Assignment $2($Case Study Retirement Financial Planing$)$

Mary and John, a married couple and each earning $70,000$ per year. They have two

children, Eli $(7$ years old$)$ and Tom $(4$ years old$).$ They are considering opening an

RESP to save for their children's post$-$secondary education. They have heard about

the benefits of RESPs, such as government grants and tax$-$deferred growth, but

they are unsure about how to maximize these benefits and the potential

implications.

They plan to contribute $$2,500$ per year for each child to maximize the CESG.

They also want to understand the investment options, the impact of not using the

funds for education, and what happens if their children decide not to pursue postsecondary education.

Required: Answer the questions below $($show your detailed computations as

required$)$

$1.$ How much will Mary and John receive from the CESG if they contribute

$$2,500$ per year for each child?

$2.$ What are the main investment options available with in the family RESP?

$3.$ What happens to the RESP funds if both children decides not to pursue postsecondary education?

$4.$ Can Mary and John still receive the CESG if they miss contributing in a

particular year?

$5.$ What is the Canada Learning Bond $($CLB$),$ and are Eli and Tom eligible?

$6.$ How are the funds taxed when withdrawn for educational purposes