When I gave birth to my first child, my dad gave me a brochure and an envelope. The envelope contained money and the booklet contained information about RESPs. I was happy with the money (I did not expect that this little angel required so many things: diapers, clothes, crib, etc.). I was not interested in the information about RESPs. After all, my child was only a few days old and we had all the time we wanted to plan for his education. It can wait, I thought! My dad had a different opinion and asked (or should I say ordered) that I spend that money on opening an RESP savings account for my baby. I was not very happy. I was an adult and I can make my own financial decisions for myself and my baby.
I did not count on my dad’s persuasion and patience to convince me to open an RESP. It took him some time, but he managed to do so eventually. Hopefully, I will convince you too and not within months but TODAY! It is so important to start saving for your child’s education as soon as possible. They grow up so fast and you shouldn’t waste that precious time like I did. You will regret it. But first what is an RESP?
What is an RESP?
RESP stands for Registered Education Savings Plan. It is available to Canadian families to help them save for their child’s post-secondary education. This is probably not news to you, but did you know that post-secondary education is not free? It is not cheap either. Besides the registration and annual fees, you may have to pay for housing, textbooks, clothes, etc. Of course, your child can help by taking a job, but it won’t be enough to pay for all the expenses. Besides, I don’t want my child to work too much or burden himself with student loans. I want him to concentrate on his studies. In order to help you save for your child’s education, the Canadian Government set up an RESP program. The account beneficiary (your child) is eligible to receive government grants. Don’t we love all those grants?
The Government of Canada contributes 20% of the first $2,500 in annual contributions. Isn’t that the best return on investment ever? 20% is huge! Besides, the interest made on those savings are tax-free (while it is in this account). I am in love with this program.
You can get the most out of your RESP by saving the maximum amount eligible for the government grants which become available to your child starting the year they are born. The good news is these grants are carried forward each year if they are not used, so if you find it difficult to make a contribution or maximize your contribution in some years, you can make up for it by increasing contributions in the following years to receive grant from previous years. Easy, right? Bear in mind that there is a lifetime RESP contribution limit of $50,000 per child.
Now the question: How do I start saving in an RESP?
You need help and professionalism in this matter. You need a trusted organization that will open this registered account. An organization that will maximize your annual return besides the government grants. You need Children’s Education Funds Inc!
- It has the PTPA seal of approval. I feel confident when I see that seal. It means that this organization is trustworthy. After all, I will be depositing my hard saved money.
- In 2014, they paid $68,000,000+ to Canadian Families.
- And because I love bonuses, if you open a new CET Plan in 2016, you will receive 25 Air Miles® reward miles in celebration of Children’s Education Funds Inc.’s 25th Anniversary.
So why wait? Don’t waste time and money – contact CEFI today online or by calling 1 (800) 246-1203 and book a consultation. The clock is ticking! While visiting the site be sure to enter the CEFI promotion to win an additional 10,000 Air Miles and the contest to win a Disneyworld vacation.
Are you already saving in an RESP? Share your tips for saving more money for your child’s education below!
Although this post has been generously sponsored by The Children’s Education Fund Inc., the opinions and language are my own.