1) Having children requires considerable financial planning and expenditure to meet their present and future needs from diapers through education. This includes providing for their care and protection if you become unable. 2) Government programs can help with costs like maternity leave, child care, and education savings but have income limits. Life insurance and disability coverage are important to financially protect your family. 3) Housing and school choices are major decisions as children grow. Saving early in registered education savings plans maximizes benefits and financial aid eligibility for post-secondary education. Comprehensive financial planning is important every step of the way.

1. portion can be carried forward or, Although you should review your
within limits, be transferred to parents estate plan regularly, you will particu-
or grandparents. Interest paid on larly need to do so now. This is
student loans will also generate a because your personal and financial
tax credit. situation changes direction dramati-
There is no federal tax credit avail- cally once children enter the picture.
Jaffer Hussain able for private primary or secondary In addition to the possible changes
school tuition, though some religious in your will, and in re-designating
Consultant
schools can provide charitable dona- beneficiaries for your investments,
jaffer.hussain@investorsgroup.com
tion receipts for part of the amounts your estate plan may now require the
(416) 659-5140
paid. Private schools may be able purchase of life insurance to meet
to provide receipts for part of the your objectives of providing an
fees that represent child care such income stream to a surviving spouse
as school lunches or postschool or guardian. Your estate plan should
child care. be developed in consultation with
your accountant, lawyer and your
Investors Group Consultant.
Wills and Estate Planning
Since there are set-up costs and
Your will likely requires revision
administrative costs involved in trusts,
now that you have children. This
your Investors Group Consultant can
may include the appointment of
explain how trusts can be used as part
trustees to administer any testamen-
of your overall estate plan, and can
tary trusts established through your
work with your lawyer to recommend
will, and guardians for your minor
the best structure for you.
children. These persons should be
individuals worthy of trust and able
to carry out the job required.
* CES Grant is provided by the Government of Canada
SPECIAL REPORT
Investors Group Financial Services Inc.
Most parents will tell you having
children is the most rewarding Raising a family:
and challenging experience life
Suite 701
305 Milner Avenue Raising a family: from diapers to diplomas is published by Investors Group Financial Services Inc. (in Québec, a financial has to offer. 3 from diapers to diplomas
services firm). Head Office: 447 Portage Avenue, Winnipeg, Manitoba R3C 3B6. 1-888-746-6344. Québec Office:
Toronto, ON 2001 University Street, Suite 2000, Montreal, Québec H3A 1T9. 1-800-661-4578.
M1B 3V4 Insurance products and services distributed through I.G. Insurance Services Inc. (in Québec, a financial services firm).
Insurance license sponsored by The Great-West Life Assurance Company (outside of Québec).
© Investors Group Inc. 2010. ™ Trademarks owned by IGM Financial Inc. and licensed to its subsidiary corporations.
Written and published by Investors Group as a general source of information only. It is not intended as a solicitation to buy
1-800-848-7229 or sell specific investments, nor is it intended to provide tax, legal or investment advice. Readers should seek advice on
their specific circumstances from an Investors Group Consultant.
Commissions, fees and expenses may be associated with mutual fund investments. Read the prospectus before investing.
Mutual funds are not guaranteed, values change frequently and past performance may not be repeated.
Investors Group Financial Services Inc.
MP1224 (05/2010)

2. From diaper-stage on, your children’s which may require you to pay back Your Family Safety Net—If you have likely want to live in a neighbourhood Registered Education Savings
well-being requires considerable EI benefits should your year-end a young family, you need to protect filled with other young children. Not Plans— For children who go on
financial expenditure. Your financial income fall above the cut-off point. Talk them in the event an accident or ill- only does this indicate a child-friendly to post-secondary education, RESPs
plan needs to provide for your chil- to your Investors Group Consultant ness prevents you from providing area, but it will provide your children (Registered Education Savings Plans)
dren’s present and future educational about potential tax impacts and try to for them while they still depend on with immediately accessible playmates can make a big difference.
and recreational needs. You may set aside accessible cash in anticipation you. Life insurance and disability and young friends. It will also offer An RESP enables the subscriber to
decide to move to a larger home or of that possibility. insurance is usually a solid starting you neighbours and potential friend- make contributions on behalf of
a neighbourhood with more to offer Those who are self-employed or point. Stay-at-home parents should ships with other adults sharing similar someone who intends to seek higher
your family. You’ll want to protect who do not pay into the federal also consider life insurance, remem- child-centred interests. education, including themselves or
and provide for them, should you employment insurance plan will bering the potential need to replace School Days— Once your child their children. Growth in the plan
become ill, incapacitated or die pre- generally not have access to federal their caregiving with professional begins kindergarten, possibly your accumulates on a tax-deferred basis.
maturely. And you will begin to con- leave benefits. In this case, it would childcare and domestic help, which most important consideration will be There is no minimum or maximum
sider, now that you have heirs, the be wise to build a sizeable emergency can be costly. Your Investors Group selecting your child’s school. Public annual contribution to an RESP.
nature and extent of inheritances you cash reserve to cover expenses until Consultant can complete an insur- school systems in Canada, largely The lifetime maximum contribution
will want to leave for your children. you are able to return to work. ance needs analysis, and recommend locally funded, provide excellent edu- for each child is $50,000.
