Registered Disability Savings Plan (RDSP) Tips and Master List by Lisa
Like most parents, we signed up for a Registered Education Savings Plan (RESP) when our son was born. We had hopes and aspirations, as all parents do, that he would develop into a successful adult and attend some type of post-secondary schooling.
Life does not always go as planned. As the saying goes, “life is what happens when you are making plans”. After getting the autism diagnosis at the age of 3, we learned about the Registered Disability Savings Plan (RDSP) that had just been newly created by the federal government. RDSP had not been part of our vocabulary until months prior, but we quickly learned that this was a new savings vehicle that could grow money quickly if invested properly.
I am sharing some tips and lessons earned over the years as a parent and a Regional Coordinator at AutismBC.
Tip 1: Your RSDP will require some TLC
Do our due diligence, ask questions and look at statements. This is an important asset for our loved one and deserves some TLC. When we first started our RDSP, our banking institution was new to all of this too and did not invest the money in any fund, so our contribution along with the government’s just sat and did not gain any interest. Our financial advisor soon clued us into this. I could not blame the bank as it was a new program and they were learning the ropes as we were, and I am sure the banking institutions are now better versed in growing an RDSP. After moving the RDSP over to our financial advisor’s capable hands, our son’s RDSP has since grown with our contributions and the government’s.
Tip 2: It’s Okay to Start with Small Contributions
I am aware that not everyone can make regular contributions to their loved one’s RDSP, but keep in mind that even if the contribution is small, it will still grow. The government has a program called Endowment 150 that starts with a one-time grant of $150 to help kickstart the growth of one’s RDSP. Check out the following link for eligibility requirements: https://www.rdsp.com/endowment-150/
Also, find out how Erin’s RDSP has grown from $15,000 to $90,000 over ten years: https://planinstitute.ca/2020/02/06/erins-rdsp-story/
Tip 3: Check out PLAN/DABC’s Website
My go-to when talking to families about RDSP is Plan Institute/Disability Alliance BC. They have experts in the field, an online tutorial, web resources and even a toll-free help number! Toll-free Helpline 1-844-311-7526. Link to their RDSP website is here https://www.rdsp.com/
Tip 4: Be Mindful of Restrictions
RDSPs are for the long-term. These are savings vehicles that are meant for when our loved one is well into adulthood, but not for that trip to Hawaii they may want to go on. There are specific restrictions surrounding withdrawals from RDSPs and the timing of withdrawals. The website above will give you all that information.
Tip 5: Deal with Your RESP
If there is already an RESP in place for the child, check with a financial advisor about whether it should be left as is or if there is any other option. The professionals will be able to provide you with some good answers and options.
Additional information on RDSP:
Life on the Spectrum Podcast: