Education Investing

The Canada Education Savings Grant provides a 20% bonus on any monies deposited into a Registered Education Savings Plan (RESP). If your goal is to save money for you child’s future education, the RESP is a great investment and savings vehicle to choose.

Sure interest rates are very low these days but with a 20% bonus on annual amounts saved up to $4000*, even locking into a 3% GIC gives you a NO RISK 23% RETURN!

The plan works similar to the RRSP that most of us are familiar with. The biggest commanality between these two plans comes from being able to shelter investment gains from tax. Any gains that are made within the RESP account are not subject to tax as long as they’re used for education purposes down the road. This benefit allows for tax free compounding of your growth which, when compared to typical cash account fully taxable investing can make the difference between covering a two-year diploma program for your child and providing them with a full degree scholarship of sorts.

Of course there are always little in’s and out’s to these plans that you need to be aware of before getting going, and that is what we are here for. Your first step is to make sure your child gets a Social Insurance Number as this piece of identification is needed to set up an RESP account.

Meet with us and we’ll go over all the fine details of the RESP account and provide you with a wide range of investment options as well as advice as to which investment options may be best for you.

The 20% Canada Education Grants are one of the very few ‘free rides’ that our government gives us. The Cash Flow Investing team strongly encourages that you take advantage of it!

Planning for Education