RESP / RRSP

RESP is an easy way to save for a child’s future. Planning for a child’s education through RESP contributions is a sound, responsible, simple way to help pay for a post-secondary education. We provide RESP and RRSP Services in Toronto and GTA.

Learn about RESP and RRSP

What is an RESP?

A Registered Education Savings Plan or RESP is a savings vehicle that allows parents, grandparents, friends and other relatives to save for your child or another beneficiary's post-secondary education. An RESP is a way to proactively save money towards your child’s education so that when they’re ready to study, you will be ready to help pay for it. RESPs have an additional feature that makes them unique from other registered accounts because they attract government grants for post-secondary education.

When you invest in a RESP, your net contributions and government grants are invested in fixed-income lower risk securities, typically earning a competitive and consistent return. The goal of this investment strategy is to provide more earning potential by investing the pooled income in a mix of Canadian equities, US and Canadian Exchange Traded Funds (ETFs) and corporate bonds. Select a contribution schedule that's right for you. You can also adjust your contribution amount and schedule at any time.

Find out more information about RESP here. PSS Services provide RESP services in Toronto and GTA.

What is an RRSP?

A Registered Retirement Savings Plan (RRSP) is a retirement savings and investing vehicle for employees and the self-employed in Canada. Pre-tax money is placed into an RRSP and grows tax-free until withdrawal, at which time it is taxed at the marginal rate.1 Registered Retirement Savings Plans have many features in common with 401(k) plans in the United States, but also some key differences.

The growth of an RRSP is determined by its contents. Simply having money in an RRSP is not a guarantee that you may retire comfortably; however, it is a guarantee that the investments will compound without being taxed, as long as the funds are not withdrawn.

RRSPs have two main tax advantages. First, contributors may deduct contributions against their income. For example, if a contributor's tax rate is 25%, every $100 they invest in an RRSP will save that person $25 in taxes, up to their contribution limit. Second, the growth of RRSP investments is tax-deferred. Unlike with non-RRSP investments, returns are exempt from any capital gains tax, dividend tax, or income tax. This means that investments under RRSPs compound on a pre-deferred basis.

Find out more information about RRSP here. PSS Services provide RRSP services in Toronto and GTA.

Why invest in RESP?

We make it easy to start saving for your child's education early and contribute regularly. With our help, you'll have the funds you need, when you need them. Even if your child doesn’t go to a post-secondary institution or use the funds, you can possibly withdraw the money tax free.

The money you contribute and invest grows tax-free within an RESP.

Free money! The government grants provide: up to $7,200 from the Canada Education Savings Grant, up to $2,000 from the Canada Learning Bond

When your child starts receiving payments from the RESP for school, the money will be taxed at their income, and since students have low income, their tax bill will be low.

RESPs have long lifespans. Just because your child might not want to go to school right away, don’t panic, you didn’t save for nothing. RESP accounts can remain open for 36 years, giving kids plenty of time to come around.

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Importance of investing in RRSP early in your career

Contributions in RRSP are tax deductible from your income.

Savings in RRSP grow tax free, you can compound to save more.

You can convert RRSPs to regular payments when you retire.

You can borrow from your RRSP to buy your first home or pay for education.

Did you know?

More than half (56 per cent) of Canadian pre-retirees aged 50 or older don’t have a retirement savings plan, according to research commissioned by the Ontario Securities Commission. This puts a huge burden on your family when you are close to retirement as your income comes to a stand still. Starting an RRSP early can give you peace of mind and you get prepared for retirement. You also pay less taxes for every dollar you contribute to your RRSP.

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