Who is Eligible?
Any Canadian resident age 19 and over are eligible. However, the accumulation of contributions will begin at age 18.
What is it?
A TFSA allows you to accumulate growth in a tax-free savings account. Any withdrawals from the account are tax free as well. The contribution limit is $5500/ year. Any un-used contribution room can be carried forward continuously. Withdrawals can be made at any time. Any amounts withdrawn from your TFSA can be re-contributed the following year.
The TFSA’s provide a means for saving for short or long-term goals.
For more CRA information on the TFSA’s, us and we will be happy to assist you.
A RESP is one of the GREATEST GIFTS a child can receive!
Whether you are a parent, grandparent, legal guardian, friend or family member, you can open an RESP for a child.
A Registered Education Savings Plan is registered with the Government of Canada, so the money saved can grow in a tax shelter until the ‘beneficiary’ (child) is ready to enroll in post-secondary school. The government also provides several grants to help your child’s educational plan grow faster!
- The lifetime RESP contribution limit is $50,000
- The maximum annual amount of the basic CESG Grant that can be paid in any year is $500.
- The lifetime CESG (Canada Education Savings Grant) for each child is $7,200.
Available grants:
Canadian Education Savings Grant (CESG)
A 20% grant paid by the Government of Canada goes directly into a beneficiary’s Registered Education Savings Plan (RESP) every month.
Additional Canadian Education Savings Grant (Additional CESG)
Additional grants are available to low-middle income families. Families who fall within this category can receive an EXTRA 10% -20% of the first $500 deposited each month.
Canada Learning Bond (CLB)
A Canada Learning Bond (CLB) is a Government of Canada grant to help modest-income families start saving for their child’s education after high school. Recipients of the CLB can expect a $25 grant to help cover the initial administrative costs of the RESP, $500 for opening the RESP & a $100 annual deposit until the beneficiary turns 15yrs.
BC Training and Education Savings Grant
This “new” grant is available to all RESP beneficiaries who were born Jan 2007 or later. At the age of 7, any RESP beneficiary residing in BC will receive a $1200 grant from the Government of Canada.
How to Begin
Implementing an RESP is easy. In order to begin the application, the beneficiary (child) must have a SIN number.
At CHENO Financial we offer two types of RESP’s through different financial institutions.
My Education
- No minimum monthly contribution required
- A variety of investment choices available for you to choose from
Diploma
- Offers up to 15% bonus on all contributions when beneficiary turns 17!
- Minimum of $25.00 / month is required
Capital Guarantee!
An unparalleled benefit of purchasing your children’s RESP from an insurance provider is that any RESP deposits made contain an “insurance policy”. This “insurance policy” states that all principle monies invested into the child’s RESP is guaranteed up to 100% (subject to limitations). Please speak to your advisor about the Segregated Funds Guarantee for more information.
In 1957 The federal government introduced RRSPs, to encourage Canadians to save for retirement. Before RRSPs, only individuals who belonged to employer-sponsored registered pension plans could deduct pension contributions from their taxable income.
A Registered Retirement Savings Plan or RRSP is an account that provides tax benefits for saving for retirement in Canada. RRSP refers to a provision in the Income Tax Act that allows a person to shelter financial property from income taxes.
The program is regulated by the Federal Government of Canada and offers tax advantages to help Canadian residents accumulate financial wealth through a wide range of invesments.
Opening an RRSP is easy. If you are earning an income, you can begin saving for as little as $25/mo.
It is wise for young people to begin their savings as early as possible.