Parents are always looking out for their children, no matter how old they are. A post-secondary education is a dream that I have for my children’s future. It is great to have dreams, but how, as a parent do I go about making these dreams, like college or university, a reality? I know one way is to start putting money away as soon as I can to help achieve this goal.
While my younger children are just toddlers, one of my eldest child’s ‘someday’ goals is to be a professional athlete. Though she is keeping her options open just in case she does not make it, this is what she would like to do with the rest of her life. She has a cousin who is also pursuing this dream, so we have an idea of what it will take to make her someday a reality. It will take a lot of hard work, and a post-secondary education would help her become drafted into the sport she would like to pursue as a career, or to help her in her other endeavours.
There is still one thing I was not sure about: Where do I start saving for my children’s ‘Someday?’ Growing up, my mom was not able to save for my university education. It was tough (and it continues to be rough) to pay for my education. I do not want for my children to have to worry about whether or not they are going to be able to become whatever they want because we cannot afford to pay for it, nor do I want for them to stack up debt as soon as they are finished their education. After doing some research into my different options, I found out I could put money aside for my children by setting up an RESP with RBC!
Some of you may be asking what an RESP is and why would I want to use one to save for my child’s educational future? A Register Education Savings Plan is a tax-sheltered plan that helps you put money away for your child’s post-secondary education that can be set up by anyone (a parent, grandparent, child, etc.).
What is great about creating a savings plan like this? There are some great reasons why an RESP is a mart and ideal method of saving for your child’s educational future! Below are just a few of them!
These plans are flexible. Once you have opened an RESP, you can choose any dollar figure to contribute whenever you would like to this savings plan with frequencies ranging from weekly to annually. You can start with small regular contributions quick and easily with RESP-Matic. This way, you do not have to remember to make these contributions as it is taken out when you schedule them to be put towards your RESP. For example, if you saved $25 per week, it will add up to $50 911 in 18 years! This would be a great amount of money to have saved for when your children are ready to start their post-secondary education! You also get $500 a year in government grants (up to $7 200) to put aside for your child’s education.
The investment earnings on RESP contributions are tax-deferred (the interest income and investment growth earned within an RESP will not be taxed so long as the funds are kept in the plan, and will be taxed to the student who will pay little or no tax once withdrawn). You can contribute to an RESP for up to 31 years, and a plan can stay open for 35 years.
What if your child’s ‘Someday’ changes (as they often do), and a post-secondary education is no longer something they would like to pursue? Another advantage of an RESP is that there are options that can be used to help you to help your child follow their new dreams.
Check out this video about how RBC understands how parents get from their child’s ‘Someday’ to the beginning of their adult lives.
#RESPwithRBC Twitter Party
RBC is also holding a Twitter Party on Thursday, September 17, 2015 at 9 PM! Participants will learn a lot of information about RBC RESPs while having a lot of fun and connecting with RBC! Those attending the party will also have the chance to win one of six $150 Visa gift cards! During the party, follow #RESPwithRBC!
The RBC RESP is a great option for my family to take to easily save money to help make my daughter’s ‘Someday’ become more of a reality! I cannot wait to book an appointment with an RBC advisor to open up an RESP. You can click HERE if you would like to open an RESP with RBC!
This post is sponsored by RBC. The opinions and language are all my own.