fund their education they will be required to pay interest on their loans following graduation.
8. It is easy to do, just give me a call to start saving for your child’s future, today!
Brooklyn Scott is a Financial Advisor/Mutual Funds Representative for Lewis & Jones Group/Desjardins Financial Group/Desjardins Financial Security Investments Inc. in Killarney, Manitoba.
Mutual funds are distributed through Desjardins Financial Security Investments Inc. For insurance products, Desjardins Financial Security Investments Inc. acts as a national insurance brokerage agency