Not sure how to make a savings plan? Read on…
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As the country re-opens after COVID-related restrictions, Canadians are faced with a worrying financial picture. Many have moved, others are looking to travel, and the cost of living is ballooning with unusual rates of inflation. Meanwhile, the Bank of Canada (BoC) rate hikes designed to curb these .... More »
How much credit card debt does the average Canadian have? + MORE Nov 7th
As the country re-opens after COVID-related restrictions, Canadians are faced with a worrying financial picture. Many have moved, others are looking to travel, and the cost of living is ballooning with unusual rates of inflation. Meanwhile, the Bank of Canada (BoC) rate hikes designed to curb these .... More »
How much credit card debt does the average Canadian have? + MORE Sep 26th
As the country re-opens after COVID-related restrictions, Canadians are faced with a worrying financial picture. Many have moved, others are looking to travel, and the cost of living is ballooning with unusual rates of inflation. Meanwhile, the Bank of Canada (BoC) rate hikes designed to curb these .... More »
How annuities work in Canada + MORE Jul 17th
Annuities are life insurance products that pay a regular income to a purchaser. When you buy an annuity, it’s like buying a pension plan with a lump sum premium paid from your savings. The payments you receive include a return of your original capital and interest income on that capital. It ma.... More »
How to draw money out of your corporation in retirement Nov 7th
Incorporated business owners can sometimes be unsure of how best to decumulate, drawing from their corporate savings along with their other investments and pensions. Corporate savings do provide complexity as well as opportunity.
From paying yourself a salary to drawing income
Business owners .... More »
My three kids chose different educational paths. How do I withdraw RESP funds in a way that’s fair to them and avoids unnecessary taxes?
– moneysense.ca
Q. I have a Registered Education Savings Plan (RESP) for my three children, the youngest of whom is starting university this fall. We have made some withdrawals for the older two kids but the plan is still well-funded. Our middle child has decided to pursue a co-op university program, which is essentially self-funded. When we contributed funds to the plan, part of the funds were put aside under his name and the government added grants to that. To be fair to him (and to avoid taxes), I assume there is a minimum amount that I should withdraw as an educational assistance payment (EAP) for him. What are my next steps?
–Paul
A. Congrats on thinking ahead, Paul. And you’re correct: There is likely a minimum educational assistance payment (EAP) withdrawal you’ll want to make, which will benefit you both. That amount depends on how fully funded your RESP is.
As a reminder, the EAP is made up of the government grant (up to a maximum of $7,200) and the accumulated earnings on both your contributions and the grant itself…
–Paul
A. Congrats on thinking ahead, Paul. And you’re correct: There is likely a minimum educational assistance payment (EAP) withdrawal you’ll want to make, which will benefit you both. That amount depends on how fully funded your RESP is.
As a reminder, the EAP is made up of the government grant (up to a maximum of $7,200) and the accumulated earnings on both your contributions and the grant itself…