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Back To School and RESP Time

If your child is starting Junior Kindergarten this week (or next), and you have not opened an RESP for them, can I ask why you haven’t?  Make it a new back-to-school tradition. Make an RESP contribution on September 1st (as well as other times during the year).

Go to my RESP page, and read some of the stories about how simple it is to open this kind of account and how helpful it can be (and how much of a pain it can be to extract your money). Still, if you think your child has a chance of attending a post-secondary program, you need to start saving immediately.

CIS Rugby
Those Tuition Fees do fly high like #7 in this photo!

Some provinces are talking about changing their “student loan” system so that more grants are given out. I suspect the business of post-secondary education will keep out-stripping inflation for a long time.

However, I must warn you about many of the RESP savings systems offered by many banks. Especially those that only allow you to purchase the bank “value added” mutual funds. Find somewhere that does not have a lot of extra fees, where you can grow the money you get from the government because it will not be enough, to pay for a complete education. Interesting that one Insurance company that had a Giraffe as their mascot seems to have gotten out of the RESP business. Don’t use a group RESP either, very bad idea!

Start saving for that education if you plan on paying for it. If not, relax and enjoy the upcoming NFL season, or maybe the playoffs. Back to school does not need to be a complete panic.

The Globe and Mail

After all, it is Free Money.

Back To School

A few other quick views on back-to-school and RESPs

Feel Free to Comment

  1. Far be it from me to disagree with good long-winded rant against a Canadian bank, but we just withdrew RESP money for our son who’s just headed to his first year at university and had no difficulty. My wife just dropped in to the local branch with a couple of void cheques and told them how much to transfer over. Painless and fast.

    I do completely agree with your love of RESP’s in concept. Regular RESP contribtions by us, along with having our kids work through their high school summers with a forced school savings plan (they have to save a specified percent of their income for school, and then they have to pay for a 1/3 of their university costs) have meant that there’s not been that much out of pocket for us when they go to university. Granted, they live at home and commute to school which helps. I still like to complain about it but really, our use of RESP’s has meant that university hasn’t been unaffordable.

    1. If you did your “withdrawal” without a “Proof of Enrollment” of some kind, you may have a rude surprise when your money is not given out (Bank must have record of your child’s enrollment or they get in trouble (is my understanding)). As I have said my biggest problem is that the TD Mutual Fund system is cumbersome at the best of times, ridiculously frustrating and unaccomodating at their worst.

      Helping your kids, by teaching them the value of money, and ensuring they have some “skin in the game” (i.e. they spend some of their own money on their education) is an excellent methodology as well.

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