Author Topic: Canadian investing  (Read 2851 times)

going2ER

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Canadian investing
« on: March 21, 2014, 11:10:38 AM »
We are in the process of selling a property and I would like to invest some money for my children to give them at a time I feel is appropriate, maybe once student loans become due, they are buying a home, etc.

Oldest is 20 and in her second year of university, she has no student loans yet, it is all bursary, scholarships, family contributions and savings from her summer job. Middle is 16 and in high school, likely to attend university, works part time. Youngest is 10, in elementary school and currently wants to be an electrician, but that will likely change, also has a learning disability and does not like school so unlikely to pursue a university degree.

I am looking for the best return for this money so any suggestions on where to invest it would be great. I am also uncertain if I should invest it in a lump sum, then when first child gets hers give her 1/3 of the current value, second child would then get 1/2 of the value at her appropriate time and youngest would get what is left at the end. Or should I invest in 3 separate accounts? I say that they are not likely to fight over who got how much knowing that it was all invested at the same time even though when oldest gets hers it is less likely to have grown as much as when youngest gets his.

Any suggestions on how to do this?

Prairie Stash

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Re: Canadian investing
« Reply #1 on: March 21, 2014, 11:36:36 AM »
RESP - $2500/year with the feds giving a match of 20%.  You can also retroactively claim for last year.

For the oldest and middle this is ideal. $5000 (this year and last years contribution) turns into $6000.  The catch is they must go to post secondary or the money goes back to you. RBC or any bank can set this up for you.

For the youngest, if she takes a trade school RESP will work.  Otherwise think about a Plan B.

MorningCoffee

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Re: Canadian investing
« Reply #2 on: March 21, 2014, 11:50:13 AM »
RESP grants are only available until age 17. See the link below.

http://www.canlearn.ca/eng/savings/cesg.shtml

Wannabe Mustache

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Re: Canadian investing
« Reply #3 on: March 22, 2014, 06:25:01 AM »
I am no expert but I've found some good websites/blogs that might help you out.

I know you won't be able to control their money once you give it to them but maybe if it's in a good investment and they understand compound interest they might see that it might be better to keep it there (in a tax sheltered account like an RRSP) than to use it for debt repayment or house down payments (read some of the threads about those topics).

This site is American but really good - http://jlcollinsnh.com/2011/06/08/how-i-failed-my-daughter-and-a-simple-path-to-wealth/

http://youngandthrifty.ca/

http://canadiancouchpotato.com/

Also check out moneysense magazine. 

Prairie Stash

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Re: Canadian investing
« Reply #4 on: March 22, 2014, 07:28:55 AM »
RESP grants are only available until age 17. See the link below.

http://www.canlearn.ca/eng/savings/cesg.shtml
Thank you, good point on oldest child. For the middle and youngest it still works.