Q & A on RESPs

by Maxine
Posted July 31 2010 10:49am
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For many parents the last thing they are thinking about when they gaze at their newborn is the cost of raising this baby. Thinking about this baby going off to college or university is far from their minds. Yet, planning while your baby is young can result in significant savings. Registered Education Savings Plans (RESPs) can help. The Government of Canada allows savings in these accounts to accumulate tax free until your child enters post-secondary education. The government also helps with special incentives such as the Canadian Education Savings Grant and the Canada Learning Bond. An RESP is one way that you can save for your baby’s future school costs.

The following is a series of Q & A’s about RESPs.

  1. What is an RESP?
  2. Why do you need an RESP for your child(ren)?
  3. What do I need to open an RESP for my child(ren)?
  4. How do RESPs work?
  5. How to Choose a Broker
  6. Can I open an RESP for a teenager/older child?
  7. How much will the Government contribute to my child’s future?
  8. What happens when my child is ready to use their RESP?
  9. Checklist before opening an RESP
  10. Top 10 Reasons to open an RESP

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Returning to Work Later

by Maxine
Posted September 5 2011 02:23pm
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The decision's been made—one or maybe both of you will return to work later than planned. Some parents are totally unprepared for just how protective and deeply attached they become to their baby. Others discover deep fears about leaving their baby with non-family caregivers. Many parents experience a huge shift in their priorities once the baby is born, compared to their plans when they were expecting their baby.

What can influence one or both of you to return to work later than planned? Our experts have created a list of some of the common reasons that parents choose to stay home longer:

  • Time spent at home wasn't as bad as you thought it would be
  • Time with your baby flew by
  • Financial security
  • Discovering that spending more time at home may be good for both you and your baby
  • Childcare arrangements aren't working out or there is some concern about the quality of your child's care
  • High expense of infant care, which leads to the decision to wait until your baby is a toddler, when cost will be considerably lower

When you are considering staying home longer, sit down together and discuss the changes you’d like to make and develop a revised plan together.

Be sure to notify your employer as soon as possible. Your decision will influence their human resources and budget issues, such as the arrangements to keep or find another substitute for you. Have a plan in place if your employer pushes back and does not want you to extend your leave. Know how you want to handle this before you talk to them.

You should also talk to any childcare providers you may have lined up and negotiate with them about delaying your baby’s entry into their care. You want to ensure that when and if you make the decision to return to work you have quality childcare lined up.

Did you extend your maternity or paternity leave? How did your employer handle the request? What advice would you give to other parents in this situation? Leave a comment below and share your experience!

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What is an RESP?

by Maxine
Posted August 1 2010 12:17am
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An RESP (Registered Education Saving Plan) is a registered savings account with the Government of Canada that allows parents to save money for their child’s education after high school. The interest on the money is not taxed until it is taken out of the account, (unless you contribute more than $50,000).  When the RESP funds are withdrawn to pay for tuition, the money is taxed to the student and not to the parent. Since most students have little or no income they will likely pay little to no taxes on this money.

If your child decides not to continue his or her education past high school, the money in an RESP can be transferred to another beneficiary (a younger child, for example) or, in some cases, it can be transferred into your Registered Retirement Savings Plan. The funds can also be withdrawn, but taxes will have to be paid on the accumulated interest. Any government grants you have received on the money will be returned to the government.


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Returning to Work Worksheet: Dilemmas and Decisions

by Maxine
Posted September 5 2011 02:33pm
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In about 75% of couples, both partners are employed full-time just before the birth of their first child. Roughly 65% of moms and 85% of dads with children under 3 years of age are in the labour force. It's clear that most couples re-enter the workplace after their baby is born.

Typically, women who work for pay will take some time off, if not before, then certainly after the birth of their babies. In many cases, moms receive some level of maternity/parental leave benefits through their employment. Plus these days, more and more dads are now using parental leave, too.

With up to a full year of formal maternity/paternity leave being available to many parents, there are a number of variations to the decisions that you can make, including the following:

  • Do you ever intend to work for pay after your baby is born?
  • Will you both share the parental leave?
  • How much time will each of you take?
  • Will the one of you on leave take the full leave?
  • Will you return to work on a part time basis?

Experts agree; if your baby has good, high-quality care—whether from Mom, Dad or a non-parental caregiver—any of these solutions can be good for your baby. You need to find the solution that best suits your unique situation and feel confident in your decision.

Read our articles on Not Returning to Work, Returning to Work Early and Returning to Work Later for more information.

Making your Decision

Need some help to make your decision on when to return to work? The Return to Paid Work Worksheet below contains some questions that may help you figure out what to do.

Download the Returning to Paid Work Worksheet (PDF)

Did you decide to return to work or stay home? What influenced your decision? Share your experience by leaving a comment below!

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