There are so many needs to meet and the coverage best suited for your cation, but programs can vary widely
Child Care— More families these days personal situation. The Canada Education Savings
goals to fulfill. Where do you start? have two income-earners, and the from one school division to another. Grant (CES Grant) and provincial
primary caregiver for the child will Home Sweet Home— With children You may also consider sending your programs may provide additional
Do Your Homework likely return to work within a year or come lifestyle changes, and the biggest children to private schools. Fees for funds. For more information about
two—or perhaps even sooner—after change may well be your choice of such schools can range from as low as RESPs, CES Grant and provincial
Maternity and Parental Leave—
Federal employment insurance (EI) the child’s birth. Child care expenses home and neighbourhood. $3,000 a year for day students to more programs in your area contact your
will not fully cover income lost by (including the cost of a nanny) are You may decide to move to a bigger than $26,000 at some prestigious, full Investors Group Consultant. If you have a young family, you
the spouse taking leave, which can tax-deductible on personal income home or a more “child-friendly” boarding schools with strict academic need to protect them in the
Investment Accounts— If you begin
extend up to a full year in some taxes at both federal and most provin- neighbourhood boasting good schools, performance requirements. Many pri- event of an accident or illness
a portfolio designed to save for uni-
provinces, before and after the baby’s cial levels. The spouse with the lower community clubs as well as a wide vate schools admit some students for that may prevent you from
versity or college while your children
arrival. The taxes deducted at source income must claim the deduction range of sports opportunities and lower fees, dependent on family are babies, you’ll likely favour equity- providing for them while they
from the leave benefits may not be which is based on that spouse’s recreational facilities. income levels. Some provinces permit type investments (such as stocks still depend on you.
sufficient to cover your total personal earned income. Tax deductions for Your son or daughter will interact “charter” schools run by groups of and equity mutual funds), since over
income tax liability at year’s end. child care expenses are limited and with others in daycare or childcare parents who espouse a particular the long term, the stock market can
There are also income restrictions vary according to the child’s age. situations, and in schools, but you’ll philosophy of education. provide better rates of return. If you’ve
allow trustees to control the funds
waited until the children are older,
Higher Education well into the beneficiary’s young
you may not have the time frame
adulthood. They are generally suited
The Sooner the Better— The earlier to ride out the ups and downs of a
THE COST OF KNOWLEDGE for asset amounts over $25,000, and
you begin to plan for your children’s more aggressive equity portfolio so
are especially useful for children
Statistics Canada reports national
future education, the better you’ll be you may be inclined towards more
Canada $4,524 with special needs.
average annual tuition has almost able to cover those costs. Bursaries fixed-income investments.
Newfoundland and Labrador $2,633
and scholarships may be available Education Tax Credits— When
tripled, from $1,464 in 1990/91 to Prince Edward Island $4,440 Trusts— You may want to consider
$4,524 in 2007/08*. That’s just tuition, when your children are ready to begin your children attend post-secondary
Nova Scotia $5,878 establishing a trust for your children,
without books, room and board, and post-secondary education. Bursaries school, they may be able to receive
New Brunswick $5,733 to provide them with future income
transportation. may be conditionally tied to family tax credits based on tuition paid, as
Quebec $2,025
and provide you with the tax benefits
Some universities cost more than income levels that could disqualify well as an education credit for each
associated with income splitting.
others. Here’s a snapshot* of average Ontario $5,381 your children, while scholarships may month of full or part-time attendance.
tuition for undergraduate education, Manitoba $3,384 require high academic performances. A properly structured “age 40 trust” These amounts are revised frequently;
for different provinces in the year 2007: Saskatchewan $4,774 Your children could take out student will allow you to accumulate funds check with Canada Revenue Agency
Alberta $4,964 loans to finance their education, but for your child, yet allow you to bene- or your Investors Group Consultant
British Columbia $4,855 this could result in them carrying fit from income splitting if equity for current information. If the student
huge debt loads. investments are used. These trusts cannot use the full credits, the unused
Source: *Statistics Canada – The Daily, October 18, 2007