Education funds across countries
June 10, 2024 9:15 AM   Subscribe

My husband and I would love to start education funds for our niece and nephews. We are in the US, his family is in Canada (Quebec specifically). We're happy to set aside the money in a regular ol' account here, but maybe there's a better way? I don't believe the parents have this figured out on their end yet, but if there's a way for us to contribute to something they'd need to open, we're totally happy with that too. Anyone familiar with what our options may be?

We don't have kids ourselves, our own savings are completely taken care of, and we already ran this idea by the parents and got their blessing. Just need to figure out where to go from here!
posted by It Was Capitalism All Along to Education (8 answers total)
Canada has RESP which is registered education savings plan; the government of Canada adds money to it as well. Have the parents set it up (just need child SSN) and then you can deposit money into it.
posted by St. Peepsburg at 9:18 AM on June 10 [4 favorites]

More details on above: the money grows tax free! That’s the big advantage.
Have the parents set up a family plan so the money can be shared by all kids (if one kid needs more/less funds than the other).

Anyways that’s your search term: RESP
posted by St. Peepsburg at 9:20 AM on June 10 [2 favorites]

Thirding RESP!
posted by Kitteh at 9:26 AM on June 10

About RESPs: it's not quite true that the growth is fully tax-free. But the trick is that, when the funds are used for college, they are considered income for the student, so the growth is taxed at their income level, not yours. The contributions are after-tax, so the tax is only on the growth.
posted by number9dream at 9:48 AM on June 10 [2 favorites]

If the parents have US citizenship, there’s likely no advantage to an RESP
posted by congen at 10:16 AM on June 10

Response by poster: Thanks so much folks! Sounds like the parents have a meeting with a financial advisor later this month, so the topic will be brought up then too.

Also to clarify, husband and I have US citizenship but the parents and kids are Canadian, so RESP definitely seems like the way to go.
posted by It Was Capitalism All Along at 10:34 AM on June 10

Following as I am also in the same situation (US Citizen, but my nieces are Canadian). Is it truly as simple as us being able to make deposits from a US bank account into their RESP?
posted by something_witty at 2:56 PM on June 10

If the parents have US citizenship, there’s likely no advantage to an RESP

The RESP would still receive the 20% grant match to 2k a year.
posted by Mitheral at 3:57 PM on June 10

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