I remember when I was a little girl, every time I received money on a special occasion my parents would take it and tell us they were putting it in our bank accounts for us. I didn’t mind it at all, at that time, because I trusted them, and it wasn’t until I started university that I realized how grateful I was that they saved enough for my education. So parents, this year instead of putting that extra cash into a savings account or using it to buy more toys that won’t be “cool” in a few weeks, this year, why not put it into something much, much bigger.

If you’re not maximizing the annual RESP contribution that will attract the full grant, deposit a lump sum amount into your RESP each year to make up the difference. You are entitled to 20% of your $2,500 annual contribution. You can even “buy back” for any missed years, up to a maximum annual contribution of $5,000 if you have the room.

A lot of parents don’t think about life insurance for their children, but there are huge benefits to starting a policy for your child. You are insuring that they will have protection for their children (your grandchildren), because they will never be healthier than they are today. There are policies, like Universal Life or Whole Life that can grow a tax-advantaged cash value within the insurance policy. Once you transfer the ownership of the policy to your child, there are ways that they can access this cash for things like supplementary retirement savings or a down payment for a home, and still keep their coverage in place.

Critical illness for children is another huge asset that a lot of parents don’t take advantage of. Imagine if your child became critically ill, how would your family’s financial health be affected? Would you be able to continue to work, or would you be using all of your time to take care of your child’s health mentally, physically and emotionally? There are policies still available that you can be paid off in 10, 15 or 20 years, and your child will have this coverage for the rest of their lives. That means that you are now protecting their family’s financial health and you could have only paid for the policy for 10 years. You can customize your policy so that after a specified number of years, if you decided to cancel the policy, you would receive 100% of your premiums refunded to you.

So instead of buying more toys that end up being clutter, why not invest in your child’s future this holiday seasons!

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