Can I open an RESP for myself and transfer to my children’s RESP account later?
You can make contributions into an RESP until 31 years after you first opened it. After that time, however, you can transfer savings from other RESPs into a single plan.
Can you set up more than one RESP?
Yes, more than one RESP can be opened for the same child (lucky kid). But, there’s a maximum lifetime RESP contribution limit for any child of $50,000. Beyond that, penalties will be imposed.
Can you contribute to your own RESP?
Can I open an RESP for myself? Yes. You can contribute to an RESP for a maximum of 32 years (the year the plan opened plus 31 years) and name yourself or another adult as the beneficiary of your plan.
Can I change an individual RESP to a family plan?
You can combine individual plans into a family plan at any time, provided all of the beneficiaries are related to the subscriber by blood or adoption.
Is it too late to contribute to RESP?
Good news! It’s never too late to adjust your financial planning and incorporate this component. As financial planner Angela Iermieri says, it’s best to start contributing to your child’s RESP when they’re young so you can save more and take full advantage of matching government grants.
Do I need a separate RESP for each child?
So, if one child does less or cheaper post-secondary education than another, you can use more of the RESP funds for one child and less for another. So, you can contribute to a family RESP and get government grants just like you can with an individual RESP.
What are the disadvantages of an RESP?
Disadvantages of an RESP
The biggest disadvantage of an RESP is that any earnings that are withdrawn but not used for post-secondary education incur a twenty percent penalty, and income taxes must be paid on the money.
How do I transfer money to my RESP?
Sign in to the RBC Mobile app(opens new window): Tap ‘Move Money’, select ‘Transfer Between my Accounts’, select an eligible RBC Royal Bank RESP investment and follow the on-screen instructions. Call us any time at 1-844-357-8242. Visit your branch.
How much should I contribute to RESP to maximize grant?
$2,500
What is the RESP Contribution Limit? There is no annual RESP contribution limit. However, to maximize your potential annual CESG grant of $500, it’s recommended that you contribute up to $2,500 to your RESP per beneficiary per year. Keep in mind that the lifetime contribution limit for any one beneficiary is $50,000.
What happens unused RESP?
Government grants will be returned at the time of the withdrawal but growth is kept. The money that was contributed to the RESP over the lifetime of the plan may be withdrawn and returned to the subscriber. Contributions withdrawn are not subject to any additional tax.
What is the RESP deadline for 2021?
December 31, 2021
December 31, 2021. Unlike some other accounts with tough-to-remember contribution cutoff dates, RESP’s annual deadline couldn’t be easier to memorize. If you intend to contribute for the current year, you may contribute into an RESP up until the final day of the year, December 31.
What is the deadline for RESP contributions 2020?
December 31, 2020
Unlike the RRSP deadline, which is 60 days after the end of the year, the deadline for 2020 RESP contributions is Thursday December 31, 2020. In order to make contributions to RESPs more attractive, the government enhances the benefits.
What is the maximum RESP contribution for 2021?
There’s no RESP contribution limit in 2021, or any year, for that matter. However, you probably want to contribute about $2,500 annually (or approximately $208 per month). Here’s why. First, the RESP lifetime contribution limit is $50,000 per beneficiary.
At what age do RESP grants stop?
You can contribute to an RESP for up to 31 years, and the plan can remain open for a maximum of 35 years. Under the CESG, the government matches 20% on the first $2,500 contributed annually to an RESP, to a maximum of $500 per beneficiary per year. The lifetime maximum per beneficiary is $7,200, up to age 18.
What is the best RESP in Canada?
Best RESP Providers in Canada
- Wealthsimple RESP. Wealthsimple is Canada’s top robo-advisor with over $10 billion in assets under management. …
- Questwealth RESP. Questrade’s managed investment services, Queswealth Portfolios offer RESP plans. …
- Justwealth RESP.
How much should I put in my RESP per month?
$208.33 per month
When do I start? You hear it all the time, but experts say the sooner you save, the better. Starting an RESP account is ideal and contributing about $2,500 per year per child—or $208.33 per month—would be optimal said financial advisor Derek Moran.
Should I max out RESP?
For most people there isn’t much point in contributing more money than is necessary to max out the grants. Without the sweetener of RESP grants, you’re generally better off doing something else with the money if you have any debts, or unused TFSA or RRSP contribution room.
Are RESPs worth it?
Parents believe that, on average, their RESP will be worth almost $28,500 when their children need it, a recent RBC survey revealed. But, as most parents start RESPs when their child is 2 years old, their RESP will typically be worth $22,500 by the time their child is 17 — a shortfall of $8,000.
Is a TFSA better than an RESP?
A TFSA allows you to skip the income tax on that earned interest income in the account and grow your money tax-free. When you use an RESP, you’re also spared from paying annual income tax on any interest, investment income or grants earned in account.
What is the best investment for RESP?
Everything from cash and mutual funds to GICs, stocks, bonds and ETFs can be used to build up your RESP. As you approach the date of decumulation, you may want to gradually shift to a more conservative strategy, particularly if your initial strategy was strongly growth oriented.
What do I need to open an RESP for my child?
Opening an RESP
- get a Social Insurance Number (SIN) for your child, and get one for yourself if you do not already have one. There is no fee; however, certain documents, such as birth certificates, are required.
- choose an RESP provider that best suits your needs.
What happens if a child decides not to use their RESP?
When you close an RESP without using it for your child’s education, you must: Pay taxes on the money the investment has earned. Return any Canada Education Savings Grant money. Note: If a sibling has grant room available, you may be able to use it for their education.
Can a grandparent open an RESP for a grandchild?
Grandparents can open an RESP for their grandson or granddaughter, even if he or she already has an RESP, since a child can be the beneficiary of more than one plan. For instance, the parents can be the subscribers of an RESP and the grandparents the subscribers of another one.
What is the best way to save money for a grandchild?
This way you won’t have to deal with an 18-year-old blowing thousands of dollars tricking out an old car.
- Savings Account. One of the easiest ways to save money for your grandchild is a savings account. …
- Certificates of Deposit. …
- Brokerage Account. …
- UGMAs/UTMAs. …
- 529 Education Savings Plans. …
- 529 Prepaid Tuition Plans.
What is the best way to save for my grandchildren education?
10 easy ways grandparents can help pay for college
- Pay tuition directly to your grandchild’s school. …
- Offer your grandchild a loan. …
- Pay off your grandchild’s student loans after they graduate. …
- Buy your grandchild U.S. Savings Bonds. …
- Set up an education trust.