We’re coming to the end of 2014 and as per usual, it’s time to consider a few New Year’s resolutions to start 2015 off right. Not all resolutions have to be about losing weight, exercising more or getting organized (although, you know I’m writing another post about THAT). We often make resolutions about our finances and this year, I’m making that a high priority. If you’ve been following along in this three part series, you’ll likely now know that I’ve had a reality check on what it takes to educate our children. In the first of the series, I discussed the 10 items you may be paying for in university. It was a shock to finally put all the numbers to paper and realize that the final bill in the spring of 2015 may total over $23,000 for the first year of post-secondary education. This financial ‘accounting’ took everything but the kitchen sink into my daughter’s journey to the University of Ottawa: campus scouting trips, application fees, residence, meal plans, trips home, tuition, books and even pocket money. The second instalment of the series was about ways you can save up for said costs: picking up extra writing work, summer jobs, scholarships and bursaries, RESP contributions and government grants (a bit more on that today). This final post is about three New Year’s Resolutions – Financial Planning for the Next Two.
Three New Year’s Resolutions
Coming up with a solid financial plan to SAVE.
This has to be one of the most important resolutions that I could make. Coming up with a solid PLAN TO SAVE. That means reviewing sources of income (more blog posts, freelance work, tutoring and summer jobs for my daughter). It also means committing to setting aside monthly contributions for each of the children, reviewing where our family funds are going to today, and making adjustments. That means making some hard choices on vacations, that new pair of boots or putting off buying a new car.
This also means review possible tax savings and government incentives to help us save.- Adding more funds into the new RESP.
The sooner in the year we can add funds to the children’s RESP the better. As with most years, all three children receive Christmas cash from their grandparents. It’s never a given, but they’ve consistently received money that they’ve set aside for ‘bigger’ gifts. A few years ago, that was new ski equipment and a ski jacket for one and a school trip to Quebec City for another. Two years ago, my eldest put that cash directly into savings for her Me to We trip to Ecuador.
This year, all of those funds will go directly into their RESP accounts to stash away for their post-secondary education.
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Taking advantage of the Government Grants and Tax Free Savings.
A Registered Education Savings Plan (RESP) is a tax-sheltered savings account. By setting up an RESP, you set the wheels in motion to take advantage of both federal and provincial saving incentives. The key to accessing these is to apply for a Canada Education Savings Grant (CESG) that matches your contribution (to a limit of $7,200) by the Government of Canada once a parent opens a RESP for a child. You can also access up to $2,000 from the Canada Learning Bond (CLB). Although I mentioned this in my last post, it is worth repeating that you can qualify for provincial grants, depending on which province you live in: for example: (1) the Alberta Centennial Education Savings (ACES) Plan (up to $800); (2) the Quebec Education Saving Incentive (QESI) (up to $3,600); (3) the Saskatchewan Advantage Grant for Education Savings (SAGES) (up to $4,500) and; (4) in 2015, the British Columbia Training and Education Savings Grant (BCTESP) (up to $1,200).
All these programs are subject to eligibility and may have age restrictions, but it’s a good idea to look into them because they could potentially provide you with extra funds to help you get your child a post-secondary education. Your RESP also offers tax sheltering on your investment income until the plan matures. Once your child is ready to use his/her RESP for post-secondary education, the funds are taxable under the student’s name. Because students commonly have high exemption status and low income, the taxes they pay should be low (if they pay any at all).
I am happy with this whole review. This RESP blog post series has been an eye-opener for my family but it has also proven to be effective in getting us motivated and moving forward with a financial plan for our children. It is obvious you can learn from the mistakes we made by not starting an RESP when they were young, but it’s never too late to start saving. We have three years before our next child goes off to university or college, and then two more years for the last one. With some luck and a lot of hard work, our eldest should have graduated by then and she will be on her way to a meaningful career. Until then, we’ll continue to work hard and save for their success.
Since you are going to be doing some savings for the future @DownshiftingPRO is giving away a $50 VISA GIFT CARD (in Canadian Funds) to one lucky winner.
Please note carefully: This giveaway is open to Canadian Residents (excluding Quebec) 18+ from Dec. 30 2014 to January 31, 2015. Entrants will need to supply a valid name (no nicknames or on-line name), IP address and email address for verification. They will have 48 hours to respond to the email as well as answer a skill testing question. If you do not contact me within this time another winner will be chosen. Please check your spam file.
Good luck to all that entered. Many thanks to Heritage Education Funds for sponsoring the Giveaway!
