Location: Mississauga, ON
Posted on: 15-12-06 14:43:02
HI,
Could you please advise which bank has best rates for GIC, and
if I didnt get open account for RESP by december/06, it can carry over to nxt year .
Thanks for all replies in advance
Location: carl sagan's universe
Posted on: 15-12-06 23:19:39
How many years is the GIC for? 1,2,3,4,5?
Better yet, how old is your child?
If you don't open now before end Dec /06 (some scholarship trusts cut-off date is Jan 8 if backdated to Dec 31), you can still claim this year's govt grant next year.
Banks may not be your best bet. Some credit unions and Trust cos offer better rates. Best to consult an RESP specialist. Personally banks for me are the worst in rates and service.
If your child is young, upto even 10 years old- maybe you would like to consider mutual funds.
This is just a sketchy reply. If you wish more info, please elaborate.
Gic interest rates vary depending on the place of investment(banks etc)..
Amount of money to be invested,Lockin period..longer the period (upto 5 years)interest rates are higher.Some establishments provide a small additional bonus(interest increase) for loyal clients.
RESP you cannot carry forward your contribution limit..neverthless you though your annual contribution remains 4000$ you can claim the government grant When a beneficiary has unused grant room there is the possibility for up to two full years' entitlement to be paid in a single calendar year. Every RESP beneficiary is entitled to the annual $400 in Grant money, which can be collected in the future if no contributions are made
Go through the links for detailed info...
http://www.hrsdc.gc.ca/asp/gateway.asp?hr=en/hip/lld/cesg/publicsection/faqs_resp.shtml&hs=cgs
http://www.altamira.com/altamira_en/accounts-services/accounts/resp.htm contributed in any one year
Location: Mississauga, ON
Posted on: 16-12-06 15:12:56
Thanks Investpro & Regars,
My Kids are of 8 & 6 yrs old and I read about the MF’s, is it wise decision to invest in MF, since there is lot of fluctuations in market. One of my friends advises me for GIC, I am confused, and will you please advise me in detailed?
What should I choose?
Thanks again for all replies,
Regards,
Jr. Desi
Quote:
Originally posted by investpro
How many years is the GIC for? 1,2,3,4,5?
Better yet, how old is your child?
If you don't open now before end Dec /06 (some scholarship trusts cut-off date is Jan 8 if backdated to Dec 31), you can still claim this year's govt grant next year.
Banks may not be your best bet. Some credit unions and Trust cos offer better rates. Best to consult an RESP specialist. Personally banks for me are the worst in rates and service.
If your child is young, upto even 10 years old- maybe you would like to consider mutual funds.
This is just a sketchy reply. If you wish more info, please elaborate.
Quote:
Originally posted by DigambarChahar
Thanks Investpro & Regars,
My Kids are of 8 & 6 yrs old and I read about the MF’s, is it wise decision to invest in MF, since there is lot of fluctuations in market. One of my friends advises me for GIC, I am confused, and will you please advise me in detailed?
What should I choose?
Thanks again for all replies,
Regards,
Jr. Desi
Quote:
Originally posted by investpro
How many years is the GIC for? 1,2,3,4,5?
Better yet, how old is your child?
If you don't open now before end Dec /06 (some scholarship trusts cut-off date is Jan 8 if backdated to Dec 31), you can still claim this year's govt grant next year.
Banks may not be your best bet. Some credit unions and Trust cos offer better rates. Best to consult an RESP specialist. Personally banks for me are the worst in rates and service.
If your child is young, upto even 10 years old- maybe you would like to consider mutual funds.
This is just a sketchy reply. If you wish more info, please elaborate.
HI Digambar,
The age of your kids is 8 and 6 which means that you have 10 & 12 years respectively for their university education. GICs would not give you desired returns. The GIC would barely beat the inflation. Since you have over 10 years, I would suggest you to contact a financial planner in your community and with his help and guidance invest in good quality mutual funds with balanced income and moderate growth and you would have much better returns.
Please note that Mutual funds typically have 5 or 6 years 'deferred sales charge' and your investments up to 2011-12 would exhaust schedule of these charges when your kids would start going to school. Your financial planner would suggest you the investment vehicle suitable for you at that time because your time span for withdrawal would be coming near.
Whatever you do, please make sure to open their RESPs account, preferably a 'family education' plan so that any of the kids would have access to the total fund. Please do not get confused this family plan with the group plans offered by some scholarship funds or education fund companies. Much has been written on RESP in Charcha section of this site and you would find good information and links there.
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Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada
Quote:
The age of your kids is 8 and 6 which means that you have 10 & 12 years respectively for their university education. GICs would not give you desired returns. The GIC would barely beat the inflation. Since you have over 10 years, I would suggest you to contact a financial planner in your community and with his help and guidance invest in good quality mutual funds with balanced income and moderate growth and you would have much better returns.
Pramod,
You know better than me that no one can guarantee returns on a mutual fund. So to say that one 'would have much better returns' is misleading. While GIC's though have limited returns they are guaranteed. One vehicle to look at is GIC which is linked to a broader index like the TSX60 or financials or energy or a combination of a few. In these GIC's the minimum return ranges from 0 % to a max of 60 %. The principal is guaranteed unlike a mutual fund. My limited experience with the financial industry says that mutual funds are now a story of the past. Typically investors have lost money in RSP's and RESP's if they have heavily depended on mutual funds.
Quote:
Please note that Mutual funds typically have 5 or 6 years 'deferred sales charge' and your investments up to 2011-12 would exhaust schedule of these charges when your kids would start going to school.
In fact these days most of the mutual funds are No Transaction Fee funds. While a few are DSC or Transaction fee funds the shift is definitely towards the NTF's.
Gic are good for short term as the returns are guarenteed but the returns barely beat inflation so the purpose of investing may be beaten ib the end..Mutual fund Investments are for long term though risky,.. but if well diversified and well balanced to provide some growth and income they are a good option ..nobody can give guaratees on return but it is a good idea to check the past history of 1,3,5,and 10 years before investing.
I would agree with pramod do open a family plan RESP as that leaves options option for future and with the contribution from the government makes the return pretty decent .
