We are off next week (in lieu of the traditional March break which I believe most schools get). It used to be called "reading week" when I was in University - a time to study and get essays done before the push for finals began. In reality, I doubt much reading was done. Those who could, jetted away for their spring break. The rest of us peasants went home to hang with family and friends.
I called this week to set up an appt next week to talk with the rep at the bank and find out more information about my RESPs (Registered Educational Savings Plans for those outside of Canada). With DS heading off to college, I will need to find out how I go about accessing those funds when I am ready to.
Right now I have a little over $16 000 in the account.
DS2 turns 17 this calendar year, so according to this webpage, the government grant I get for making these deposits ($20 for the $200 I put in each month), ends this year. That will leave me the remaining 6 months of his Grade 12 year and then he graduates.
Now I can keep putting the money monthly in this RESP account after this calendar year, but would no longer receive the grants. I am not sure of the benefit of doing so as opposed to putting the money in a high interest savings account. Do I receive interest within the program? I know, I should know this.
By the time DS2 is done high school I will have about $20 000 in the account (unless I have removed some for DS1's schooling) That gives me about $10 000 per child to help them out.
I really wish I had started this earlier, or been in a position to start this earlier, but my time machine is broken and I can't change the past. I am beyond grateful for whatever prompted me to get this started when I did a few years ago. It gives me, as I said, some cash to help them out. It also demonstrates very clearly to me that $200 a month, set aside consistently month after month, can really add up.
Any insight from current RESP users and withdrawers will be most happily welcomed. I have a family RESP for those who were wondering.
Tuesday, Nice weekend!
1 day ago
2 comments:
I think it's awesome that you've saved that much! I would be thankful if my parents had done that, so good for you! I live in the US, so I have no idea about how this works, but good on you for taking care of this for your sons!
You have to leave the funds in the plan until your kids need them, they make the withdrawals with proof of enrolment themselves so that the income from the investments are taxable in their own hands. If you withdraw the money yourself then the grant is taken away and the income you've made is taxable to you unless you have enough RSP room to take it tax free, but then you would have to withdraw the funds and be taxed later anyways. You can move the funds in the RESP to a HISA and your sons would cash out as needed. Hopefully your bank rep gives you correct info. Good luck!
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