Pranav,

Do not confuse the need for RESP, or the RESP scheme with investment decisions. While they are linked, they are mutually exclusive. You can have one without necessarily having the other.

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Chandresh

Advice is free – lessons I charge for!!

I completely agree with Mr. Sunil Sharma. The people sitting in the govt. who make such decisions and policies, always have the mandate in favor of Govt. So govt. is not fool to give us 20% grant like that. This mandate was indeed in favor of Govt. Govt was giving Grants for education purposes and these Grants were being misused a lot and so were getting very expensive for the Govt. So govt decided to stop these grants and start a program called CESG Canada Education Savings Grant. In which Govt. will give the grant only if the parents are ready to save something for there kids education. As far as the education Loans are concerned, don’t you want your child to actually start their career debt free?

When you invest in RESP you not only get the 20% grant from the govt., you also get the interest which the company pays depending on the market conditions. But these Investments are very secure as the money is invested under the National Policy 15 which states the money can be invested only in Govt. Bonds, GICs etc., which are stated as secured investments under this policy.

RESP is not tax deductible but it is tax sheltered. It means that the Growth on deposits remains tax-free until the Nominee (the person for whom the RESP was established) begins to use those funds for their post secondary education. Only when the Nominee begins to use the RESP for education does the investment income become taxable and it is taxed in the hands of the Nominee, who as a student typically has little other income. Accordingly, he or she pays little or even no tax on RESP income. Virtually all full time post secondary education is eligible for assistance through RESPs.

ANY FURTHER QUESTIONS REGARDING RESP OR WHICH COMPANY IS BETTER OR WHICH SCHEME IS BETTER, PLEASE FEEL FREE TO CALL ME ANYTIME @ 905-672-3789 OR 416-409-8291. ALONG WITH THE AUTO INSURANCE 'FREE INFORMATION SESSION', WE CAN ALSO HAVE 'RESP FREE INFO SESSIONS'.

Rgds,

What are the rules for transfer of funds from one RESP plan to another?

what will happen if the child does not go for education? Whether it will be transferred to another child? or encashed? if yes what will be tax implications?

Whether we can encash grants if child does not use the total funds available under the plan?

what are other limitations of RESP for withdrawal or cancellation of plan or non contribution for a period?

This will further clarify the issue.

Thanks

Hi,
I need some info regarding investment options in Canada
Currently I have good amount of money in both US doller and Candaian checking account in TD Canada Trust
Could any one tell me what are my options to get back lilltle more interest rate .I am not interested about long term investment plan like RESP
or share purchase
Want to know investment option in Both US doller and Canadian doller

Will appreciate any kind of info
Thanks

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ani

Hi Ani,
I 'vent much idea abt d investment options in Canada as I'vent yet started on tht.But ve found tht ING Bank definitely pays great interest of 2.5% compared to a measly TDs 0.05% & CIBCs 0.1% !!!

Check out der savings calculators :: http://www.ingdirect.ca/en/pd_calculatorstools.html#

Its an internet bank, so, good if u r saving & dont knw when & how fast u need all d money.

I might be late in joining this discussion, but I can definately say one thing -that any body who thinks prudent and wisely, without being prejudic to; why Govt is offering 20% grant and all sorts of other notions; (which in my personal opinion - are like a frog in a well thinking that he is in a ocean.) { Please do not misunderstand me, I am not trying to be harsh or pinning down anybody personally} will certainly go for RESP.

It is very lucarative as you get 20% top up on your deposite, in other words, where, who, and how , in the world you are going to get 20% on an on going basis ( up to plan maturity or 18th year of the child) Gauranteed as long as you continue deposit. People considering alternate investment for kids education should not forget to factor in taxes on investment income. Other option like investing in India @ marginally higher interest of 1 or 2 % must also account for currency i. e. rupee depriciation and also possible Revenue Canada's questions about where and how you got this money. Be prepared to pay taxes and possible consequences of not reporting income etc. etc.

After carefull and thorough consideration, in depth knowledge of how RESP works, different options, flexibilityand other tangible benefits, RESP is undoubtedly the best choice for child's education.

One has to think and go beyond the boundaries and be educated thouroughly to understand and reap the benefits of RESP.

Registered Education Savings Plan (Canada)

Regards,

Ayaskant Roy.


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“Seek, and ye shall find; knock, and it shall be opened unto you.”
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Success

To laugh often and much;
To win the respect of intelligent people and the affection of children;
To earn the appreciation of honest critics and endure the betrayal of false friends;
To appreciate beauty, to find the best in others;
To leave the world a bit better, whether by a healthy child, a garden patch or a redeemed social condition;
To know even one life has breathed easier because you have lived.
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