Leave Room In Your Holiday Budget
Let Dreams Soar With An RESP
What’s on your holiday wish list for your child?
It’s holiday time again and as children make their wish lists, have you thought about what would be on your wish list for your kids? Yes, you love the see the anticipation on their faces as they open that entertaining toy or treat, but beyond all the seasonal excitement, there’s an opportunity to give a gift that goes beyond the end of the year and that will build toward their longer-term dreams – dreams they may not even know they have yet, but which they’ll appreciate as they grow older.
Opening an Registered Education Savings Plan (RESP) for your child and contributing a portion of your holiday budget toward that RESP is the gift that keeps on giving. That toy may be tossed aside within a few weeks, but the investment you make into an RESP will pay off for a lifetime, by helping your child access the post-secondary education that will allow them to follow their dreams. Not only will the money you invest grow, but you’ll be able to add to your investment with government grants, such as the Canada Education Savings Grant (CESG), that can boost the value of your savings by up to $7,200 per child. Plus, up to $50,000 of each child’s RESP grows tax-deferred.
‘Tis the season to give the gift of education
And don’t forget the cash presents that your children may receive from grandparents, aunts or family friends. They probably don’t know about the latest toy craze, but they do know how important post-secondary education is, and they’ll appreciate knowing that their gift contributed to such a meaningful goal. Simply deposit the money into your child’s RESP and accelerate your savings. Remember, like every RESP deposit, every dollar gains access to the CESG.
If you don’t already have an RESP for your child, now is the perfect time to open one. It’s easy to set up, and once in place, easy to add to the balance. To be able to turn cash gifts into contributions, you’ll want to choose a program that is less structured in its contribution plan and enables you to making additional contributions as you work toward an established savings goal. You’ll also appreciate a program that requires less day-to-day management. The Flex First Plan from Knowledge First Financial is the perfect choice, combining the flexibility of adding to the plan whenever you want, with the confidence of having professional portfolio managers focused on a conservative strategy for steady growth over the long term. And the Flex First Plan is also more flexible down the road – if you decide not to use the funds for post-secondary education, they can be transferred to your RRSP or withdrawn as an accumulated income payment.
Whether you already have an RESP in place, or you’re just considering setting one up, a contribution to your child’s future is always the perfect holiday gift. Easy to set up, easy to use, and no need to explain to the grandparents what slime is and why your child wants it. Knowledge First Financial has been helping Canadian families save for education for over 50 years. Contact us to get started.