A PARTNER YOU CAN TRUST.

WHO CAN HELP YOU SAVE FOR YOUR CHILDREN’S EDUCATION?

Would you like to ensure that your children or grandchildren have the necessary financial resources to go to university?

Studies shows that a post-secondary education and training are increasingly important.

In the 2000s: ◦ 65% of new jobs, or almost 2 out of 3, will require a

post-secondary education.

Source: Statistics Canada

Choice #1

Choice #2

Choice #3

Tuition /Program Fees $21,450 $31,353 $18,972

Compulsary Fees :

Athletic Fees $0 $237 $246

Health Services Fees $1,011 $342 $468

Other Fees $777 $744 $573

Student Association Fees $408 $336 $384

Books $2,613 $2,613 $2,613

Supplies $360 $360 $360

Total Cost $26,619 $35,985 $23,616

These amounts do not include

lodging fees

In fact, full-time students in Canada paid $14,500 on average to cover a year of post secondary expenses in 2003-2004. That's roughly $58,000 for a four-year program.

Source:CanLearn

First three years of medicine, starting in 2008, dependent single student

Let your children go into debt to pay for their education Pay or borrow the amounts required while your child is

at university Save now and be able to offer this opportunity to your

child later on.

The solution?

The Registered Education Savings Plan, commonly known as the RESP, is the best solution to save for a child’s education.

Anyone can open an RESP:

Whether you’re parents, grandparents, legal guardians, family members or friends, you can open an RESP and offer a gift to a child!

In addition, when you open an RESP, the child will receive a lovely certificate explaining that someone close to them is taking care of their future.

◦ To save for your children’s education◦ To take advantage of the Education Savings (CES) Grants◦ To accumulates in a tax sheltered plan◦ To access your contributions◦ To invest in high-performance investments

The RESP is registered with the government of Canada so that the money saved for school can grow tax-free, until the person designated as the RESP beneficiary enrolls in a post-secondary school.

How much can I save? For all RESPs for the same beneficiary:

◦ Per year: No annual plan contribution limit

◦ Lifetime limit for the plan: Maximum contribution plan limit of $50,000

For how long? Contributions can be made up to the plan’s 31st anniversary

◦ Plan duration: 35 years

Once your RESP is opened, you have many investment possibilities: ◦ Guaranteed rate fixed-term investments◦ Mutual funds:

Bonds Canadian equities U.S. and international equities

Our RESPs also include a guarantee for sums invested

Since 1998 (or the year of the child’s birth)

◦ Each child accumulates $400 (prior to 2007) or $500 in grant room per year. Thereafter, regardless of whether or not an RESP is open in the child’s name.

1998 2007

$400 / year $500 / year

Net family income* lower than $38,832

Net family income* between $38,832 and

$77,664

Net family income* over $77,664

Main federal grant

• 20% on the first $2,500 contributed (since 2007)• 20% on the first $5,000 if accumulated room

20%

20%

20%

Additional federal grant• on the first $500 contributed only

20%

10%

CLB• Child born after January 1, 2004• Grant not related to contributions

$500 (first year) $100 thereafter

ACG (Alberta only)• Child born in 2005 or later• Grant not related to contributions

$500 (first year) or,

$100 (age 8, 11 and14)

$500 (first year) or,

$100 (age 8, 11 and14)

$500 (first year) or,

$100 (age 8, 11 and14)

QESI (Quebec only)• 10% on the first $2,500

10%

10%

10%

Enhanced QESI (Quebec only)• Applicable on the first $500 of contributions only

10%

5%

* Family income for

2009 – Income bracket revised

annually

Accumulated income on contributions and on grants:Non-taxable as long as there are no surrenders

◦ Will be taxable to the beneficiary when Educational Assistance Payments (EAP) are made (as income).

If the child doesn’t go to university:◦ Will be taxable to the subscriber when Accumulated Income

Payments (AIP) are made.

Contributions: Surrenders are non-taxable

SubscriberParents; Grand-parents

BeneficiaryChild; Grand-child

•Maximum contribution period = 31 years•Maximum duration = 35 years

Opening of plan

End of contributions Close of plan

Year 0 31 35COTISATIONS

Investment in an RESPInvestment in an RESP

Deposit: $2,000/year

Interest rate: 6%

Taxation rate: 50%*

Non-registered RESP RESP+ CES grant

MY EDUCATION DIPLOMA

Offered as an individual or family plan Minimum deposit of $100 Minimum PAC of $25 ($10 per beneficiary for the family

plan) Investment funds available

MY EDUCATION

Flexible contributions allowed Eligible to government grants No annual contribution required Access to your capital at all times Tax-free withdrawal of contributions Possibility to change the plan’s beneficiary at any time

ADVANTAGES

Offered as an individual plan only Minimum mandatory PAC of $25 per month until

December 31 of the beneficiary’s 17th birthday Minimum lump-sum deposits of $100 Pre-determined investments

DIPLOMA

Offer an education bonus of up to 15% of the contributions to the RESP will increase the income paid for education

Eligible to government grants

Access to your capital at all times

Withdrawals of contributions are tax-free

Possibility to change the plan’s beneficiary at any time

ADVANTAGES

0 18

$100 x 216 months (18 years) x 15%

(bonus according to age) = $3,240

$100/month$100/month

Years

You would like to increase your contributions, but your current budget does not allow it.

Here is a solution that lets you increase the amounts available in your RESP and receive the maximum government grant, while staying within your budget!

RESP LOAN

Available for an amount equal to your contract’s current contributions (up to 100%)

No interest or repayment required until the end of the plan◦ However, it can also be repaid at any time

Available for an amount equal to your contract’s current contributions (up to 100%)

No interest or repayment required until the end of the plan◦ However, it can also be repaid at any time

How it WorksHow it Works

Your contribution: $1,000 $200

Your RESP loan: $1,000 $200

$2,400

By depositing $1,000, you obtain a $2,400 investment for your child’s studies!

RESP GRANT

No annual fees

Financial institutions and fund companies

Annual administration fee (between $25 and $50)

IA RESPs

EAP eligibility in the first study session, with proof of registration

EAP determined by the subscriber

Possibility of AIP

Scolarship Plans

EAP eligibility in the second year of studies and at age 19, with proof of school success

EAP determined by the foundation

Accumulated income paid to the foundation

The advantage of an IA RESP: FLEXIBILITY

DIPLOMA and MY EDUCATION

EAP: Educational Assistance PaymentsAIP: Accumulated Income Payments

For the 20% (or more) grant For the education bonus of up to 15% (Diploma) For tax-sheltered accumulation To maximize the grant through the RESP loan To diversify your investments (My Education) For the flexibility of changing beneficiaries For the possibility to transfer investment income to your RRSP, if

your child does not pursue a post-secondary education

THE RESP is the ideal

savings vehicle for

children’s post-secondary education!

THE RESP is the ideal

savings vehicle for

children’s post-secondary education!