Quickest way kids to own a house - which accounts to invest in first?

will888 wrote: ↑ OP, you know how the RRSP accounts offer advantage when the marginal taxation when decumulating is lower than when contributing. A job at age 16 is unlikely to result in a high marginal tax savings rate. Would it not be better to save that room until later in life when there is higher income?

smartie wrote: ↑ Is this buying a house as early as possible for some specific reason?

...When your kids grow up, how do you know where they want to live?

Also, if they get married, they will buy a house , might be in Canada or foreign country and he will only pay half for house

MrMikeDD wrote: ↑ I was thinking they could buy a house to rent out - they are more than welcome to live at home (assuming they're good kids, listen to our rules still, etc...). And now that I said that (or types it), I wonder if the first time home buyers programs has restrictions on this. Maybe you need to live there for 1 year to do it?

smartie wrote: ↑ Thanks

So what you meant is housing as an investment, at least at the beginning? Also when you said buy a house, you refer to enough down payment instead of full price?

MrMikeDD wrote: ↑ So your suggesting it's more profitable to use an RRSP later in life when there is higher income - that may be true. But the argument then is, is that worth sacrificing for the opportunity to get your first home quicker? But to really answer that, you need to know how much a 16 year old will get back from his RRSP contributions, and how much will that compound to, each year, if done for say, 9 years (assuming we're looking to buy a house at 25).

If they're able to buy a house at 25, that investment might be worth a lot more than the RRSP savings if he contributes later in life. Or maybe that amount is no minimal that it's better to just use a TFSA first and leave the RRSP for later in life when their income is higher.

My step-daughter is 28 years old. She, and almost all of her friends are renting (and not contributing to their RRSP) and I don't see them saving up for a house. So I'm thinking, step1, get my kids to own a house. Once they do that, then lets think of other stuff like investing in an RRSP later in life when there is higher income - OR maybe I'm wrong. What's better if it was one or the other: owning property or investing in an RRSP? I'd guess if it had to be one of the other, own a house is better.

cheapshopper wrote: ↑ Daddy bank.

My 15 years old already asking me to pay for her first starter home when she turn 21. Like condo or a small Town house.

cheapshopper wrote: ↑ Daddy bank.

My 15 years old already asking me to pay for her first starter home when she turn 21. Like condo or a small Town house.

sushi604 wrote: ↑ Your kid is smart. She’ll be ahead of her peers! I wish I had this type of mentality when I was 15. Back then at age 15, all I think of is getting good grades and the only things I ask money for is cheap clothes!

MrMikeDD wrote: ↑ Another factor is one of them has an RDSP. The government matches this 1:1 up to $1K per year. This is meant to be used at age 65. However, he could take it out early as long as we have stopped contributing for 10 years. So if we stop at 15 years old, he can take the money out at 25 years old.

yvrbanker wrote: ↑ It is hardly ever correct to stop RDSP contributions at 15. RDSP is designed as a retirement account and provides the best return when the accumulation continues for many years. It may be not possible to get all the potential $70K of the government match, but hey, why not take the free money.

Not sure how much you know of RDSP fine points, so just a few basics. Most importantly, when the beneficiary is over 18, their parents' income does not matter. It's rather likely the beneficiary's own income (+their spouse if any) will be below $91K/year at least for some years, so they can get a 200%/300% government match: $1.5K would attract a $3.5K from the government. Also, there is an additional $1K/year bond if the beneficiary's income is low, under $30K/year (or under $45K/year for a partial bond). It's a noticeable amount of cash on the table, should be considered even if it does not help with a home ownership.