Mar 23, 2010
confirmed with the RDSP department
of the federal government that if you miss a year's contribution you do not lose
the ability to get the grant and bond. For example if you have had an RDSP in
place for 23 years and 3 of those years you could not afford to put money into
it, but contributed for 20 of the 23 years, your beneficiary would still get 20
years worth of grant and bonds in total (if they qualify income wise).
According to the RDSP department,
the federal government passed a new budget allowing for the pushing forward of
unclaimed grants and bonds. Right now it is being interpreted so that the RDSP
department can put this change into their regulations.
The new federal budget also has
provisions to roll over unused RRSP's at time of death into a child's RDSP up to
$200,000 less any previous contributions.
Jan 28, 2010
TD Canada Trust is now the 4th
banking institution to offer the RDSP. It is being offered through the TD
Waterhouse arm of their operation. For more information visit any TD Canada
Trust branch or TD Waterhouse Investor Centre , or call 1-866-280-2022
Scotiabank is the fifth national
bank to offer the RDSP. To find out more contact Scotiabank Wealth Management
Contact Centre at 1-877-929-4499
Vancouver and Victoria have joined
the growing list of districts around BC warning parents that special education
could bear the brunt of unprecedented budget cuts projected for 2010-11, due to
unfunded costs that the province is downloading on school boards.
Richmond: A few weeks ago, a Richmond district report warned that special
education supports could be cut and inclusion policies sacrificed to respond to
the looming crisis (see attached budget backgrounder).
Surrey: Last week, Surrey DPAC warned that some $18-20 million in
downloaded/unfunded provincial costs will result in program cuts that directly
harm students. (Press release attached)
Victoria: Victoria trustees told the Times Colonist yesterday they would have to
consider cutting the district's Special Education program to balance their
Vancouver: Last week, Vancouver served notice that up to 800 teachers could be
laid off to address a provincial funding shortfall ranging from $17 to $35
million, depending on what the province decides to fund in the upcoming
provincial budget. And at a meeting for parents of students with special needs
this week, the Board Chair acknowledged that special education was particularly
vulnerable to cuts, since staff costs are protected via contracts and class size
is now protected by legislation, leaving unprotected services like special
education as one of the few areas they can cut.
Virtually every school board in the province is confronting similar choices,
given the limited number of unprotected programs, like special ed, that they can
cut to make up for unfunded provincial costs, since all boards are required by
law to balance their budgets regardless of provincial funding shortfalls.
Accentuating the looming threat to special education is that the province only
funds half or less of what districts actually spend on special ed - a subsidy
that is hard for trustees to defend when schools are being closed and core
At the core of this unprecedented crisis is the growing number of downloaded
costs that the province has so far refused to cover in provincial education
funding grants. These include further increases for teacher salaries and
benefits under contracts that the province negotiated, new provincial carbon tax
and carbon offset charges, increases to provincial MSP and WCP premiums,
implementation costs of new provincial requirements like Bill 33 and full-day
kindergarten, and general inflation, which the provincial funding formula also
does not cover.
The provincial government will present its budget for 2010-11 in early March and
has to date refused to consider new funding to cover these new costs, leaving
districts projecting the largest deficits seen in a decade, and cuts that will
seriously impact students.
Unfair to target our most vulnerable students: Provincial officials are
justifying the cuts by stating that districts have to tighten their belts like
anyone else. This response fails to acknowledge that districts cannot force most
district services to tighten their belts because they are protected by
provincially-negotiated contracts and requirements. Staff will not sacrifice pay
or benefits and boards must also find a way to cover new pay and benefit
increases negotiated by the province. Along with provincial requirements
governing a host of activities, from class size to reporting and administrative
roles, this means districts actually have very few options or "discretionary"
spending that can be cut when they are told to tighten their belts.
In effect, school board "belt tightening" amounts to downloading a provincial
budgetary crisis onto the most vulnerable students in our public schools -
students with special needs, ESL and Aboriginal students and those who need
additional programs and supports to succeed. In failing to provide any policy to
protect these programs and students while protecting everything from teacher
pensions to teacher-student ratios in law, the province has created an uneven
playing field that forces school boards to unfairly penalize their most
vulnerable students whenever cuts must be made.
ADVOCACY: The harsh reality facing our kids is just emerging and there is very
little time to act. Parents and advocacy groups representing students with
special needs and other vulnerable groups need to act immediately, by telling
their MLAs, Education Minister Margaret MacDiarmid, Finance Minister Colin
Hansen and Premier Gordon Campell that it is not acceptable to target BC's most
vulnerable students to solve a problem they had no hand in creating.
1. We need to act ASAP to convince the province to either cover these unfunded
costs or to level the playing field to protect services for BC's most vulnerable
students from being penalized unfairly. We need to convince government to cover
all education costs in the 2010-11 budget before it is presented on March 3. It
will be almost impossible to convince government to adjust that budget after the
- We invite special needs parents and advocacy groups to join us in drafting a
collective letter voicing concerns about the looming cuts targetting special
education and to request an urgent meeting between the Education Minister and a
representative delegation. Please contact me ASAP to discuss how we can get
started on this.