Disclosure: I have been compensated for the series of blog posts but all opinions are my own.
Margarita Ibbott is a travel and lifestyle blogger. She blogs about travel in Canada, the United States and Europe giving practical advice through restaurant, hotel and attraction reviews. She writes for DownshiftingPRO.com and other online media outlets.
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A little bit of money at a time can add up and make a huge difference!
I found out that Government Grants can really help with college costs.
i need a better financial plan for my kids post secondary and our retirement
that its best to start the savings when the kids are young as college is so expensive
I learned that the government contributions make a big difference so you should start early!
I’m still paying off $12000 to OSAP 🙁 Never once used my degree either. Lots of very useful information that I could’ve used.
By reading this post I learned that Government Grants can really help with college costs.
it is never to late to start
come up with a good financial plan to help you save
I learned in this article that I could try to qualify for provincial grants, depending on the province you live in: for example, in my province Alberta, there’s the Alberta Centennial Education Savings (ACES) Plan (up to $800) which I could put toward my child’s college education.
If you have a child you better have a long term plan to afford their education
Learnt that if you have a child you better have a long term plan to afford their education
i learned that Government grants can be very helpful for college
Starting early to save is so important – it is amazing how quickly it all adds up – thanks!
I was interested to find out government Grants can really help with college costs
Government Grants can really help with college costs was interesting to find out
Financial planning is important and something we need to instil in our kids
Financial planning is important and something we need to teach our kids
I learned that financial planning is important. And the earlier you do it – better !
I’ve learned more about the grants, yay for free money!
its important to remember university costs aren’t just tuition. theres room and board and food sometimes, books, travel, class-specific tech and more.
I learned the importance of staring to plan early
I’ve learned not to forget about government grants at help with the cost, also that it is never too late but start as early as possible.
I learnt that that education is always getting more expensive
I learnt that as soon as your child is born start planning on their education cost,
I didn’t realize that there were grants and special tax-free savings programs for children’s future college and university. Good to know!
The federal matching dollars for an RESP is really where the big savings comes in. Well worth doing.
Oops I meant Financial planning is something I am working on at the moment. Helpful tips! Thank you!
Financial planning is something I am working on Financial Planning at the moment. Helpful tips! Thank you!
Awesome resolution! Such a great idea! 🙂
The Canada Learning Bond is something I need to learn more about
I learned it is never too late to start saving.
Start saving early and have a plan
I learned education is very expensive, so you should start saving for your childs education as early as when they are just born!
it’s never to late to start saving!
I will be checking to see if NB offers any educational grants.
I learned to start saving early and have a plan, thanks for the tips!
I learned it’s never to late to start saving
I learned that as soon as your child is born start planning on their education cost, the sooner the better
All of the hidden expenses that you don’t think about or forget about. That university is much more than I thought
to start putting money away and it I expensive to send a child to college/university
I learned that its better late than never, so get to it !!
I learnt that once your child is ready to use his/her RESP for post-secondary education, the funds are taxable under the student’s name & not yours
that education is always getting more expensive unfortunatley!
You know it is. We are bound and determined not to get student loans but alas, this may be what we have to do with child number two.
Learnt that if you want the best education for your children make sure that your savings match the number of children you decide to have
I learned that the government offers money to match your contributions.
I learned that its harder to save for my kids than I ever knew, but there are ways with lots of discipline and love to make it happen
I learnt that it is never too late to start saving.
I learned that Government Grants can really help with college
The tips are awesome. I have 2 young ones who are still long ways off from college but the tips still would apply even for them.
Learnt that the final bill may total over $23,000 for the first year of post-secondary education – shocked – so glad when I went to University in Britain my parents didn’t have to pay anything – everything was paid for by the State and I got a grant otherwise I would not have gone
I learned that its better late than never
I learned that i am very unprepared and better start thinking about it now since i have three small kids!
start early
Learnt that it is never too late to start saving.
I learn that the earlier I start the RESP for my kid the better, as it is tax free savings.
Learnt that because students commonly have high exemption status and low income, the taxes they pay should be low (if they pay any at all).
That post secondary education savings are possible if you have a solid plan! Plus the earlier you start the better!
Learnt that once your child is ready to use his/her RESP for post-secondary education, the funds are taxable under the student’s name.
i learned the earlier the better
I learned that I should take advantage of the Canada Education Savings Grant (CESG) that matches my contribution to my child’s RESP and it is always good to start the plan early
learnt that your RESP also offers tax sheltering on your investment income until the plan matures.
I had no idea there was so many options and so much to look in to !
