Before heading to the mall keep in mind that the average Canadian non-mortgage, consumer debt has increased by 2.7 per cent to $20,891. Not to sound all gloom and doom, it is a reality check for you. Have you looked at how much you owe your creditors before you started to spend for the holidays?
According to the 2014 BMO Holiday Outlook Canadians will spend an average of $1,517 this holiday season on gifts, travel, entertaining and decorations.
This is a three-year low for Canadian consumers who have been trying to cut costs due to slower job growth and elevated household debt.
So how do we cut back on spending, have fun, and stress less about money? Why not give the gift that keeps on giving? Instead of lining up at Wal-Mart or Target to buy the most popular Barbie or Lego set, start a Registered Education Savings Plan (RESP) for your child. ? I am talking about quality time with your family and an investment in your children’s future.
The best part about investing in an RESP is that the government will give you FREE MONEY!! Your investment will be eligible for up to $7,200 through the Canada Education Savings Grant (CESG) to help pay for your child’s post-secondary education. You may also be eligible for up to $2,000 through the Canada Learning Bond (CLB) for your child’s RESP without having to put in any of your own money!
We are too easily caught in the holiday shopping slump, wondering what to buy this year that will not end up broken and ignored at the bottom of the toy box. Let’s be honest, your kids probably already have Barbie or Lego gathering dust somewhere in your home. If you buy them another expensive trendy toy, there will always be a newer and better version advertised on television the very next week. An RESP is something that you can contribute to each and every year, and the grandparents can get in on the action too! Anyone can open an RESP for a child.
Over the holidays give the gift of time spent together as a family. Go outside and build a snowman, go sledding or skiing or curl up by the fire with a hot cocoa and play cards or a board game with your kids. These memories will last forever and your savings will grow tax-free for your children’s futures.
Leah Drewcock, CIRP
