Hey friends,

Part one is an overview of the RESP and how it can help Canadian families.

Part two is an update on the SmartMoneyKids Project.

Eddie

Kid number two was just born so I went to open an RESP for the little guy - obviously.

If you are a parent of a Canadian kid then I hope you will also consider the RESP, which stands for Registered Education Savings Plan.

It is an account that is designed to help with your kids’ future university education.

You are allowed to contribute $50,000 for each kid. You can do it all at once or in stages, whatever you can afford.

Along the way, you get grant money from the government, up to $7,200. In fact, just by opening an RESP on Wealthsimple, the government will send you the first $500 grant. You help fund it through taxes, anyway, so you might as well do it!

Best option is to lump sum $50,000 on day one and let it compound for 18 years. You don’t get all of the grant money but your future value will likely be greater since you’ve allowed a larger starting amount to compound for longer - giving yourself more time to double and triple your money. In short, it typically outweighs foregoing the free grant contribution.

Of course not everyone has a $50,000 sitting aside to do this, so start with as much as you can. Or ask the grandparents if they can help too.

Once the money is in the RESP, it grows tax-free. All interest, dividends and realized capital gains are tax free.

The money is only taxed in the year your kid turns 18 and starts to withdraw it for schooling purposes. The amount withdrawn is taxable in your kid’s name, and they will be likely in a very low tax bracket anyway so the tax payable for them will be minimal.

If they don’t choose to go to University (cuz who knows whats gonna happen with universities over the next 18 years with AI, etc), the RESP can stay open for 35 years and also be used for other qualifying education such as trade school.

So, if you haven’t done this yet for your kid, do it. If you have, congratulations, and keep funding it until you max it out.

Also, Wealthsimple has increased their promotional offer. If you open an account with just $1, you get $42 bucks.

What’s more, if you transfer at least $25,000, they will pay you a bonus up to 3%. So if you transfer $1,000,000, you will get $30,000 bucks. Not bad right?!

If you do, please be sure to use my code PRGS3Q 🙂

In Summary:

Speaking of Education, the app is now Live!

SmartMoneyKids is the AI-powered financial literacy app I've been building for Canadian kids (and apparently adults too).

Been testing with real families and the results have been really encouraging.

Now for the big news: behind the scenes I’ve been building the next version of SmartMoneyKids and it’s a major leap forward. Here’s what you get today:

If you haven’t logged in yet, now is the perfect time. The app has changed dramatically since launch and there’s a lot more for your kids to explore.

Sign up here: SmartMoneyKids

People who sign up in the next 30 days get founder pricing of $8.99/month and this price will never increase for you. Following that the price will increase to $11.99. Sign up now to get 25% savings.

And if your kid has already been using the app, their progress carries over perfectly into the new version. They’ll pick up right where they left off.

Thanks for everyone’s support on this, and please share with your friends and families who would appreciate being part of this learning and growing!

A lot more to come 🙂

PS. Interestingly enough, as I power through the modules, I find myself in agreement and enjoying all the lesson content and how it’s presented. Therefore I see this application helping adults as well, even from the outset modules (what is money? what does it mean to barter? Explained simply rather than the Econ 101 textbook that was written in the 70s). Even if you don’t have kids, maybe sign yourself up to give it a try! If we see a trend that way, perhaps we can fine tune this for adults to make personal finance great again.

PPS. If you prefer your smartphone, a good trick is to add the website to your homescreen so you can click on it just like a normal app, rather than opening safari and navigating to the website.

PPPS. I've created a separate publication for SMK to give you OG journal subscribers some space and respect your preferences. It also helps me keep things better organized. The GIJ will continue business as usual, while the SmartMoneyKids publication will be focused solely on its mission to develop financial education for kids. There will of course be some cross-over ideas between the two, but not always.

“Where there’s a will there’s a way.”

—proverb

What are your thoughts on AI? Are you a user? How are you using it?

Next week I plan on writing a section on how I am utilizing its capabilties, bringing it into my workflows, and some thoughts on how it might shape our futures.

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For Your Kids
Teaching your kids about money? SmartMoneyKids is an AI-powered financial literacy app for Canadian kids ages 6 to 18. RESP, TFSA, saving, investing, business, in language they actually understand. Sign up here.

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Get $42 when you download Wealthsimple. Code: PRGS3Q