Saving for Education and Retirement



Saving for Education and Retirement

1. Education: Gathering information about RESPs

Use your own words to answer these questions.

Research background information

• What is an RESP?

• What are the benefits of saving money in an RESP?

• Where can you open an RESP?

• What is a qualifying educational program?

• What tax rules apply to an RESP?

Research contribution rules

• Who can contribute to an RESP?

• What is the maximum lifetime contribution allowed?

• How much money does the government contribute to an RESP?

Research withdrawal rules

• How is money withdrawn from an RESP when the student starts post-secondary education?

• What happens to the money in the RESP if the student decides not to pursue post-secondary education?

2. Retirement: Gathering information about RRSPs and RIFs

Use your own words to answer these questions.

Research background information

• What is an RRSP?

• What are the benefits of saving money in an RRSP?

• Where can you open an RRSP?

• What tax rules apply to an RRSP?

Research contribution rules

• Who can contribute to an RRSP?

• How often and how much can a person contribute to an RRSP?

• For how long can a person contribute to an RRSP?

Research withdrawal rules

• What happens when a person needs some of the money saved in an RRSP for an emergency?

• What do you do with the money when you retire?

• What is the difference between an RRSP and a RIF?

3. Using online financial calculators

Many financial institutions offer online RLSP, RRSP, and RIF calculators.

Find an RESP calculator

• What information does the calculator require?

• Try some sample calculations.

• Record or print the calculator screen.

Find an RRSP calculator

• Think of the largest contribution you can afford to make every month from age 18 to age 65. What will be the amount of these contributions when you retire? Use realistic interest rates.

• Investigate how the amount at retirement changes if you:

- Double your contributions

- Wait 10 years until you start contributing

• Record or print the calculator screen.

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