As a parent, you want your child to have all the opportunities and things that you were never able to have yourself. So, this can include things like clothes, other luxuries and a college education. A college education is very important for your child, and a lot of parents are not able to send their children to college because they lacked the necessary funds for it. So, if you want to make sure that your child goes to college, you need to make sure to start saving and collecting money for it beforehand. Now, you might think of going to a bank and open a college savings account for your child, but we would advise against that. This is because there is a better way to go about this, and that is by opting for an RESP.
A registered education savings plan is a government initiative that allows families from all over the country to be able to open a savings plan for their child and contribute to it overtime and save money for their child’s education. There are companies like Knowledge First Financial that are under the government that help to provide RESPs to families, so you first need to find out which companies that are RESP providers fall in your area. Now, an RESP is better than a standard savings account for a number of reasons.
- First of all, you do not have to pay any taxes for the amount of money in your RESP. So, no money is deducted annually, allowing you to be able to save properly.
- The government also adds some money to your child’s RESP annually through different grants and funds as well. So, you get financial aid as well.
- There is no fixed expiration for the plan. So, your child can start college immediately, or can start 10 years later and still have the money waiting for them in the plan.