There’s no denying that during the holidays, we are part of a family that likes to give. The children are fortunate to receive most of the things on their Santa wishlist, creating a holiday that’s full of Santa Magic. After all, Santa Magic is only here for a handful of short Christmas seasons, so while it is – we want to make the magic now.
Over the past few years, as the kids get a bit older, we’ve started to think about gifts beyond the toys and the ‘stuff’, especially for grandparents that are trying to search for something special. This year, I’ve got the answer: their future. That’s the way that they can make the magic, for later.
RESP Contributions as Gifts
Did you know more than 50% of Grandparents in Alberta say that they have either purchased financial products for their grandchildren, or plan to in the near future? With more and more parents opting to save early for their children’s education, grandparents are seemingly more willing than ever to contribute to these savings, whether through RESPs or through a contribution to their first bank account.
In a survey taken by TD Canada, 63% of Canadian (grand)parents in Alberta who have purchased, or plan to purchase, financial/investment products for their (grand)children say it is to contribute to their education savings.
For children under six, I love the idea of gifting a jar of coins. Taking a bit of time to gather the coins, and sharing with the child the idea of saving up for something important like school, can help to start that dialogue early on.
For children between the ages of six and ten, it’s a great idea to take them to the bank and open an account if one has not been opened already. Starting a dialogue with saving, but also starting to determine the length of time it takes to save compared to the cost of things like everyday items, toys and even the education can help to develop financial understanding.
For children over the age of ten, you can start to get into the basics of how the registered education savings plan works. It’s feasible to start to demonstrate the growth of the education fund, using the statements that arrive in the mail, and directly contribute to the child’s education fund by visiting a branch to make a deposit.