Are you one of the myriad Canadian parents who intend to pursue and continue the college education of your kids? Are you confused on how you can be able to fund their costly college education? If you are one of these parents, then you are advised to consider the Registered Education Savings Plans. Should you be interested to learn more about RESP, its benefits and requirements, then the best thing that you can do is to peruse this article further.
It is sad to note that the university tuition and education of our kids are among those that keep on increasing over time. This sad reality is not only true for the Canadians but also for the other countries as well. Studies reveal that greater than 93% of the Canadian parents intend to pursue the post-secondary education of their children. Nonetheless, with the constant rise of college tuition fees, books and the college students’ living expenses, there are already lots of parents who are doubtful if they can still pursue the college education of their children.
Eventhough, college education is considered as the key to ensuring their bright future but the college education costs are astronomical. Figures show that the yearly college education costs is forecasted to increase to about three or four times. Are you worried on how you can fund your child’s college education? The best option available is to save early for your children’s college education with the use of the Registered Education Savings Plans.
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Definition of the Canadian Registered Education Savings Plans
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Actually, RESP is one of the most effective and famous educational savings tool in Canada that lets parents to save early for the post-secondary educational costs of their children. It is regarded as the most effectual way to plan the future of children. Thanks to the existence and creation of the RESPs because it gives parents the permission to take part and to benefit from the Canadian Education Savings Grant. It was also found that each child in Canada has the eligibility in receiving approximately twenty percent from the government’s educational funds to increase their RESPs. It means that when parents invest $100, the Canadian government will also give $20. Much more, those poor Canadian families can get around 40% of the CESG bonus. Keep in mind that only children with RESP can obtain the CESG assistance from the government. Aside from the things showcased beforehand, what are the other benefits of RESP?
1. Parents have no limit on their annual RESP contributions.
2. Parents’ maximum lifetime RESP contribution is $50,000.
3. Parents’ RESP contributions are not taxable.
4. The moment your children are qualified for either full-time or part-time education program, then you are given permission to give contribution to the fund, that can be used for birthdays and Christmas.
Should you want your children to reap the benefits showcased by RESP, then invest in the program as early as now!