https://padlet.com/ramandeep_rathor/money_matters_padlet By: Ramandeep Rathor en-us 2018-12-04 01:38:07 UTC 2025-12-06 12:22:27 UTC hello@padlet.com https://padlet-assets.s3.amazonaws.com/icons/Growing.png ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310715800 A Registered Education Saving Plan (RESP) plays a huge benefit to parents who work hourly jobs and aspire to send their children to post-secondary education. This tax-deferring plan makes large amounts such as $60,000 for 4 years of university possible if you were to invest merely $2000 a year. Many RESP plan investors benefit from compound interest as well so they gain a certain percentage back on every dollar invested. ]]> 2018-12-04 01:51:53 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310715800 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310717957 It's Good to Start Right Away! As seen in this image, a family that opens an RESP account as soon as their child is born end up with far more in the end. Waiting merely 6 years to make the decision has cost family number 2 almost $9,000. 
This image goes to prove that parenthood needs to be planned. A family must know exactly what steps they want to take for their children to ensure a brighter future for them.]]> 2018-12-04 02:05:08 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310717957 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310719058      This website lists out just some of the benefits that come with an RESP. It covers some of the key points such as the fact that friends and family can contribute to an RESP, or that the accounts grow tax-free. 
    What really stood out to me is the fact that an RESP account can be open for up to 36 years. A student has the choice to defer school for up to 18 years. I found that really fascinating because if your child does not choose to continue with post-secondary education right out of high school, a parent's investment money does not go to waste.]]> 2018-12-04 02:11:31 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310719058 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310720531   This Government site lists multiple topics that may cross the minds of those looking to invest. It breaks down many of the questions we have into greater detail such as who can invest and what a beneficiary is. 
     It's interesting that the Government doesn't want one's investments going to waste. When you've already been investing for so long (i.e. since the year your child was born), if your child's age exceeds 21 years, a parent can transfer the RESP investment to an Registered Disability Saving Plan (RDSP) plan to prepare for their own future instead.]]> 2018-12-04 02:19:48 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310720531 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310722244   The RESP Explained in 3 Minutes video quickly explains how parents can make their money work for them. It turns out, the Government actually includes grants and top-ups to RESP plans if you meet a certain threshold - Known as the Canadian Education Savings Grant.
     If an account receives an annual investment of $2,500, the Government will top it off with an extra $500 (CESG). This works really well when you're dealing with compound interest because what may seem like just $500 in the first year can easily turn into $5000 by the time your child is 10 years of age. If you factor in a 3% return, that's almost $6,000 of money that you've gained rather than worked for.]]> 2018-12-04 02:29:38 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310722244 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310724001      The Wealthy Life with Sybil Verch video is a short clip that goes over how an RESP should be used. For example, Verch explains that an RESP is like being on an airplane during low altitude moments, a parent must secure their own mask before securing masks on little ones. Likewise, Verch explains that parents must take care of their own financial status before their child's.
     One thing that stood out to me in this video is that there is actually a maximum allowed amount for a grant. It turns out, that the CESG money stops after reaching $50,000. ]]> 2018-12-04 02:40:14 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310724001 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310725915      As shown in this image, RESP assets are sky-rocketing as more and more parents are choosing to invest. It's important to note, that the number of contributions is also increasing. It's evident that the amount of assets is clearly growing faster than the amount of contributions.
     These statistics stand out to me as they clearly indicate that many other Canadians have found ways to make their RESP investments work for them. If the assets grow faster than the contributions (especially with compounding interest), it just goes to show that a small investment to begin with can turn into a huge reward in the end.]]> 2018-12-04 02:51:15 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310725915 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310728950   An RESP may not be the first investment option that crosses a parent's mind when they first begin to think of long-term investments for their child's education. These parents are right, there are actually many other options such as: Stocks, Bonds, GICs and more. However, a Registered Education Saving Plans is the one plan that makes the truly makes the most sense for long-term education saving.
 As seen in the figure below, a parent has a much higher chance at earning more with an RESP for their child's education saving because of the grant. The only time an alternative option may seem to make more sense, is when there is compound interest at over 20% (the rate for CESG). ]]> 2018-12-04 03:08:26 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310728950 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310731420      The article at this site makes parents think about the factors that help them chose the right RESP plan for their children. It sparks the thinking process of various options, contribution amounts, who can help contribute, and more. It's a great blog post for parents who need a step by step guide on what direction they need to head in.
     I found this particular link interesting because rather than just mentioning all of the reasons that parents should invest, it touches on ways to invest smart. A great example of this would be how a $20,000 investment would be better suited over the course of a couple years rather than as a lump sum. $20,000 over the course of a couple years lets the account take advantage of the Government's annual grant whereas the grant would only apply once if it were contributed as a lump sum. ]]> 2018-12-04 03:22:47 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310731420 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310731771      This video breaks down the steps that parents need to take so that they can open an RESP for their child's future. Parents must attain a Social Insurance Number (SIN) for their children when opening an RESP and are then ready. The Government also gives a grant to families with low income to help them get started.
     I found it fascinating that banks aren't the only ones to issue RESP accounts. Any licensed provider can help you get started with an RESP. Banks, Insurance companies, or even scholarship trusts are all great options. You just need to make sure you read all of the fine print and make sure you know if there are any fees, additional costs, minimum requirements, etc. It's good to know everything before signing.]]> 2018-12-04 03:24:28 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310731771 ramandeep_rathor https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310739038 Attached is a Word Document which explains and reflects on my understanding for this topic.]]> 2018-12-04 04:10:44 UTC https://padlet.com/ramandeep_rathor/money_matters_padlet/wish/310739038