Saving for post-secondary education now easier for parents in Quebec: Fidelity now offers the Quebec Education Savings Incentive (QESI)
MONTREAL, April 22 /CNW/ - Saving for post-secondary education just became easier for parents in Quebec. Starting today, parents, grandparents and others can now receive a Quebec Education Savings Incentive (QESI) for their children's or grandchildren's education savings program through Fidelity Investments Canada ULC. Fidelity is one of the first major mutual fund companies to make the QESI available to eligible Fidelity Registered Education Savings Plan (RESP) accounts.
"Opening a Registered Education Savings Plan is an important first investment in your children's future. Fidelity is pleased to be one of the first major mutual fund companies to offer the QESI for parents in Quebec," said Charles Danis, Vice President, Regional Sales, Fidelity Investments Canada ULC.
The QESI is a program made available for RESP clients who reside in Quebec. The Quebec government established the QESI in February 2007 to provide assistance to Quebec families to help them save for their children's education. The incentive is comprised of a refundable tax credit paid directly into the RESP of qualified Quebec residents. An additional credit will be available for families that meet certain family income criteria.
"Tens of thousands of dollars are available to parents through federal and provincial educational granting programs," said Danis. "By the time your child is ready for post-secondary education, parents could realize over $25,000 in savings all without spending a penny of their own. Plus, your investment in your child's future is fully tax-sheltered."
How to save with Fidelity
Parents can save a significant amount for a child's post-secondary education just by investing the Universal Child Care Benefit (UCCB) and making use of other government grants such as the QESI and the Canada Education Savings Grant (CESG). For example, every month, until a child reaches the age of six, parents receive the Universal Child Care Benefit of $100. Parents can arrange to have that amount automatically invested in a mutual fund within their child's RESP. By contributing the UCCB every month for six years, parents will have put aside $7,200 in savings.
Additionally, the CESG provides a grant of 20 cents for every dollar invested. This will provide $1,440 in savings over this same period. Finally, the QESI adds $720 in savings to parents. After 18 years of dedicated investing, using a mutual fund earning a consistent 7% per annum return, parents could have $26,553 in savings - right on time for your child to start their post- secondary education program.*
Come save with Fidelity
Fidelity has applied for unclaimed QESI grants retroactive up to three years for eligible RESP account holders who made regular contributions in 2007, 2008 and 2009. Additionally, the 2010 Federal Budget put rules into place to ensure that both levels of the savings and granting programs available to RESPs are synchronized. Parents and grandparents can now maximize both provincial and federal granting systems with this rule clarification.
"Parents should speak directly with their investment advisors regarding how to open a RESP at Fidelity and how it can help them save for their children's education. And once a qualified RESP account is opened at Fidelity, we will automatically apply for the QESI grant on behalf of the beneficiary," said Danis.
What is a RESP and what does a Fidelity RESP offer?
A Registered Education Savings Plan (RESP) is a special savings account that can help parents, grandparents or family friends start saving now for their child's post-secondary education. RESPs are registered by the Government of Canada so savings for education can grow tax-free until the person named in the RESP enrolls in studies after high school.
RESPs provide tax advantages to help you fund your child's post-secondary education.
- For every dollar contributed, 20 cents of Canada Education Savings
Grant (CESG) is added (subject to annual and lifetime maximums).
- Additional provincial incentives available for Quebec and Alberta
- Savings grow tax-deferred.
- When your child begins post-secondary education the money is
withdrawn in your child's name. These amounts may be taxed at the
lowest rate - or not at all.
How to open a RESP at Fidelity
It is easy to open a RESP account at Fidelity. The first step is to get a Social Insurance Number (SIN) for your child. Fidelity offers free administration on all RESP accounts and a large selection of award-winning Fidelity mutual funds to invest in. Parents should speak directly with their investment advisors regarding how to open a RESP at Fidelity and how it can help them save for their children's education.
About Fidelity Investments
Fidelity Investments Canada ULC is the country's sixth largest mutual fund company and part of the Fidelity Investments organization of Boston, one of the world's largest providers of financial services. In Canada, Fidelity manages over $56 billion in mutual fund and institutional assets. This includes $10 billion in assets for institutional clients including public and corporate defined benefit pension plans, endowments, foundations and other corporate assets on behalf of clients across Canada.
Fidelity Canada provides Canadian investors a full range of domestic, international and income oriented mutual funds. Fidelity funds are available through a number of advice-based distribution channels including financial planners, investment dealers, banks, and insurance companies. Fidelity is a proud supporter of the Boys and Girls Clubs of Canada and we are dedicated to helping young Canadians realize their full potential as productive, responsible and caring citizens.
* Source: FMR LLC. Assumes investment of the full Universal Child Care Benefit (UCCB) of $100 a month for 72 months, and a consistent 7% per annum return, compounded monthly. The CESG is calculated using 20% of the annual contribution and QESI is 10% of the annual contribution, into the RESP for six years.
SOURCE Fidelity Investments Canada Limited
For further information: For further information: Chris Pepper, Director, Corporate Affairs, Office: (416) 307-5388, Mobile: (416) 795-7762, Email: email@example.com