2018 RRSP Reminder and Updates for 2019 RRSP, TFSA & RESP

Jeff Scruton - Feb 08, 2019

RRSP

Friendly reminder that the deadline to make your 2018 RRSP contribution is Friday, March 1st.  There are a few ways to make a contribution:

● Cheque mailed to our attention - must be received by end of day on March 1st.
● Electronically, via online banking.
● Set up Canaccord Genuity as a bill payment and use your 8-digit, alphanumeric account number.  Note that it must come from a bank account with a matching name.
● Electronically, via one-time EFT(electronic funds transfer).

        ○ This can be initiated/requested on our end using this form.
● Set up on a recurring basis to take advantage of dollar-cost-averaging.
Please see here for all the necessary RRSP admin, including:
       
○ Contribution limits (including 2019, if you want to get started early).
        
○ Tax considerations.
        
○ Wind-down options at age 71.

TFSA

● Note that the annual TFSA limit has increased for 2019 to $6,000, from $5,500 in 2018.  This brings the total available contribution room to $63,500, for those that were 18 as of 2009.
● The TFSA contribution schedule is based on the calendar year, so contributions for 2019 can start as of January 1st and end on December 31st.  However, note that TFSA room is cumulative and past room can be made up any time.  

RESP

● 2019 RESP contributions can be made as of January 1st, and similar to TFSAs, run on the calendar year, and have a deadline of December 31st.
● The government provides a grant of 20% of contribution amounts, to a maximum of $500 per year and a lifetime maximum of $7,200 per beneficiary.  So, in order to maximize the grant, the annual contribution amount would be $2,500 per beneficiary.
● Past grant room can be made up, but only until the beneficiary is 17 and only one year of grant room can be made up in any one calendar year.

● RESP rules can be fairly technical, so please contact us for more information, as well as strategies that may make sense, such as:
        
○ What contribution strategies will produce the best outcome, such as front-end loading.
        
○ Benefits of Family RESPs with multiple children/beneficiaries vs. individual plans.
        
Joint ownership vs. individual.

Financial Planning

There are many strategies that can be used with RRSPs, TFSAs and RESPs.  These structures are tools that can be leveraged to enhance your wealth and create efficiency to better achieving your goals.  However, there are certainly also pitfalls to be aware of.
Proper use of these tools should always be done in the context of a thorough financial plan.  

Please contact us to coordinate a discussion to determine how these tools can be used to enhance your wealth.

Sincerely,

Jeff Scruton