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Invest in your kids

You want your kids to have rewarding lives, both personally and financially. One good way to help make that happen is to invest in them with a Registered Education Savings Plan (RESP).

In today’s highly competitive world, having a post-secondary education is a definite advantage. A post-secondary education can be expensive for your kids, the average cost of a four-year program was approximately $58,000¹ – and rising every year. But it remains a great investment. That’s why so many Canadians are saving for their kids’ education.

Here’s why an RESP is a great way to invest in your kids:

  • Maximum lifetime limit of $50,000 per child with no annual maximum
  • Government will add 20% of contributions (max of $1,000 per year and a lifetime maximum of $7,200) via the Canada Education Savings Grant (CESG)²
  • Lower-income families may be eligible to receive additional CESG amounts as well as the Canada Learning Bond (CLB)³
  • Contributions aren’t tax-deductible, and withdrawn contributions by your enrolled child aren’t taxed
    • Educational Assistance Payments, which consist of CESG, CLB, and plan income or growth, are taxed at the student’s income level, meaning your child will likely pay little or no tax on those withdrawals
  • Your child can access RESP funds as soon as they enroll in an approved post-secondary program
  • If your child decides not to pursue a post-secondary education, contributions may be returned to the RESP subscriber, or the RESP can be transferred to another child
  • Any contributions remaining in the plan after your child finishes their education are yours to use as you wish

Investing in a Registered Education Savings Plan is a good decision. Your professional advisor can help you achieve financial stability for your family and a debt-free education for your children or grandchildren.

Reviewed: February 16, 2015

1www.hrsdc.ga.ca http://www4.hrsdc.gc.ca/.3ndic.1t.4r@-eng.jsp?iid=54#a2

2CanLearn http://www.canlearn.ca/eng/planning/saving/cost.shtml

3The Canada Education Savings Grant and Canada Learning Bond are provided by the Government of Canada. CLB eligibility depends on family income levels. Some provinces make education savings grants available to their residents.

This column, written and published by Investors Group Financial Services Inc. (in Québec – a Financial Services Firm), and Investors Group Securities Inc. (in Québec, a firm in Financial Planning) presents general information only and is not a solicitation to buy or sell any investments. Contact your own advisor for specific advice about your circumstances. For more information on this topic please contact your Investors Group Consultant.