Do you believe the savings in RESPS are going to be enough to finance their children's...

 

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Do you believe the savings in RESPS are going to be enough to finance their children's education, if it is estimated each child will need approximately $100,000 when they turn 18 to go to school? 1. Show calculations as to what their current contributions of $100 a month will be worth when each child reaches the age of 18. Do not forget to include the 20% CESG contribution - assume a simple payment of $20 per $100. Assume a rate of return of 8% on investing the money and also remember each child will have $25,000 from their grandparents at age 18. a) What will Milo and Janna likely have to save extra to reach this goal? b) What other suggestions do you have to cover these educational costs in the future? Do you believe the savings in RESPS are going to be enough to finance their children's education, if it is estimated each child will need approximately $100,000 when they turn 18 to go to school? 1. Show calculations as to what their current contributions of $100 a month will be worth when each child reaches the age of 18. Do not forget to include the 20% CESG contribution - assume a simple payment of $20 per $100. Assume a rate of return of 8% on investing the money and also remember each child will have $25,000 from their grandparents at age 18. a) What will Milo and Janna likely have to save extra to reach this goal? b) What other suggestions do you have to cover these educational costs in the future?

Answer rating: 100% (QA)

Certainly lets calculate the future value of the RESPs with the given contributions CESG and rate of ... View the full answer