Back to school shopping isn’t just about shopping for school supplies; it’s also the perfect time to plan for your child’s future. As parents, we’re constantly looking for ways to secure a bright future for our children. Alongside academic success, fostering financial literacy is important for preparing them for the journey ahead. At Alterna, we understand parents’ challenges in planning for their child’s financial well-being, and we’re here to make it easier for you.
- RESP: Investing in your child’s education
Did you know that for the 2021/22 school year, tuition alone costed full-time students an average of $6,693 in Canada[i]? Start early saving for post-secondary education by establishing a Registered Education Savings Plan (RESP). With regular contributions, you can maximize the potential growth of your child’s education fund. The government offers grants of up to $7,200[ii] per child to boost your investment. While initial investments are not tax-sheltered like an RRSP, the earnings in the RESP are sheltered until they are withdrawn by the child, often resulting in lower tax rates[iii] due to their student status. At Alterna, we offer various RESP products, including NEI investments, mutual funds, investment portfolios, and our own RESP term deposit.
- Open an Alterna Youth Bank Account to cultivating healthy financial habits
Teaching your child about money and the value of saving is vital. Consider setting up a youth bank account that can help get them on this path. At Alterna, our special youth accounts for children under 18 years old come with no monthly service fees and 30 monthly day-to-day transactions. For post-secondary students, we offer accounts with no monthly fees and unlimited day-to-day transactions, ensuring they start their financial journey on the right foot.
- Enroll in the ‘Save the change’ feature for automatic debit card savings
Saving money doesn’t have to be complicated or time-consuming. With our ‘save the change’ feature, every purchase a child makes using their debit card is rounded up to the nearest dollar, and the difference is automatically transferred to a designated savings account. This painless method makes saving effortless and encourages financial responsibility at a young age.
- Use credit cards wisely
While there are pros and cons to obtaining a credit card at a young age, it can be a valuable tool in building credit and teaching responsible borrowing if used judiciously or in cases of emergency. As parents, we can guide our children in this aspect. One way is to add them as an authorized user to our credit cards, helping them establish a credit rating while keeping a close eye on their spending. Alternatively, assisting them in securing a low-limit credit card can teach them valuable budgeting skills and curb impulse buying tendencies.
As children head back into the classroom this Fall, we’re responsible for teaching and empowering our kids with essential life skills, like budgeting, saving strategies and financial literacy. Alterna is here to support you in this journey by providing expert advice tailored to your child’s individual needs. Together we can teach the next generation to navigate the world confidently and responsibly. Take the next step in securing your child’s financial future.