Savings refer to money you put aside for future use (education for the kids, taking the trip or for retirement income) rather than spending it immediately. In addition to the benefits of saving up for future purchases, delaying an impulse purchase also helps you decide whether it is something you really need or a waste of money you will regret shortly after buying.
What is RESP & How it works?
RESP stands for Registered Education Savings Plan. RESP is the best tool available in Canada for your children’s Post-Secondary Education. The Primary benefits of RESP plan is to Provide Canada Education Savings Grant (CESG) and money will generate as tax-deferred income.
Here is an overview of how an RESP generally works.
- A subscriber enters into an RESP contract with the promoter and names one or more beneficiaries under the plan
- The subscriber makes contributions to the RESP. Government grants (if applicable) will be paid to the RESP. These grants can be the Canada Education Savings Grant (CESG), Canada Learning Bond (CLB), or any designated provincial education savings program
- The promoter of the RESP administers all amounts paid into the RESP. As long as the income stays in the RESP, it is not taxable. The promoter also makes sure payments from the RESP are made according to the terms of the RESP
- The promoter can return the subscriber’s contributions tax-free
- The promoter can make payments to the beneficiary to help finance his or her post-secondary education
- The promoter can make accumulated income payments
You can always contact us for more information about your children’s better future investments. (Post- Secondary College or University)