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RateSupermarket.ca > Money > Registered Education Savings Plan (RESP) > RESP top 10 tips
Registered Education Savings Plan (RESP) top 10 tips
We've scoured online websites, offline resources and spoken to our expert consultants to find the best research and advice regarding Registered Education Savings Plan (RESP) and the Canadian Education Savings Grant and compiled them in our RateSupermarket.ca Top 10 tips.
Read on below to learn how to benefit the most from RESPs in Canada.
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1) Start early, earn more
The money you invest in an RESP can grow much more quickly if you start saving early. Now only can you rack up more government grants (if you meet the requirements), but you can also make interest on the money.
2) Find the right provider for you
Make sure you shop around and speak with a few different RESP providers before making a decision.
3) Ask questions and know what you're getting into
You should feel comfortable asking your RESP provider as many question as you have. For a list of important questions to ask visit Canlearn.
4) Be wary of marketing tactics
Don't be persuaded by promotional offers or pushy sales people. Also understand how the person selling you the RESP is paid.
5) Due diligence
Check the credentials of the RESP provider. Make sure they are registered and have the appropriate qualifications.
6) Check the fees and other costs
Make sure you understand any fees associated with the RESP. If fees are charged, make sure the services offered justify the fees.
7) Know what you're signing
Always read the fine print before signing an investment document, particularly an RESP. RESPs can differ drastically so make sure you understand all of the terms before signing.
8)Double up
If you can't afford a contribution one year, you can always double up in the next year and earn double the Canada Education Savings Grant money.
9) Don't take the money out early
Don't withdraw RESP contributions before the beneficiary starts a post-secondary program. If so this may suspend the grant contributions.
10) Save on tax when payments are made
Beneficiaries only need to report the eduacational assistance payment, EAPs as taxable income. This includes the income, growth, or Canada Education Savings Grants (CESGs) paid out from the RESP. Any contributions paid to the beneficiary are tax-free.
Go contact a RESP expert now now.
