The Canadian Government offers registered savings plans for anyone wishing to save money for a child’s post-high-school education. These plans are available to open at most any banking branch or financial institution. They come in three types of plans: family plan, individual plan and group plan.
When you are ready to start saving money for your child, remember that special terms dictate which types of accounts are right for you to open. If you are opening one for one or more of your own children by birth or adoption, you can choose to open a Family Plan or even a Group Plan. You could opt for the latter if someone else will be participating in saving the educational funds with you and they are not related to the children.
You will get the full tax shelter benefits by placing money in the selected type of plan account. You can also keep the account open for 36 years. When you know which plan is right for you, you will want to select a good provider with which to open the savings plan.
In addition to the Family and Group plans, there are Individual plans. These are geared towards anyone wishing to open a plan for a child who is not related to them. A child could also open this type of account up for him or herself.
Before you start shopping around for providers, be sure you and the child each have a Social Insurance Number. Once you have this information, it can be very easy to find a RESP provider.
Most banks and financial institutions offer you the ability to open any kind of plan with them. However, each institution will charge different fees for opening or maintaining the accounts. Also, they may dictate the minimum you can open up the account with as well as the minimum balance to be maintained.
You will also want to know if your investment can go up or down during the time your money is held in the savings account. This will help you decide whether or not to open the plan with a particular bank or institution. Also, be sure to ask what will happen to your money in the event you need to close the account out early or in the event that the child decides to go to college part time only.