Establishing a savings goal you can achieve
When establishing your savings goal, the best approach is to balance what you want to achieve with what you can afford. You are able to invest up to $50,000 per child in an RESP. While education costs are seemingly always on the rise, saving the maximum amount is a definite benefit. But setting an attainable goal, one you know you can achieve, is the first step towards turning your child’s dreams into reality.
Here are some things to consider when establishing your goal:
Is your child planning to take a 4-year program?
Will your child live with you during school? Or require residence?
Will your child have a part-time job during the course of their program?
How old are they now? How many years do you have to save before they start university or college?
When to start saving
It’s a long road from nursery to post-secondary school. Starting early in your child’s life will help you save more and will give more time for your money to grow. To establish your goal, you can take your annual savings amount times the number of years to post-secondary.
Add the grants and the growth and you’ll have a better understanding of what you’ll have in the end.
How often to save
Establish a regular saving schedule is a key to success. With any of our RESPs, changes can be made during the life of your plan, but try to consider what method will set you up for the most success down the road: monthly, bi-weekly, annually, etc. You may like the structure of bi-weekly payments or the flexibility only annual lump sum payments can bring.
Reaching your goal faster
Whenever you come across extra money during the life of your plan, consider rolling it into your RESP because even the smallest contributions will add up over time. And remember, once you open your plan, anyone can contribute to it, so encourage friends and family to add to your child’s education savings on special occasions like birthdays.