Transcript A unique segregated fund RESP

REGISTERED EDUCATION SAVINGS PLAN
Introducing A Unique Segregated Fund
RESP
Dramatic increases in cost of
higher education are
anticipated …….
Diploma segregated fund
RESP..
 A unique investment vehicle which provides
the opportunity to invest in a child’s future.
 Advantages:
 Tax-sheltered investment income
 Canada Education Savings (CES) Grant : 20
Plus…...
%
Some standard
RESP
information...
Maximum
contributions...
Annual:
$4,000
Lifetime:
$42,000
Maximum per
beneficiary for all RESP’s
The CES Grant.
The amount of the Grant:

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
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20% of the annual contributions
$400 annual maximum
$7,200 total maximum
Paid monthly by the Federal Government
Tax deferred until the amounts are withdrawn
Unused rights can be deferred
Who can susbcribe to
a
Diploma RESP?
• Any person of legal age (not a company or a
trust)
• Only one subscriber per contract, is permitted
• The subscriber can contribute to several
RESPs at the same time
Diploma : who can be
designated as a beneficiary?
• Any child 14 years of age or less
• Need not be related to the subscriber
• There can be only one beneficiary per contract
(individual plan)
• The beneficiary can be changed at any time
• The beneficiary can be the beneficiary of more than
one RESP
Accumulation…..
The accumulation in
Diploma is made up of...
Contributions
The 3 types of
Contributions:
PAC contributions up to the
beneficiary’s age 18*
 Minimum : $25 per month
 No enrolment fees
Contributions
Additional deposits are possible;
Transfers from other plans are
welcomed.
* until December 31 of the year in which the beneficiary reaches age 17
The accumulation in Diploma
is made up of...
Grants
Contributions
The accumulation in
Diploma is made up of...
Investment income
Grants
Contributions
The accumulation in Diploma
is made up of...
Education bonus
Investment income
Grants
Contributions
Exclusive to Diploma
The Diploma Education Bonus.
 % of the total PAC contributions;
 A one time payment at the end of
the commitment period.
Beneficiary’s
Education
age at issue
bonus
% of PAC
0-4 years
15.0%
5
13.5%
6
12.0%
7
10.5%
8
9.0%
9
7.5%
10
6.0%
EG: Child Age 0 yrs @ $100per month
Deposit: $100 X 12 X 18 years= $21,600
Bonus: $21,600 X 15% = $3,240
The Diploma Education Bonus
cont...
Beneficiary’s
age at issue
Education
bonus
% of PAC
11
4.5%
12
3.0%
13
1.5%
14
1.0%
Investment Fund
An index type of investment fund
MSCI EAFE
International
Stocks
US Stocks
S&P 500
10%
25%
40%
25%
Canadian
Stocks
S&P TSE 60
Canadian Bonds
« B » Fund
Insurance Riders

Two choices :
- CID : disability protection
- CIDE : death protection

Subscriber = insured

Benefit : monthly PAC premium
The educational
assistance
payments
When the subscriber requests the Educational
Assistance Payment (EAP) for the beneficiary:
Education bonus
Investment income
EAP for the beneficiary
Grants
Contributions
The subscriber can
withdraw contributions
Eligibility to receive the EAP:
1. The beneficiary must be a full-time student in a postsecondary educational institution;
2. Most colleges and universities qualify;
3. Program must be of a minimum duration of 3
consecutive weeks.
The Diploma Educational
Payments.
 Great flexibility of EAP payments;
 The frequency and the amount of the
payments are at the discretion of the
subscriber;
 Maximum for the first 13 weeks: $5,000;
 There is no restriction in the amount payable
after the first 13 week period.
For more information and enrollment,
please contact us:
Tel: 239 3850
E-mail: [email protected]