Kids with big dreams?
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Kids with big dreams?
We’ll get you there.
As a parent, few things are as gratifying as thinking about your child’s promising future. And few things are as worrisome as how to pay for the education to help your child achieve that promising future.
In Canada, the average annual cost of tuition in 2022 was $6,834, before books and additional program fees. For kids in many rural Alberta communities, going to college or university often means moving away from home and paying for rent, food, and other living expenses. It’s a heavy financial lift.
Fortunately, if you’re planning ahead and contributing regularly – even small amounts – an RESP can add up pretty quickly. For several reasons, it’s one of the most effective ways to save for a child’s education. The trick is ensuring you get the most out of the RESP by:
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capitalizing on available government grants
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starting as early as possible (no time like the present)
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investing mutual funds† that may provide a higher rate of return.
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At VCU Financial, in partnership with Aviso Wealth we can help you maximize your education savings.
* Mutual funds are offered through Aviso Wealth
As a parent, few things are as gratifying as thinking about your child’s promising future. And few things are as worrisome as how to pay for the education to help your child achieve that promising future.
In Canada, the average annual cost of tuition in 2022 was $6,834, before books and additional program fees. For kids in many rural Alberta communities, going to college or university often means moving away from home and paying for rent, food, and other living expenses. It’s a heavy financial lift.
Fortunately, if you’re planning ahead and contributing regularly – even small amounts – an RESP can add up pretty quickly. For several reasons, it’s one of the most effective ways to save for a child’s education. The trick is ensuring you get the most out of the RRSP by:
-
-
capitalizing on available government grants
-
starting as early as possible (no time like the present)
-
investing in the equity markets through qualifying mutual funds† or investments that may provide a higher rate of return than a guaranteed product.
-
At VCU Financial, we can help you maximize your education savings.
* Mutual funds are offered through Credential Asset Management Inc.
Registered Education Savings Plans (RESPs)
A RESP is one of the most effective ways to save for a child’s education. Your RESP contributions become tax sheltered earnings and they can help you qualify for up to $7,200 in matching contributions from government grants. A RESP can be used for tuition, books, living expenses and more.
Fast facts:
- The Registered Education Savings Plan (RESP) is a purpose-designed savings plan to help you get the most from your education savings funds. An RESP can be used for tuition, books, living expenses and more.
- Your RESP contributions can help you qualify for up to $7,200 in matching contributions from government grants.
- Unlike RRSPs, contributions to RESPs are not tax deductible. These education savings plans are tax-sheltered investments, which means capital gains and income earned on contributions aren’t taxable until the funds are withdrawn. The upside? As a student, the beneficiary will typically have little income and will pay minimal tax when they withdraw the savings.
- The lifetime limit for contributions for the plan is $50,000 and there is no annual limit.
- An RESP can be opened as an individual or a family account. Individual accounts can be opened by anyone, family accounts must be set up by a family member. Talk with a VCU Financial advisor to learn which of these is right for you.
- You must apply and receive a Social Insurance Number (SIN) for the child before you can open the RESP.
- Withdrawals can start as soon as the student is enrolled in a qualifying post-secondary educational program. Qualifying programs include trade schools, apprenticeship programs (lasting a minimum of six weeks), colleges and universities.
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