RESP CONCEPT
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1) Making RRSP contributions provides tax savings that can be used to fund an RESP for children, allowing parents to save for retirement and education at the same time through a "double-dip" strategy. 2) The RESP is also eligible for government grants like the CES Grant worth 20% of the first $2,500 contributed annually. 3) Starting RRSP contributions now through a PAC plan allows savings to grow tax-deferred over the long run while freeing up tax refunds for RESP contributions.
RESP CONCEPT
- 1. Comprehensive Tax Planning Solutions It’s okay to “double-dip” Jaffer Hussain Consultant Help secure your Here’s why the ultimate Start now family’s future “double-dip”works so well: Finding the funds to make an As a parent, you have to be a terrific 3 When you make your maximum annual RRSP contribution may seem juggler. You juggle time to complete allowable RRSP contribution you difficult – especially, with all the daily all the tasks and chores that fill your may enjoy tax-savings that can be juggling going on in your life. So why day. You juggle responsibilities to applied towards establishing or not start now? Talk to your Investors ensure your children have the best adding to your children’s RESPs. Group Consultant about setting possible childhood and prospects for up a Pre-Authorized Contribution 3 The federal government’s CES (PAC) to make monthly RRSP their future. Yet the toughest juggling Grant program provides a contributions. Your RRSP will begin act of all is managing your finances matching grant for each RESP to compound on a tax-deferred basis while raising a family. It can be contribution made for an eligible for a potentially fast and stronger even more difficult to find the extra child. The Basic CES Grant is worth growth over the long term. You can dollars needed to invest towards 20% on the first $2,500 of an even arrange for your employer to a comfortable financial future, annual RESP contribution or reduce withholding taxes at source including your retirement and the $500 per year. This eligibility based on your RRSP contribution educational plans of your children. accumulates and carries forward, schedule, so that you can fund If you’re a parent of young children, so even if you were unable to make monthly RESP contributions instead you are probably struggling with a enough of an RESP contribution to of waiting for your tax refund in the tough decision: Is it better to first access the full Basic CES Grant spring to make an annual RESP save for your retirement through money in previous years, you can contribution. It’s a win-win situation Registered Retirement Savings Plans start to make up for it now and in that will allow you to also capitalize (RRSPs), or to save for your children’s future years and get the Basic CES on the ultimate “double-dip”. education through Registered Grant money your child would have Education Savings Plans (RESPs)? received in those earlier years. Let us help you feel more confident about your future – plus make sure Fret no more because there is a 3 Families with children born after you take full advantage of all the way to do both: Make your RRSP December 31st, 2003 who also tax-saving and income-building contribution before the deadline each receive the National Child Benefit opportunities that are available to you. year and use the resulting tax refund Supplement may also qualify for to make an RESP contribution. That’s additional funds through the the ultimate “double-dip” because Canada Learning Bond.* your child’s RESP can also take advantage of “free” cash from the federal government in the form of a Canada Education Savings Grant (CES Grant).*
- 2. Jaffer Hussain Suite 701 305 Milner Avenue Consultant Toronto, ON jaffer.hussain@investorsgroup.com M1B 3V4 (416) 659-5140 1-800-848-7229 Written and published by Investors Group as a general source of information only. It is not intended as a solicitation to buy or sell specific investments, nor is it intended to provide tax, legal or investment advice. Readers should seek advice on their specific circumstances from an Investors Group Consultant. *The Canada Education Savings Grant and Canada Learning Bond (CLB) are provided by the Government of Canada. CLB eligibility depends on family income levels. Some provinces make education savings grants to their residents. Investors Group Financial Services Inc. ™Trademark owned by IGM Financial Inc. and licensed to its subsidiary corporations. “It’s okay to “double-dip” © Investors Group Inc. 2010 (04/2010) MP1262