By Doreen Shaw
If, as William Shakespeare said, “The World’s Mine Oyster“, then the Registered Disability Savings Plan (RDSP) is most definitely The Pearl encapsulated within The Oyster.
Kenyon is our youngest child and lives with an intellectual disability. He’s doing OK. But I’m his mum and have always wondered and worried about his future.
Then along came the RDSP and what a Pearl that has turned out to be.
In December 2008, I opened an RDSP for Kenyon and he began making monthly contributions of $125. He was 25 years old at the time and the plan was, and is, to continue in this way until 2028 when he will be 45 years old.
But why stop then?
If annual income is under $25,356, then the beneficiary is eligible for the full amount of the Canada Disability Savings Bond and the Canada Disability Savings Grant. The maximum amount of the Grant is $70,000 and the Bond is $20,000 for a total of $90,000. This will be reached in 20 years.
Withdrawals from the RDSP should not begin until 10 years after the last Grant and Bond are received ie: “the 10 year rule”.
2008, Kenyon at age 25, starts contributing to his RDSP.
2028, Kenyon at age 45, stops contributing to his RDSP.
2038, Kenyon at age 55, begins to make withdrawals from his RDSP.
Here’s the math:
$125 each month for 20 years = $30,000 Kenyon’s personal contribution
Canada Disability Savings Bond = $20,000 Government money
Canada Disability Savings Grant = $70,000 Government money
Total = $120,000
Investment in the RDSP began for Kenyon in 2008 and grows on a tax-deferred basis. The money will continue to gain interest until 2038 when it could be estimated to have reached $300,000.
Our financial institution has made it hassle-free to make monthly deposits into the RDSP and monies from the Grant and the Bond are automatically entered into the account.
The total amount could reach $300,000 but that isn’t the true value of The Pearl. It’s so much more than that. It’s in knowing that Kenyon’s financial future is secure. He can live his dreams and Mum can rest easy.
Finding a Pearl inside an Oyster is very rare, but the RDSP captures your Pearl, holds it, enriches it then gives it back with a luster that’s definitely worth waiting for.
Doreen has been involved in the disability community for over 40 years; including being the President of her local Community Living Association, Vice President on the Board of the Canadian Association for Community Living, supporting other parents with their children’s funding and housing needs, advocating for better supports and services and currently serving on the Board of Inclusions BC.