Fredi Magazine Spring 2016 / Volume 2 Issue 1 - Page 34

» the financial corner FINANCIAL CORNER BY ROCCO DIPASQUALE GIVING THE GIFT OF KNOWLEDGE Recently I met with a young couple that just had their first child. This recent addition to their family brought them a whole new list of priorities when they looked at their financial goals. spent some time with them and explained the updates we’d need to make to their financial plan, including saving for postsecondary education costs. I HAVE RECENTLY BEEN ASKED TO BE NAMED AN EXECUTOR IN MY FAMILY MEMBER’S WILL. I SAID YES, HOWEVER, I AM NOT SURE WHAT THIS MEANS AND WHAT RESPONSIBILITY I HAVE TAKEN ON. CAN YOU PROVIDE ME WITH ANY GUIDANCE? The RESP is set up as a amily Plan, which can be set up for various family members, including children, grandchildren and even siblings by blood or adoption . amily Plan offers several advantages, including the ability to name one or more beneficiaries in the same plan. n addition, the funds in the plan do not have to be shared equally among the beneficiaries, giving you more flexibility when it comes to making withdrawals. Making Contributions to an RESP n RESP is subject to a lifetime limit established for the beneficiaries. lthough you cannot deduct the contributions made to an RESP from your taxable income, the subsequent investment earnings on RESP contributions are tax-deferred. ualifying investments include G s, stocks, bonds, mutual funds and professionally managed investments. The Canada Education Savings Grant: A Potential 20% Return on Investment Perhaps the biggest advantage to contributing to an RESP is the anada Education Savings Grant ESG a powerful incentive from the federal government. ith the basic ESG, for an eligible beneficiary under the age of , the 34 • fredi spring 2016 Committing to Your Child’s Future One point I emphasized with the two new parents was the importance of committing to a regular, periodic investment plan. t’s truly one of the most effective ways to reach your goals. There are three key benefits to committing to making regular payments towards an RESP - LAUREN FROM MAPLE 1 It’s a convenient, yet disciplined way to save. The Foundation of Your Education Savings Strategy As I explained to this young couple, there are several different ways you can save for a family member’s education – but a Registered Education Savings Plan RESP o