THUNDER BAY – BUSINESS – Can I really get free money? It almost sounds unbelievable. However there are incentive programs available for all of us to take advantage of. Here are a few.
An employer matched retirement plan
Many employers are getting away from defined pension plans and are moving towards defined contribution plans. If your employer is offering a defined contribution plan, you should take advantage. Your employer may match your $1 for their $1 or even $0.50 on your dollar. Either way, it’s free money to you just for saving for your future. Here is an example of how it works using a $1 for $1 match. Assuming you have bi-weekly income of $1,000 and are able to contribute a maximum of five per cent. You would contribute $50 from your cheque, and they would match $50. By contributing into their plan, you’re giving yourself a raise in the process.
Setup a registered education savings plan for your family
The cost of education has been steadily rising over the past few decades. Registered education savings plans (RESPs) are a good way for you to save for your children’s education. The incentive to start a plan is that you can receive government grants to help pay for it. By contributing the maximum contribution of $2,500, you can receive up to $500 in grants annually up to a maximum lifetime limit of $7,200. It’s very easy to get started.
Setup a registered disability savings plan for a beneficiary
A registered disability savings plans (RDSP) could be a great way for parents and others who have someone they care for save for the long-term financial security of a person who is eligible for the disability tax credit. Depending on the beneficiary’s family income and the amount contributed, the government will match up to 300 per cent annually. Between the Canada Disability Savings Grant, and the Canada Disability Savings Bond, the RDSP plan can get up to $4,500 annually, and up to $90,000 over the beneficiary’s lifetime.
The bottom line
If you’re able to take advantage of any of these plans, it may be beneficial to do so. If you’re one who has questions about getting started with these plans, please contact me to get started.
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Anthony M. Talarico is a financial security advisor with Freedom 55 Financial, a division of London Life Insurance Company, and an investment representative with Quadrus Investment Services Ltd. He can be contacted at 807-343-4788, ext. 4248, or by email to firstname.lastname@example.org