Post secondary education is very expensive in North America and unless you are fairly wealthy will be a worry for most parents. Obviously, not all kids go onto University or College but if they do and you havent planned for it you could find yourself with a large financial burden. This would probably happen just when most families are looking at finally having some financial security
A Registered Education Savings Plan – RESP – is vital for your financial health if you have kids who you feel may want to go into post secondary education. An RESP is government sponsored (Registered with Canada Customs and Revenue Agency) and is allowed to grow tax free. Money paid from the plan at maturity may be taxed as income for the student.
The plans are administered by private companies/persons (Promoter) who will collect contributions and invest them accordingly. Up to $4,000 per beneficiary (student) can be contributed per calendar year, with a lifetime limit of $42,000 without any tax implications. Each student may have more than one plan but the limit is strictly per student.
The most important aspect of the RESP’s is that the Government will add...
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