TORONTO, ONTARIO--(Marketwire - Nov 22, 2012) - To mark Financial Literacy Month and Financial Planning Week (November 19th - 25th), BMO Financial Group is releasing a series of financial tips. As part of BMO''s commitment to ''Making Money Make Sense'', the tips are designed to help individuals and families save and manage their day-to-day finances more effectively.
BMO''s Tip of the Day: Save for your child''s education by encouraging friends and family to contribute to a Registered Education Savings Plan (RESP) this holiday season.
With steadily increasing tuition rates, many Canadians are overwhelmed by the task of saving for their children''s post-secondary education. For a child born this year, the projected cost of a four-year undergraduate degree program by the time they head off to university may reach $100,000. That number jumps to upwards of $135,000 if a student chooses a program that isn''t close to home.1
"With the holidays right around the corner, friends and family may be planning on giving your children toys or cash gifts," said Marlena Pospiech, Senior Manager, BMO Wealth Planning Group, BMO Financial Group. "Consider asking them to invest in your child''s future instead and contribute to an RESP. A little goes a long way; compound interest and government grants can yield considerable savings by the time the child is of university age."
For example, as little as $300/year added to a child''s RESP - from the time a child is born until he/she turns 18 - would be enough to cover at least 20 per cent of four years of tuition at a local school.2
"CFEE commends BMO''s ongoing efforts to support Financial Literacy in Canada and promote ways in which Canadians can increase their competence and confidence when managing their personal finances on a day-to-day basis," said Gary Rabbior, President, Canadian Foundation for Economic Education (CFEE).
To learn more about how financial planning can help you feel confident about your future or to contact a financial planner visit www.bmo.com/educationplanning or call 1-888-389-8030.
BMO Financial Literacy Month Tips
November 5: Space out payments to avoid cash-flow problems.
November 10: Understand what you can hold in your RRSP.
November 17: Take advantage of spousal RRSPs.
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a highly diversified North American financial services organization. With total assets of $542 billion as at July 31, 2012, and more than 46,000 employees, BMO Financial Group provides a broad range of retail banking, wealth management and investment banking products and solutions.
1(2010, September 16). University Tuition Fees. Statistics Canada. Retrieved March 12, 2012, from www.statcan.gc.ca
2This is based on the assumption that the $300 a year for 17 years will amount to just under $12,000 (including CESG) with assumed 6 per cent rate of return and annual income of the contributor of $50,000.