YOUR TIME OF LIFE

November 2014

INVEST IN YOUR CHILD’S FUTURE THROUGH A REGISTERED EDUCATION SAVINGS PLAN

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*Source: 2013 Statistics Canada

High school University

Avg. annual salary $76,000*

vs.

Avg. annual salary$48,250

POST-SECONDARY EDUCATION HAS A GREAT IMPACT ON YOUR CHILD’S FUTURE

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Source: Statistics Canada

Canadian average 90/91 = $2,243Canadian average projected 16/17= $6,842

AVERAGE TUITION COSTS HAVE MORE THAN TRIPLED SINCE 1990

0 2,000 4,000 6,000 8,000 10,000

Newfoundland & Labrador

Prince Edward Island

Nova Scotia

New Brunswick

Quebec

Ontario

Manitoba

Saskatchewan

Alberta

British Columbia

Canadian average

Current $

1990/1991 2016/2017

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Scholarships?

Student loans?

The lottery?

HOW WILL YOU PAY FOR YOUR CHILD’S EDUCATION?

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• Scholarships: two-thirds of parents believe their children will be partially funded by scholarships/awards, when only 31% of students between ages 18 and 20 actually receive them*

• Student loans: more than 90% of parents expect their children to get student loans – despite the fact only 50% qualify*

*From the book The Debt-Free Graduate by Murray Baker

PAYING FOR SCHOOL, THE REALITY

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RESPs CAN HELP YOU TO MAXIMIZE MONEY AVAILABLE FOR YOUR CHILD’S SCHOOLING

RESP facts:

• Lifetime contribution limit $50,000 per beneficiary

• Money inside an RESP grows tax-free until it’s withdrawn by your children

• Withdrawals are taxed in your child’s hands, not yours

• The Government of Canada offers “free money” to help you save through the Canada Education Savings Grant and other government programs

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CANADA EDUCATION SAVINGS GRANT (CESG)

• Basic grant of 20% on the first $2,500 contributed into an RESP each year for a total of $500 per year

• Basic lifetime maximum of $7,200

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GROW YOUR RESP FASTER WITH THE CESG

Investment of $150 a month for 18 years(CESG = $360/year)

The graph above assumes an annual compound growth rate of 7% and that the CESG is paid as a lump sum to the account an the end of each contribution year. This illustration is not intended to reflect future value of any mutual fund or returns on investment in any mutual fund.

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ADDITIONAL EDUCATION ASSISTANCE

Provincial:

• Quebec – provincial grant equal to half of CESG

• Saskatchewan Advantage Grant for Education Savings (SAGES) – 10% matching grant up to $250 per year or $4,500 lifetime per beneficiary.

For modest-income families:

• Additional CESG – qualifying families can receive up to $600 per year (up to $100 more than basic amount of $500)

• Canada Learning Bond – families receiving National Child Benefit Supplement. An initial CLB grant of $500 for children born Jan. 1, 2004 or later, and $100 per year of eligibility until the child is 15

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TOP 5 RESP TIPS

Talk to your financial advisor about whether an individual or family RESP is more appropriate

Take advantage of carry-forward CESGs

Consolidate your RESPs

Don’t withdraw your contributions from an RESP

Have a back-up plan in case your child does not attend university or college

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RESOURCES TO HELP

Ask your advisor for these helpful guides.

Or visit mackenzieinvestments.com/resp

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START CONTRIBUTING NOW

• Start by getting a Social Insurance Number for your child

• Apply for the CESG by simply filling out the CESG application form

• Parents, grandparents, relatives and friends can contribute

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HOW MUCH MONEY CAN I SET ASIDE FOR MY CHILD?

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RAISING FINANCIALLY LITERATE TEENS

This program can help you teach positive money habits to your kids

Ask your advisor for a kit.

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DISCLAIMER

Commissions, trailing commissions, management fees and expenses all may be associated with mutual funds. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.