The importance of educating your child cannot be overemphasized. Education opens up a plethora of opportunities in life. However, nothing of value comes for free. Just like any other investment, you need to secure the future of your child by ensuring that he or she has a proper education savings plan at Heritage RESP.
The cost of college education is ever on the rise and without proper planning your child will miss out an opportunity to get the quality education.
What should you do to guarantee your child’s college/University education?
A Registered Education Savings Plan (R.E.S.P) is the best way to start planning for your child’s future in terms of education. There are several institutions that offer R.E.S.P. and for that reason, it is important to consult widely to ensure that you choose that you make the right choice.
There’s no excuse a parent can give for not planning for their children’s education. From the time your child is born, you have about 18 years to accumulate adequate money that will cater to the college education of your child. Besides, the government also contributes 20% tax-free on top of your contributions.
Unfortunately, procrastination often gets in the way of some parents and by the time they wake up, it’s already late.
How do you get started?
Lack of adequate information is often blamed as the reason why some parents fail to adequately plan for their children’s education.
One of the first things you should do is to visit the Government’s R.E.S.P. website and get all the facts before you make any move. Apart from that, consult with lending institutions and determine how much you can contribute towards the R.E.S.P program.
Merits of a Registered Education Savings Plan
• There is no annual limit in terms of contribution
• There’s an addition of 20% from the government
• The maximum lifetime contribution is $50,000
• People from low socio-economic background qualify for more funding from the government
There are certain things that a parent should understand about R.E.S.P.
• In case your child does not proceed with post-secondary education, ensure you know the rules that apply when withdrawing or closing the account
• The RESP contributions are exempted from tax
• You should not go for RESP if you are financially stable. This is because of the administrative and withdrawal fees that are often charged.
Why you should not delay starting saving on your child’s education.
The education of your child is a worthy investment and that is why you should prioritize it more than anything else. You might think that you will start saving after some time but what if the inevitable happens? Of course, nothing will happen. What I am trying to say is that it is important to plan ahead.
In a nutshell, education is a basic right and every child is entitled to it. Failing to plan is planning to fail. Sacrifice for the future of your child by starting to save as early as possible to guarantee your child’s college/University education.