I learned that its better late than never! Start saving now!
Learnt that you can qualify for provincial grants, depending on which province you live in
This is all great information. Useful for everyone. Thanks so much!!! Bookmarking now!
Start early!
Think ahead and plan ahead for kid’s future education so they don’t spend too many income earning years paying off student loans!
I learned that my children are pretty much SOL. We have zero savings, nothing put aside for anything and its not a possibility to start now either. We are barely making our rent each month. My 17 year old will be looking at post secondary education, but we have zero idea how we’re going to pay for it.
Great advice and tips to save for future educational costs! Love learning about government grants
Learnt that you can also access up to $2,000 from the Canada Learning Bond (CLB)
I learn that it’s never too late to start and it’s very expensive to get a good educations. Better start saving now.
start saving right away , with the government program, it is so much easier now to start saving, every little bit helps
To come up with a solid plan. Plan it and do it.
I learned that it is never to late to start saving
Learnt that Canada Education Savings Grant (CESG) matches the contribution (to a limit of $7,200) by the Government of Canada once a parent opens a RESP for a child.
I learned that the sooner I start saving for my kids’ education, the more they will have available to them.
most important thing ive learned is its never too late to start saving for your childs education
I learned that it is important to apply for a Canada Education Savings Grant (CESG) that matches my contribution (to a limit of $7,200) by the Government of Canada once I open an RESP for my child.
I didnt know how important an RESP is
contribute monthly to the RESP
learnt that by setting up an RESP, you begin the process to take advantage of both federal and provincial saving incentives
Learnt that a RESP is a tax-sheltered savings account.
I learned that college is crazy expensive and to start early to save toward their educations so it will not be as much of a financial burden later on.
I’ve learnt that its never to late to start saving
Realised that it would be best to start saving the day they are born
I learned that the sooner I start contributing to an RESP, the better it will be.
that is best to start saving when you children are young as it is very expensive to go to college/univesity
Learnt ( and remembered) that any cash given as gifts can be add into the new RESP.
Plan well in advance!
College and university are extremely important in a knowledge-based economy. I have been committed to saving for both the girls from the time they were babies. I know that makes a difference. I like the opportunity that an RESP gives. Heritage is a great plan and I have been reading a lot about it in the social world. I think the important part is getting started early to maximize government contributions.
It is incredibly important to start early! Even a little bit of money at a time can add up and make a huge difference!
That is oh so true and we are learning it the hard way. Make sure to set some aside… when you don’t see it, you won’t spend it.
So very right. It is also important to get the right advice on how to invest correctly. If you are interested make sure to contact a Heritage Funds rep. to help you out. They are the pros.
I never knew that you could access up to $2,000 from the Canada Learning Bond (CLB)
There a program that you can access but you need to ask… it is never a given. That’s why it is good to talk to a RESP representative to help you navigate those questions.
That it’s important to start saving early
Sooo important to start early and save often (if you can).
You’re right – it’s really important to make financial resolutions as well as health ones… I’ve just moved out of home so I’m definitely going to have to re-budget! x
How exciting. I remember when I graduated from university, my parents thought that I would just move home again and live close to them, I had different plans. I stayed in Montreal, then moved to Toronto and then Vancouver. I have to say, I’m glad I started my RRSPs then when I had a bit more cash. Just save a bit every month and you’ll see results right away…
I learnt how crazy expensive it can be sending your kids to university.
CRAZY EXPENSIVE is right. But you can do it cheaper if your child stays home, goes to a college instead of university or does this all part time and works part time. There are ways to get them there. It just takes some hard work.
Awesome tips, glad i read them!
Thanks Ivy. I hope you come back again for more tips. You can never find out too much about how to manage finances.
It’s so important for people to start investing in their futures and plan their financial paths early. It’s so sad to see elderly people having to work because they don’t have enough in their retirement accounts to supplement government payouts.
I do find that in the stage that I am at now, I worry about my children’s future and my elderly parents. You are right that saving for our retirement is important also.
I have learned that you really need to start early with saving for your child’s education. The sooner, the better. I learned that an RESP is a great way to save and is tax sheltered.
Thanks for reading the whole post, you covered all the key messages that I was hoping to relay. SAVE, SAVE, SAVE.
collage is so expensive. loans are great but you have to pay them back with a ton of interest. Saving early on is the way to go!
We have opted to help our daughter pay for school as opposed to her getting student loans that will just be a financial burden to her. We really need to start her off on more solid footing than crushing debt.
