Advantageous Savings Method for Post-Secondary Courses

A university or college degree is often a prerequisite for a great career. Your child may want to study at post-secondary level in order to acquire the necessary knowledge for exercising a morally and financially rewarding profession. As a parent, grandparent, or relative, you can give your beneficiary the education they deserve by investing in a Canadian Registered Education Savings Plan. You can entrust the management and administration of your plan to the Heritage Education Funds, a foundation that manages over $2 billion in assets at present.

A Heritage RESP representative can be contacted online, on the phone, or in a local office. The provider’s home office is in Toronto, but there are branch offices across Canada. You will receive expert consultation and full clarification on your choices. The plan will be designed after careful consideration of your budgetary needs in order to meet your particular requirements. There are many different contribution choices, and you can select the best one with proper guidance. You can make small contributions often or pay annually. Every RESP plan enables you to obtain various government grants, some of which are worth thousands of dollars.

One of them, the Canada Education Savings Grant, can give your child up to $500 or $600 every year, until they reach the age of 17. What is more, the Canada Learning Bond awards an initial sum of $500 and an extra sum of $100 every year until your child becomes 15. There are also some grants for residents of Alberta, Quebec, Saskatchewan, and British Columbia. The Alberta grants will eventually be eliminated, but no definitive date has been set for this yet, so you may still qualify.  Two of the provincial incentives mentioned above are new. Specifically, the grant offered to residents of Saskatchewan will debut in fall 2013. A beneficiary may receive up to $4,500. The British Columbia grant offers $1,200 per child, who must be born on or after 1 January 2007. An application form needs to be completed when the child becomes 6 years old, and be sent before the beneficiary is 7; it will probably be launched in late 2014 or late 2015. Heritage will be able to provide more relevant information after the provincial governments give notification of their requirements.

When your beneficiary begins studying at a post-secondary institution, they will be able to receive Educational Assistance Payments, which are made up of income on principal, government grants, and income on government grants. With the Scholarship Option, the EAPs can be allocated to a student over a period of 1 to 3 years; with the Self-Determined Option, the EAPs are given to a student who attends a qualifying program; in case the beneficiary does not attend such a program, they are awarded an Accumulated Income Payment (AIP).

It is worth noting that your RESP savings are tax-free and that makes them more advantageous than any other methods of savings. You can also consider a plan with increased payments and further student savings bonds. An early increase in RESP contributions can also boost your tax benefits and offer you a stronger return.


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