Friends with kids – the gifting rule

In the last couple of years, my number of family and friends with kids has increased significantly.  My social schedule has slowly moved from weddings and bachelorettes to baby showers and children’s birthday parties.  While I love shopping for cute little matching outfits for kids, the practical side of me thinks I should think long term.  While I think the photo opportunities are great for a kid who has enough outfits for a new one everyday, I think a nice little bundle of cash when they go to college would be a lot more helpful.

Beau and I has thought about this and looked into it.  I think for the first 6 years of a kid’s life, we will be making monetary contributions into their RESPs for birthdays and Christmas.  When they get a little older we thought maybe we break it up and do birthdays as RESP contribution and Christmas as gifts.

Contributing to an RESP comes with other benefits too.  Investment incomes are not taxed in an RESP.  The government will give Canada Education Savings Grants up to $7200.  And we found an insurance policy where contributions will be matched up to 15% to a maximum of $2000.

Maybe this will not make us the most popular aunt and uncle.  But I hope they will appreciate when it comes time to pay for their educations.