I had no clue about the provinical grants that are availabled
I have learned that starting a RESP is so important and that it is never too late to get them going. I just signed my children up a few weeks ago at ages 10,8,and 5.
Anna, it warms my heart to think that you have taken progressive steps to help your kids out. I hope that you are able to take advantage of some of the provincial and federal tax incentives.
Getting an education is very costly. You need to plan for your children early in life.
Florence, if you have time, make sure and drop by the other two posts in the series to give you a breakdown of what it costs to send a child to university and how to save towards that end. Thanks for dropping by.
With four kids, planning for their future education is very important.
Heidi. It is so true. You are challenged with four kids. I think three is enough to worry about. Good luck to you!
I learned that it’s never to late to start saving.
I learned that the huge expense of college can be affordable if you prepare well in advance.
learnt to review possible tax savings and government incentives to help save
I’ve learned about the tax aspect of RESP’s.
Great tips, I learned that we need to start early!
I’ve learned just how expensive post secondary education is when you figure it all in! I also learned that some provinces have additional grants offered with RESPs
I’ve learned that starting to save early can help in the long haul
It is tax-free account and you can sign up for Canada to double the amount.
I have learned that it is never too early to start planning and saving especially with how the cost of post-secondary education is rising.
Follow on You Tube as Judy C
I saw that… thanks Judy. I hope you find some great info in my vlog posts. P.S. Thanks so much for the follow.
So very true! Planning is so very important!
learnt that you need to make so hard choices – about your holiday destination, buying items that you need rather than want
awesome advice two thumbs up
Great advice look forward to following this with my kids
Learnt that reviewing where family funds are going to, and making adjustments is the thing to do
I learned that provincial
Govt give grants out too which i never knew
This is great advice! With 3 boys coming up into the world…I have no idea how we’re going to afford college for our kids. We still have over 30K in student loans to pay off of me and my husband’s.
This is so important! My husband is a financial planner, and people just don’t get how important it is. Thanks for sharing.
Learnt that it would be a good idea to commit to setting aside monthly contributions for each of the children,
should review sources of income – can you make more money
This is really nice and explanatory post! Really useful!
I’m really bad at keeping New Year’s resulotions, so I don’t make any. But I really like your idea of coming up with a solid plan to save. We have done really good with our savings even without a plan, but I’m sure we could do much better.
I need to start contributing to an IRA for myself and taking advantage of the tax savings. I’m super good about saving money, but I need to invest it and shelter it.
Come up with a sound financial plan to save
Those are great resolutions! Financial planning is so important, especially when it come to saving up for college.
Financial planning is something I am working on. Great tips!
This is the year of financial planning! I need to be ready for my kids to go to college and I want my husband to be able to retire at a decent age!
By reading this post I learned that Government Grants can really help with college costs.
Our children are not college aged but we have already started saving. I do want to get our finances and spending in order for 2015. Thanks for the tips.
Hi! I just wanted to let you know that I tried to subscribe to Downshifting via FeedBurner but get this error message, “The feed does not have subscriptions by email enabled.” Thank you!
Pam thanks for letting me know. One of my to-do list items is to get a better subscription service going. I appreciate the comment.
I’ve learned a lot from this series, but the most important thing to me is that it’s never to late to start saving! I had always thought it was too late, but this has been a real eye opener for me.
Great resolutions to have. Luckily here in Ireland university isn’t so expensive so I don’t need to save up a lot for my son, who is only 1 at the moment anyway. We do have an account for him though and have quite some money in it for him when he turns 21.
College is such a huge expense! I had to take out loans for myself, and I’m still paying those off. O.O My girls are just 1 and 2 years old, but my husband and I are already trying to get their college funds started so that we won’t have to stress too much in the future.
Ahhhh college is so crazy expensive!!! Thankfully my parents paid for mine… But my daughter…. She’s only two but hubby and I have already talked about how we either gotta win the lotto or rob a bank to pay for her college hehehe…. But I’m thinking your post on financial planning sounds like a better idea than depending on the lotto hehe 😉
Feedburner – it comes up with the message – The feed does not have subscriptions by email enabled
Learnt that if you have a child you better have a long term plan to afford their education
Great tips indeed. This sounds like a really good New Years resolution. Financial planning is so important and we need to show our children early how to save also.
My step son is going to college next year and as of right now, we have no idea how it’s getting paid for – other than student loans.
It is amazing how expensive college can be, and how quickly all of the costs add up. I was lucky that when I was in high school, I did a program called PSEO and was able to complete an entire year of college completely for free- saved so much money that way!