2. Governments pay attention to numbers. We can be most effective if we join
with broader groups of parents, PACs and public education advocacy groups to
demand that the province fully fund all provincially-mandated costs, including
special education - instead of fighting each other for shares of an inadequate
budget and ignoring the roots of the problem.
- Contact your PAC and DPAC and encourage them to write the Premier, FInance
Minister, Education Minister and your local MLAs - just as Surrey DPAC has done.
- Join our growing Facebook group by searching: "Stop BC Education Cuts" or
visiting us at:
Find out what other parents and districts are doing and connect with other
parents or advocacy efforts in your community.
Sept 30, 2009
Following the completion of an
in-service managers training on the RDSP for DDA, a blog was started with
comments that will help non-attendees better understand the pros and cons of the
RDSP and get a sense of how to integrate it into your own financial plan.
According to Evelyn Jacks, the tax
expert, there are regulations regarding how the RDSP must be consumed by the
Our group contacted the federal
government directly to get more clarification on this and we were surprised to
find out that the maximum withdrawal formula they have already written into law
may prevent your disabled family member from ever accessing all of the
money you leave behind in the RDSP.
RDSP Payment Rules
are two types of payments that can be made from RDSPs:
Disability Assistance Payments - any payment made from the RDSP to the
Lifetime Disability Assistance Payments (or LDAP)– a special type of payment
that must continue at least once a year after they begin. These payments can
begin at any age but they must begin when the beneficiary turns 60 years.
Disability Assitance Payments are limited to an annual maximum amount based
on the beneficiary’s life expectancy and the value of the plan. This amount
is determined by the following formula:
Total value of RDSP/(Life Expectancy + 3 – Beneficiary’s Age) + Annuity
age 80 is reached, according to the federal government this formula changes
Total value of RDSP/(Beneficiary's age + 3 – Beneficiary’s Age) + Annuity
a doctor has said in writing that a beneficiary is not likely to live more
than five years, life expectancy is set at 80 years. This means that in
most cases the formula will be:
value of RDSP/(83 – Beneficiary’s Age) + Annuity Payments
the beneficiary gets older, the size of the payments may grow (if in
previous years there were no significant withdrawals or market losses). You
can, however, use annuities so that the payments are the same from year to
example, let’s assume your child has $100,000 in his RDSP at the age of 60.
Lifetime Disability Assistance Payments option:
payment would be calculated as follows:
1 $100,000 / (83 – 60) = $4,347
2 $100, 913 (assuming income at 5.5%) /(83-61) = $4,587
mentioned, after age 80 though, this formula changes to:
of RDSP/(Beneficiary's age + 3 – Beneficiary’s Age) + Annuity Payments
ultimately boils down to:
of RDSP/3 + Annuity Payments
matter what, after age 80, the maximum LDAP is 1/3 of the account total.
This decay formula may mathematically prevent your disabled family member
from ever accessing the remaining money in the RDSP.
Feb 16, 2009
The RDSP is now also available at
the Royal Bank of Canada. It is supposed to be available at the branch level so
that you don't have to get into a phone line-up to get more information about
it. You can find out more about it at:
officially launched in December of 2008. Despite the promises of one credit
union that it would offer it, BMO Bank became the first and currently only
provider of the RDSP in Canada.
For families with a net income of over about
$75,769 per year, the RDSP with its legal obligations and tax status may not be the
best vehicle to leave money behind for your disabled family member (when
compared to other investment vehicles like the Tax Free Savings Account. See
your advisor for more information).
families making less than $75,769 a year, the RDSP has a up to a 233% matching grant
and for those making less than $21,278 a year, your child is also entitled to a $1000
Canadian Disability Savings Bond annually which
can make saving money for your child a lot easier under strained budgets.
To open a BMO
Account, you can contact the number on their website (reported call times can be
up to 3 hours) or you can download these forms which they will
require you to be fill out anyway to open a BMO RDSP account:
RDSP CDSG &
CDSB Grant Application Form for over 18
RDSP CDSG &
CDSB Grant Application Completed Sample Form for under 18
RDSP CDSG &
CDSB Grant Application Form for under 18
RDSP CDSG &
CDSB Grant Application Completed Sample Form for under 18
BMO RDSP Account
BMO RDSP Account
Application Completed Sample Form
due to the obligations that come with the CDSG and CDSB grants, do not set up an RDSP where the
grants are invested in market based investments, or investment accounts that
have deferred sales charges.
If the RDSP must be dissolved due to the death of the RDSP beneficiary or
because their disability ended due to medical intervention, then such accounts can suffer severe penalties
that will leave the account contributor with less money than they put into it.
free to contact us for a no obligation check-up and use the
results to clarify your own situation and see what choices you have to face